Stars, on 19 November 2009 - 03:24 PM, said:
You don't create any wealth by holding on to real estate for a price rise, you only add extra costs for others
In fact, those extra costs created by all the real estate vampirism in the uk are the reason people can't make money doing the things that do actually create wealth - all the surplus wealth is sucked up into the real esatea market.
Let's get this straight once and for all. Who gives a crap about bulls and bears. Plenty of people here have bullish or partially bullish views and are perfectly sensible. What it comes down to is whether you think straight line positive HPI is a good thing or a bad thing. And if you think it's a good thing, stop and think why. Because there are lots of reasons why it's a bad thing.
HPI hurts everyone who is buying a property more expensive than the one they currently own (that includes FTBs). HPI helps downsizers. That's it. It's that simple. HPI takes from the young and the average and gives to the old and the wealthy. And I mean the super wealthy, not the moderately wealthy like this muppet Jesusaves.
I have made over half a million quid from HPI and I live in what most people would call a sizeable property. Do I come and gloat? No, because I am NOT better off. Because HPI has still stolen from me. I am 30 years old and will soon want a bigger house to settle down with a family. Therefore this HPI has made me poorer. Who has it made richer? Older and richer folk than myself, even though I myself am in the top 0.1% of earners.
So for anyone here to WANT HPI they must either be old (in which case they should know better than to want to deprive younger generations) or obscenely wealthy. It is a pity that there is such a lack of understanding of this in the media. All that continued HPI will do is make it harder and harder for new buyers. So people will buy later in life, at higher salary mutiples, with more debt, chaining themselves to ever larger hamster wheels in the name of social inequality. How on earth is that a good thing?
Now, I'm not pro-crash either, although I think we have already had a sizeable crash in the new build sector of the market, but I think long-run stable prices are a good thing. A further crash reduces mobility and would also hurt young people unduly since they are typically the people with least equity and highest leverage. Therefore it would be best if property prices just stayed still for ever. It won't happen, but surely it is clear why this would be a more desirable situation than huge HPI or even HPC?
Do you have children, Jesusaves? Surely you realise that your £2.2mio is bugger all in the big scheme of what they will need to be left if HPI continues?