busta move

I think that boom and bust is always going to happen unless you prevent it with very draconian legislation. The big problem here is that you really want to be saving up money during the good times to help you get through the bad times. GB has been borrowing lots of money (and encouraging Joe public to do the same) during the good times so we've got nothing to fall back on when there is a recession. Oh dear!

Seems that Interest rates are on the rise globally. Will this have any effect on our interest rates? Maybe not directly but it must be a sign that there are global pressures for upwards IRs. Even Japan are starting to put rates up!

Great in the sense of large (like in Great Dane) rather than in the sense of good.

I also heard him Radio 4 this morning saying "FTBs are coming back to the market, perhaps because they are realising that buying is cheaper than renting!" I'm furious that he got away with saying that. A house on my street recently sold for £210K. I'm paying £750 pcm rent on the same type of house. The interest payments alone on a £200K mortgage are £833 and that's calculated at 5% interest.

The only way we'll get a sensible economy is without short-term fixes and gimmicks. Unfortunately, this will never happen in a democracy because the government can never look past the next election. I have long since given up all hope of an ideal world with sensible politics. Since you can't beat it, you might as well join it which is why we see so much "glee" at the impending possibility of a house crash.

SIPPs U-turn for me.

Two up, two down style end of terrace in NE Kent @ £750 pcm

I don't think it's so much a case of him winning as Labour losing. Still, John Major managed to hang on in there for one more election after the economy went Pete Tong last time so perhaps Brown will have his moment of glory after all.

Unless she's working part time in Tesco because, having made her millions in investments, she's retired and fancied doing an "honest job" just to keep her busy!

Such a shame that we still don't have any credible people to vote for. About the only person I know of in the house of commons that I would actually like to be PM is Borris Johnson and that's only for a laugh. Is it any wonder that people are so switched off to politics these days?

Sadly, only 1. I've "reasoned" with quite a few more but it seems that sensible argument has no sway in these times of madness and quite a lot have chosen the last year to buy their first homes! I don't think they'll fall into the negative equity catagory as they all had quite large deposits but it is sad that they are all getting so much less for their money than they should be able to.

I'm increasingly enjoying renting. I think so much of it depends on your landlord. My current one is very good. I happen to know that he has no mortgage on the house so I've no fears of him chucking me out for any reason. He fixes stuff when it breaks. The house is well-enough decorated that I don't have any burning desire to paint anything or re-install anything. He doesn't mind us putting up stuff on the walls so about the only thing I can't personalise about the house is the paint, carpets and fittings and they're all fine anyway. For those of you that are renting and have a burning desire for a change of decor, he's an idea: just move house! It'll be less hassle and cheaper. I was talking to a friend of mine who has recently bought. He was saying how glad he was to have his "own place" at last. Problem is, it's not his own place because the bank owns most of it, he's had to rent out two rooms so that he can afford the mortgage and he is spending a lot of time and money doing it up because the decor was so bad. I can't work out how that is a relief to him but good luck! I plan to buy when the prices are sensible but we're saving money at a good rate and I'm not scared of the idea of renting until we retire (we're still in our twenties) if the market doesn't go back to sensible because we'll have enough savings to buy a house for cash (even if we have to move abroad) or live off the interest.

I quite agree. If you can afford to live in your house then stop thinking of it as an investment and try making money in an honest way! If only people had this attitude in the last 10 years then we wouldn't be in this over-inflated market in the first place. I don't want to make money at other people's expense (even if their greed does make me think they deserve it). I just want to be able to buy a sensible house at a sensible price. It's not an investment, it's a place to live.

I agree with you. The funny thing is that, when house prices rise, people feel richer when actually, a lot of the time, they're poorer. Unless, you're lucky enough to jump off the property ladder and cash in on the rise in prices, all bigger house prices mean is that you've got a bigger mortgage and hence less to spend. The trouble is that people don't seem to realise this and it takes them a while to realise that they're spending more than they should and then we get the hangover time where spending is low and bankruptcies are high.

Sounds like you don't fall into the over-stretching-like-a-nutter category. I don't think your purchase will be a good investment financially but that's not why you’re buying it anyway so my advice (not that you need/want it!) would be to buy the house, and then forget about house prices for ever. As long as you don't lose your jobs then why should you care? If more people paid no interest to the investment-potential of their houses then we wouldn't be in this mess with house prices in the first place. I do hope you are planning to severely over-pay on that mortgage though. Otherwise you may as well just lube up and grab your ankles with the amount they'll be stealing from you in interest.

Ahh, OK. So, bears out there, tell us why it can't/won't happen. I've just had a thought: if I'm pretending to be a bull for the sack of debate, does that make me debatabull!

Which bit, the debating part or the pseudo-bull logic?

A lot of posts here recently have talked about the lack of bulls to "debate" with. Let's practise our debating skills by taking an opposite view to our usual and see how good a fight we can put up! I'll start off: [bull hat on] Although prices have risen (unfairly) in the past few years, this does not guarantee a crash will follow. Many of the arguments posted here predicting a crash are based on the assumption that free-market forces apply. We are not living in a truely free market because the government is always meddling and vested interests are always confusing people's expectations of house prices. In the end, it is down to what a house is sold for that dictates its price and, if people (on average) still refuse to sell for lower prices the prices will not drop. An alternative ending to the current scenario is that we may end up in a new (old) paradigm where most housing is owned by landlords and very few properties are bought or sold (and hence value is much more abstract a concept).

Just so that there can be no doubt about it later; are you saying that you predict that HPI is on the way up again? What do you think it will be in about half a year? Make sure you are still posting here then so we can all discuss the veracity of you predictions. Also, you seem to keep referring to the YoY house price indices. Do you accept that the trend over the last six months is negative?

Check this one out: http://www.findaproperty.co.uk/agent.aspx?...prop&pid=331910 I drive past it regularly and it's a nice enough house. so what's special about it I hear you ask? Well, the one next to it was also up for sale but when I went past it the other day, I noticed that the sign was down. They must have given up. It'll be interesting to see what happens to this one.

Good luck. Let us know how you get on.

I especially like the quote from Mr Bolton King: "This is supported by the fact that levels of unemployment have been decreasing since 2003 and inflation levels have remained broadly the same." WTF? Is he on a different planet from me? Guns are not the answer though, we need a bird-flu outbreak!

I was a bit worried which way the article was going to go but, in the end, I think the conclusions were fair enough. I think the most important thing is that, even if the BoE do take into consideration the state of economic growth, a cut in interest rates is only going to be a short-term fix anyway. If we want a healthy economy, we have to be more responsible about how much debt we encourage people to get into. Spending financed by borrowing should only be used as a short term way of keeping things going. Afterwards, we need a bit of time to pay off the loans and save some money for the next rainy day or else we're going to head for a melt-down. Like we are at the moment!

I'm in Sevenoaks and I'm not really sure if that bears any similarity to Borough Green but things do seem to be slow around here. There was a thread on here recently about houses in Tonbridge (or was it Tunbridge Wells?) saying that people were having to take chunk off the asking prices before they would sell.

It was also delusional to expect a house that was bought in '95 for 100K to sell for 250K in 2002 but that sort of thing has been happening all over. The whole point of a bubble is that it IS delusional. That's utterly wrong! Interest rate affect your monthly repayments. House prices affect the total amount you can borrow. I would have no problem making the monthly repayments on a 200k mortgage but a bank would never lend me that much. It's just not physically possible for me to borrow enough money so it doesn't matter how low interest rates are because I can't take out the loan.