Savings Data And Wage Deflation

[Peach]

My take on this subject:

Any price crash will just be a blip. Since WWII house prices have doubled every 7 years.

Also, this country isn't getting bigger but the population is growing. This makes land more and more of a premium commodity.

[zzg113]

Since WWII house prices have doubled every 7 years.

No they haven't.

http://www.nationwide.co.uk/hpi/downloads/..._since_1952.xls

They didn't double between 1952 and 1959, nor 1954-61, nor 1957-64, nor 1989-96, and I have absolutely no doubt that they did not double between 1945 and 1952.

So get your facts straight before you decide to talk sh1t.

Edited June 29, 2005 by zzg113

[justanewbie]

You see my point.

He just burbles on ....

even when the audience leaves....

[MarkG]

Also, this country isn't getting bigger but the population is growing. This makes land more and more of a premium commodity.

That'll explain why rents are stagnant and there are record numbers of houses for sale.

[Peach]

That'll explain why rents are stagnant and there are record numbers of houses for sale.

<{POST_SNAPBACK}>

Okay, so my seven years point was invalid.

But it is true that the population is growing exponentially and more people want to buy their homes. The dot.com bust. 9/11 and interest rates rises have done a lot to slow the market.

It is also true to say that average house prices are nearly 3x higher than they were after the last bust.

You guys have been doomsaying for nearly 3 years now.

[zzg113]

it is true that the population is growing exponentially

LOL, wrong again!

Definitions of exponentially on the Web:

Expressible or approximately expressible by an exponential function; especially characterized by or being an extremely rapid increase (as in size or extent); an exponential growth rate.

www.ccpo.odu.edu/SEES/polar/pi_gloss.htm

Unlimited rate of increase.

www.ngo.grida.no/soesa/nsoer/general/glossary.htm

http://www.google.co.uk/search?hl=en&lr=&o...e:exponentially

http://www.optimumpopulation.org/opt.more.ukpoptable.html

UK population has grown 20 per cent since 1950.

Edited June 29, 2005 by zzg113

[MarkG]

But it is true that the population is growing exponentially and more people want to buy their homes.

So why are rents stagnant and why are there record numbers of houses for sale if there's all that demand for housing? Heck, why are there more than twenty unsold apartments on my road alone that have been on sale for over six months? Surely that exponentially-growing population should be queueing up to buy them?

You can make bullish claims all you like, but reality doesn't agree with you.

[Ace]

Okay, so my seven years point was invalid. 

But it is true that the population is growing exponentially and more people want to buy their homes.  The dot.com bust. 9/11 and interest rates rises have done a lot to slow the market.

It is also true to say that average house prices are nearly 3x higher than they were after the last bust.

You guys have been doomsaying for nearly 3 years now.

<{POST_SNAPBACK}>

Welcome to the forum peach.

I thought the UK Population was decreasing ( Can anyone link to that french graph for the female to child ratio for europe that was posted) I will try and find it.

[Peach]

UK population has grown 20 per cent since 1950.

And by how much land has the United Kingdom grown, to accomodate these extra 12 million or so people?

[Ace]

And by how much land has the United Kingdom grown, to accomodate these extra 12 million or so people?

<{POST_SNAPBACK}>

We just put people on top of each other (High Rise).

[zzg113]

by how much land has the United Kingdom grown, to accomodate these extra 12 million or so people?

Why don't you tell me, Peach, by how much the land mass of Japan has increased in the last 15 years, and yet their property prices appear to be falling inexorably year-on-year? Despite them having some of the highest population densities anywhere in the world (far in excess of anything found in the UK)?

By the way, there is enough land in the UK for EVERY SINGLE PERSON to have their own acre.

http://www.amazon.co.uk/exec/obidos/ASIN/1...7533804-5125203

http://www.housepricecrash.co.uk/forum/lof....php/t2950.html

Edited June 29, 2005 by zzg113

[houseinspect]

I've just been looking at rightmove in my local area where 3 years ago you could buy a nice 3 bed semi for £130k. The prices are ludicusly high, and surprise surprise the same overpriced cr*p that was on the market in jan is still there, sorry but these guys have missed the boat. Unless they drop the price by a sensible amount (>10%) they will NEVER sell, but as you say people are greedy and that's what will cause the market to crash. Anyone agree??

[Peach]

We just put people on top of each other (High Rise). 

<{POST_SNAPBACK}>

But this is a compromise, nearly everyone wants a detached south facing house with a garden.

[Ace]

But this is a compromise, nearly everyone wants a detached south facing house with a garden.

