ItsColdUpHere Posted April 20, 2009 Share Posted April 20, 2009 (edited) I'm a homeowner, so I have money to "lose" if house prices go down. (although they'd have to lose the mythical 90% for me to be in negative equity). But I also have 3 children and lower house prices will help them start their adult lives - why should I gain money for nothing whilst my children suffer for their entire lives through large mortgages. 40% off would only mean I'd lose the free money I gained on my first house. So on balance a 40-50% fall would suit me down to the ground, as it would be better for the country, and more importantly my children in the long run. I can understand people not BELIEVING house prices wont go down much, what I can't understand is why the WANT house prices to be higher when its so detrimental to large sections of the population. Cheers... (FWIW, i THINK house prices will lose 30% nominal then drift down to 40-45% real off over the next few years. Although if deflation gets imbedded it could be much worse). Edited April 20, 2009 by ItsColdUpHere Quote Link to comment Share on other sites More sharing options...
bb7t6 Posted April 20, 2009 Share Posted April 20, 2009 I thought a bull in any market was someone who predicts prices will rise, not necessarily someone who wants prices to rise. Quote Link to comment Share on other sites More sharing options...
bb7t6 Posted April 20, 2009 Share Posted April 20, 2009 I thought a bull in any market was someone who predicts prices will rise, not necessarily someone who wants prices to rise. Quote Link to comment Share on other sites More sharing options...
ItsColdUpHere Posted April 20, 2009 Author Share Posted April 20, 2009 I thought a bull in any market was someone who predicts prices will rise, not necessarily someone who wants prices to rise. Technically yes, but most of the bulls seem to think that high house prices = good, low house prices = bad, and thats the bit I don't get. Quote Link to comment Share on other sites More sharing options...
ExecutiveSlaveBox Posted April 20, 2009 Share Posted April 20, 2009 Technically yes, but most of the bulls seem to think that high house prices = good, low house prices = bad, and thats the bit I don't get. Greed plain and simple. With a good dose of me me me screw everyone else thrown in for good measure. Also a fair bit of short sighted stupidity. Quote Link to comment Share on other sites More sharing options...
Tim Miller Posted April 20, 2009 Share Posted April 20, 2009 Technically yes, but most of the bulls seem to think that high house prices = good, low house prices = bad, and thats the bit I don't get. I think 'Itscolduphere' makes a perfectly valid point. Many bulls do appear to want high house prices, after all it's probably the only way they will be or in many respects will ever feel well off. Anyone with children should see the folly of this desire. I would like the bulls to do one thing, close your eyes and think of the house you aspire to owning, be it a thatched country cottage, a flat off Hyde Park in London, a 4 bed detached over looking the sea. Now I want you to put a price tag on your dream property............OK.............how you doing? Now tell me, did you dream of 2,000,000, did that ring your bell, get you full of hope, make you feel happy and content? Or would a figure of 200,000 do it instead? Yes I thought so, 200,000 would be the figure that would really make you happy, low mortgage or no mortgage, money to go out and maybe start a business, or dine out, or buy a new car, afford holidays abroad or simply be able to pay your bills! Should you have children, even better! Quote Link to comment Share on other sites More sharing options...
gravity always wins Posted April 20, 2009 Share Posted April 20, 2009 Greed plain and simple.With a good dose of me me me screw everyone else thrown in for good measure. Also a fair bit of short sighted stupidity. Agree also maybe its because they've gone and overpaid for their little rabbit hutch and think everyone else owes them a favour. Quote Link to comment Share on other sites More sharing options...
Stars Posted April 20, 2009 Share Posted April 20, 2009 (edited) I can understand people not BELIEVING house prices will go down much, what I can't understand is why the WANT house prices to be higher when its so detrimental to large sections of the population. Rising house / land prices are a flat transfer; they are equivalent to taxing one group (the productive) and giving the money to another (the owners of real estate). People concentrate on being the recipients of this transfer rather than on the justice of the transfer and so our politics (both left and right) is driven by people’s wish to be the beneficiaries of what amounts to a gigantic welfare scheme for the rich masquerading as a business. What you are pointing out; that high house prices are economically destructive; has been so carefully and painstakingly camouflaged that most people are shocked when they hear the idea presented. Edited April 20, 2009 by Stars Quote Link to comment Share on other sites More sharing options...
Austin Allegro Posted April 20, 2009 Share Posted April 20, 2009 I think some bulls on here are just VIs, plain and simple - EAs and the like. The majority however, I believe are just irrational optimists. I see them a lot in my work, often self employed people, who see any bearishness as weakness or doom-mongering. I understand this attitude because I can see its necessary to get a business going against the odds; but it's often a narrow vision which doesn't see the bigger economic picture. I really don't think most make the connection between high house prices and inter-generational wealth transfers, the tying up of useful capital, etc. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted April 20, 2009 Share Posted April 20, 2009 I thought bullsh1t market was when prices just keep rising to unsustainable levels, just to allow someone to make massive profits in the short term. Fixed Quote Link to comment Share on other sites More sharing options...
