Saturday, Apr 19, 2008
Clingons on the starboard bow
Times online: Boldly going into uncharted territory
Prices fell 7% in Germany this YTD and no boom to push them up either.
Posted by waiting for the crash @ 10:26 PM (524 views) Add Comment
5 Comments
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1. quiet guy said...
"There are, however, some strange charges flying around.
One is that under Brown the government bent over backwards to boost the housing market and we are now paying for it. Sorry? Under Brown at the Treasury mortgage-tax relief was abolished and stamp duty raised to punitive levels, particularly on more expensive properties.
If people mean that Labour should have reintroduced credit controls – something that would have been condemned as a return to the 1970s and impossible without the reintroduction of exchange controls – they should say so. If they mean that the Bank should have kept interest rates at levels that would have given us slower growth, higher unemployment and a big inflation undershoot, that is a pretty strange set of priorities too."
I think that's one of the best arguments in defence of Brown I've heard. Thoughts anyone?
(No, I'm not a fan of Brown - just want to highlight this particular take on the situation.)
2. confused76 said...
Quiet
I respectfully disagree!
The BTL tax treatment is the most obscene piece of fiscal regulations this side of Africa
It is pure reward of rent seeking, incentive to re-distribute wealth from the poor to the rich, undoing of 10 years of social progres since "right to own"
Brown is a basket case, the quicker he goes down the toilet the better
David Smith is an i@iot. He says "credit control" then he mentions interest rates. Either he does not know sh*t of what he pretends to talk about or he is a liar. or both.
Yes, I want to see "credit control" reintroduced. No more lending above 70% of the value of a property, no more phoney valuations, max 3.5x joint salary.
I want to see the end of the BTL. I want to see the BTL mortgages regulated by the FSA. I want to see an FSA staffed by people who understand of capital markets. What does it have to do with interest rates?
3. montesquieu said...
German numbers are quite interesting as they certainly haven't had serious HPI there. When my German friends visit they just laugh at what people pay for housing here. What's interesting is that while they pay a lot less for housing (buying or renting - there you save up a 30% deposit and buy a house in your late 30s or 40s, while rents and tenancies are higly regulated - if you pay your rent about the only reason you can be tossed out is if the landlord needs the place back as his primary dwelling), they SAVE the difference in what it costs - put it in the bank - rather than blow it on crap down at some overpriced edge of town shopping mall.
Interestingly prices for appartments have risen a little in their part of Germany - a rapidly gentrified part of former East Berlin - mainly due to Brits coming in and buying up what they see as very cheap flats, ether to live in or to BTL (probably unaware they won't be allowed to make any rent rise for maybe 20 years).
At the same time, while some areas do well (Hamburg, Frankfurt, but particularly Bavaria, home of the auto industry) other parts of Germany are imploding as a lot of manufacturing goes to other countries with lower corporation tax and lower wages - while in the old east, the industry was sold up years ago and all the young people with any ambution (especially young women) have already left, leaving being gangs of disgrunteld neo-nazis suffering from 'frauenmangel' (literally woman hunger). Not prety ... just like in DDR times, you don't want to leave the motorway if driving west from Berlin ... then you had no choice, now you just wouldn't if you can possibly avoid it.
I would guess falling prices are largely down to this hollowing out of large parts of Germany (rapidly falling population too won't help) but certainly bears further investigation.
4. alan said...
"There are nearly 700,000 job vacancies, the highest since the current series began in 2001. The unemployment claimant count is at its lowest since June 1975".
Yes, that's because the government took people out of "unemplyment" stats and put them into "incapacity" and put them on training scemes that don't bring jobs.
Much of our manufacturing was offshored years ago. Even our service centres are now in India.
5. paul said...
"Under Brown at the Treasury mortgage-tax relief was abolished and stamp duty raised to punitive levels, particularly on more expensive properties."
Or was that just a tax-grab to take full advantage of the housing boom?
?