Greg Bowman Posted April 20, 2009 Share Posted April 20, 2009 I'm a homeowner, so I have money to "lose" if house prices go down. (although they'd have to lose the mythical 90% for me to be in negative equity).But I also have 3 children and lower house prices will help them start their adult lives - why should I gain money for nothing whilst my children suffer for their entire lives through large mortgages. 40% off would only mean I'd lose the free money I gained on my first house. So on balance a 40-50% fall would suit me down to the ground, as it would be better for the country, and more importantly my children in the long run. I can understand people not BELIEVING house prices wont go down much, what I can't understand is why the WANT house prices to be higher when its so detrimental to large sections of the population. Cheers... (FWIW, i THINK house prices will lose 30% nominal then drift down to 40-45% real off over the next few years. Although if deflation gets imbedded it could be much worse). +100% (but only got 2 kids I know about ) Nothing more to add Quote Link to comment Share on other sites More sharing options...
Jim B. Posted April 20, 2009 Share Posted April 20, 2009 It never ceases to amaze me how people moan about petrol going up, or food, yet these same people are quite happy to see house prices at record levels. It makes no sense of course. Why should anyone wish that one of life's basic needs be so expensive? The bulls on here are clearly a mixture of VI's and those that bought very expensive one bed flats and are now shitting themselves. Their only choice is to stay their for life or go bankrupt, which kinda explains some of the non-sense they come out with trying to prop up prices. From a wider economic point of view (although some will suffer in the short term) surely it's better for people to spend as less as possible on housing (be it rent or mortgage) so as to spend more on other stuff to stimulate the economy? Quote Link to comment Share on other sites More sharing options...
I'veAlreadyLeft Posted April 20, 2009 Share Posted April 20, 2009 There's no point asking this question on here. There is about as much chance of a senior banker going on Newsnight as there is of a Bull admitting that they're just greedy. They probably don't even realize that is the case. They've just felt so good over the last 12 years watching their homes increase so much in value that they want it to continue. I doubt anyone that wants house prices to be high has ever really asked themselves whether it's a good idea or not. Quote Link to comment Share on other sites More sharing options...
Monkey Posted April 20, 2009 Share Posted April 20, 2009 i have asked VI's as to why prices should be as high as they are, and they just look confused and say that im bitter as i didnt get on the boat earlier, you know when they have no answer as they try to attack you/your view as apposded to having a reasonable adult argument/discussion about it all From a wider economic point of view (although some will suffer in the short term) surely it's better for people to spend as less as possible on housing (be it rent or mortgage) so as to spend more on other stuff to stimulate the economy? True, as once a house is built, there is a very limited "pipe" that money for renting/mortgages goes, but if the occupier could buy a new TV/redecorate etc that will help shops/delivery chains/manufacturing accross the world Quote Link to comment Share on other sites More sharing options...
Mr. Miyagi Posted April 20, 2009 Share Posted April 20, 2009 I'm a homeowner, so I have money to "lose" if house prices go down. (although they'd have to lose the mythical 90% for me to be in negative equity).But I also have 3 children and lower house prices will help them start their adult lives - why should I gain money for nothing whilst my children suffer for their entire lives through large mortgages. 40% off would only mean I'd lose the free money I gained on my first house. So on balance a 40-50% fall would suit me down to the ground, as it would be better for the country, and more importantly my children in the long run. I can understand people not BELIEVING house prices wont go down much, what I can't understand is why the WANT house prices to be higher when its so detrimental to large sections of the population. Cheers... (FWIW, i THINK house prices will lose 30% nominal then drift down to 40-45% real off over the next few years. Although if deflation gets imbedded it could be much worse). +1 Agree completely, not only has HPI priced me and my partner (well not priced out but I refused to take the serious level of DEBT required to get on the ladder) It would price out my soon to be born first child out of ever being able to own his own home, have the real confidence (read AST) to start his own family and ultimately become part of a productive and social society. I also agree that it is a transfer of wealth from the productive to the non productive. I see no other reason of high house prices other than pure and simple greed and of course the fact that they probably purchased at the peak and are now and truly looking down the barrel of a very large gun!! I also believe that the bulls on site as well as vast swaths of the 'educated' British population are complete idiots. They don't seem to realise that DEBT is just a re-badged from of slavery. Rant over Dez Quote Link to comment Share on other sites More sharing options...
bearbullfence Posted April 20, 2009 Share Posted April 20, 2009 Technically yes, but most of the bulls seem to think that high house prices = good, low house prices = bad, and thats the bit I don't get. It is really rather simple. Bulls think house prices will rise, therefore they want them to rise to be proved correct. Ego. Quote Link to comment Share on other sites More sharing options...
Selling up Posted April 20, 2009 Share Posted April 20, 2009 Not necessarily addressing the OP's point but worth adding: Those who believe prices will rise are usually those who stand to benefit from price rises. Those who believe prices will fall are usually those who stand to benefit from price falls. There are two reasons for this: 1. Humans are by nature over-optimistic and tend to think that the outcome which will benefit them is the likely outcome. 2. Humans can act in accordance with their predictions. EG I owned a house at the time I became a housing bear (showing that 1. is a tendency, not an absolute rule). I therefore sold my house so that my situation was such as to benefit from my prediction coming true. Quote Link to comment Share on other sites More sharing options...
Old_Traveller Posted April 20, 2009 Share Posted April 20, 2009 (edited) i have asked VI's as to why prices should be as high as they are, and they just look confused and say that im bitter as i didnt get on the boat earlier, Not exactly, some of them have quite decent arguments that are not immediatley obvious to refute, and some of them may actually believe them. The star of these usually comes down to supply and demand (who's is going to refute the basics of economics?) and a statement that in the UK demand is far higher than supply due to many reasons (dwelling shortages, massive immigration, we are in an island with limited room to build, etc etc). Now many here have shown dwelling shortages in the UK is a bull myth but nevertheless many bulls actually believe it. Edited April 20, 2009 by Old_Traveller Quote Link to comment Share on other sites More sharing options...
Timm Posted April 20, 2009 Share Posted April 20, 2009 ... They don't seem to realise that DEBT is just a re-badged from of slavery... And the ones that do realise, and still want it are the slave owners... And that's it. Slave owners want to own slaves. Quote Link to comment Share on other sites More sharing options...
Agentimmo Posted April 20, 2009 Share Posted April 20, 2009 My personal experience is that most housing bulls want rising prices as it gives them more money , on paper, than they could ever hope to earn in their daily jobs. In some cases, they earn more in HPI per year than their job pays over 2-3 years. The idea that they might lose even 10K of this "wealth" scares the 5hit out of them Quote Link to comment Share on other sites More sharing options...
PopGun Posted April 20, 2009 Share Posted April 20, 2009 As a fellow home owner (with mortgage) I agree with the OP. I know house prices have to come down, and they will. The post selective bulls seem to be absent. I've not come across a single valid reason for high house prices. Quote Link to comment Share on other sites More sharing options...
the flying pig Posted April 20, 2009 Share Posted April 20, 2009 (edited) My personal experience is that most housing bulls want rising prices as it gives them more money , on paper, than they could ever hope to earn in their daily jobs. In some cases, they earn more in HPI per year than their job pays over 2-3 years.The idea that they might lose even 10K of this "wealth" scares the 5hit out of them indeed. the most common type of bull*, in my experience [outside of this site] is probably a slightly older homeowner who has no real hopes or aspirations of earning good enough money though wages to be able to better themselves by moving up the ladder, and who basically just like the idea of being 'worth' a lot on paper and/or who like the idea of being able to getting some serious spending money together for a nice car, safari holiday, or otherwise unattainable luxury via MEW. HPI probably will be bad news for their children [where they have them] in the years to come but, well, that's quite a long time away and who knows what will be happening by then... and, as with any pyramid scheme, you start to get a headache if you think for too long about what will happen a few years down the line. but i think that many of the bulls on here are a little bit more than that, specifically people with a genuine vested interest in rising prices, namely estate agents, BTL-ers, and, possibly childless [or selfish/short-termist] would-be downsizers. * - the distinction between those who say they want HPI to happen and those who say they think it will doesn't seem very important on this site since there's more or less a 1:1 mapping between the two. Edited April 20, 2009 by the flying pig Quote Link to comment Share on other sites More sharing options...
AmateurEconomist Posted April 20, 2009 Share Posted April 20, 2009 High house prices can be something good. It discourages 'poor' and 'unproductive' foreigners to come over here. Why go to a country where things are expensive. You can stay poor in your homeland. Only the wealthy and/or productive will not be daunted. For example, you would come here if you thought that you will 'make it' in the U.K. despite high property prices, or you might come here if you have enough money. Either way, U.K. attracts people with capital or with skilled labour or the entrepreneurial input (i.e., something useful). Quote Link to comment Share on other sites More sharing options...
kzb Posted April 20, 2009 Share Posted April 20, 2009 If it were just a minority of VI's it wouldn't be so bad. And anyway who can blame BTLers wanting their investment to go up, it's only natural they would. What gets me is the media, including the State Broadcasting Service, constantly reporting house price increases in a positive light and decreases in a negative light. Of course I'm with everyone else on here, why the price megainflation of one of the necessities of life (shelter) is meant to be good news I really can't fathom. Yet they seem to have got the majority of the population to swallow it. Quote Link to comment Share on other sites More sharing options...
the flying pig Posted April 20, 2009 Share Posted April 20, 2009 High house prices can be something good. It discourages 'poor' and 'unproductive' foreigners to come over here. Why go to a country where things are expensive. You can stay poor in your homeland. Only the wealthy and/or productive will not be daunted. For example, you would come here if you thought that you will 'make it' in the U.K. despite high property prices, or you might come here if you have enough money. Either way, U.K. attracts people with capital or with skilled labour or the entrepreneurial input (i.e., something useful). i'm not really sure that this makes an awful lot of sense... i doubt that the very poorest immigrants would really factor house prices into their deliberations when deciding whether to come here or not... the level of wages, benefits, and the cost of the very cheapest type of housing [which clearly doesn't involve buying] would surely be more important. Quote Link to comment Share on other sites More sharing options...
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