<{POST_SNAPBACK}>

Peach,

Spend some time reading the threads. All the points you have raised have been answered & and backed up with actual data.

[RichM]

Yes, we may well all want a decent house, but when some pratt wants to have 7 houses, with the aim of renting 6 of them out, then obviously "demand" is going to feel stronger. There is plenty of housing the UK, lots of housing has been built over the past 60 years. If there was a real shortage of housing yuo'd be tripping over the homeless on your way home of an evening.

[brainclamp]

Peach - Welcome to the forum - good to see someone who doesn't toe the party line on here again.

Your point on population growth is a strong one.

http://www.geocities.com/weakscream/imm2.gif

Check out the 1950s history on house prices vs inflation and real population data rather than the misinformation some posters try to put out, (i.e. its been declining) - in my thread ;

http://www.housepricecrash.co.uk/forum/ind...?showtopic=5642

zzg123 - Japan's HPI boom and deflation was in the face of a population that is double the UKs, so you have a point. However, the key I feel, lies with the immense debt to GDP ratio that Japan took on when it lowered interest rates and everything went haywire.

Government non-jobs and roads to nowhere to counter unemployment. Its the same statergy that is being used here by Brown. However, I don't think we are as fargone as Japan yet.

Japan has now reached many credit limits with rating agencies downgrading its government debt.

Edited June 29, 2005 by brainclamp

[MarkG]

Your point on population growth is a strong one.

So why are rents stagnant and why are there record numbers of houses for sale?

Why can't the bulls here answer such a simple question?

[brainclamp]

So why are rents stagnant and why are there record numbers of houses for sale?

Why can't the bulls here answer such a simple question?

<{POST_SNAPBACK}>

I did answer it earlier. Rents have been rising even in your case with inflation.

If there was such a glut then rents would have fallen. They have not fallen.

[Mog]

That means houseprices fall further out of the reach of the ordinary person, yet thanks to the tax position of investors, (borrowing thier forced savings at  negative real interest rates) they will be offered rents much cheaper than they could ever dream of buying. Eventually all of the housing stock will turn over to investors.

<{POST_SNAPBACK}>

OK, I've not said anything reading all your rants as they are in parts interesting.

But when you start saying things like "Eventually all of the housing stock will turn over to investors" I think I will stop reading.

I really thought you had some good points to make at one point, but now I'm not so sure. Personally I think you shot yourself in the foot there in terms of credibility.

[FTB]

... Your talking nonsense.

....Your the one in the dream world.

http://www.youre.co.uk

[flatfee]

soon savers will be rewarded as deflation comes on

inflation won't be around to save debters

its a 20-25 year bond cycle

[MarkG]

I did answer it earlier. Rents have been rising even in your case with inflation.

While house-prices have trebled. As I said, rents are stagnant.

If there was such a glut then rents would have fallen. They have not fallen.

My rent has fallen in real terms, as I pointed out before. In a period when house prices have trebled.

Why haven't rents trebled at the same time?

Ah, because there's an oversupply of houses and flats in this country and the trebling of house prices is purely a bubble due to artificially low interest rates and irrational crowd psychology.

[Mog]

While house-prices have trebled. As I said, rents are stagnant.

My rent has fallen in real terms, as I pointed out before. In a period when house prices have trebled.

Why haven't rents trebled at the same time?

Ah, because there's an oversupply of houses and flats in this country and the trebling of house prices is purely a bubble due to artificially low interest rates and irrational crowd psychology.

<{POST_SNAPBACK}>

I used to live in Bayswater 2 years ago and moved out because I didn't want to continue paying stupid amounts. I shared a 3 bedroom flat whose rent was 450/week. When we said we wanted to move out they said they would drop it to 400/week. We moved out anyway.

Now if that's not rents falling, I do not know what is. And that was 2 years ago. When things were ostensibly booming.

The rent on our current place has stayed the same for 2 years. Given inflation, that is a drop in real terms.

[brainclamp]

(1) Debt/mortgages will be acculumlated against houses even when prices stagnate and eventually all housing stock will turn over as this process continues.

THIS IS THE BOE's chief economists view.

(2) Its very easy to take this, and then, after examining the investors tax relief, tax breaks, financing against rents and the very real immense rise of Equity (up 200%) over savings (up 0%) for deposits, (it take 5 years for the average FTBer to save for a deposit) and new laboours removal of tax relief for FTBers and you can ssoon model very easily why rents are cheaper than buying.

So, Sure I make statements like "eventually all the housing stock will turn over to investors because rents will always appear cheaper than buying", as this is what is occurring right now, and, as long as this situation holds true.

Investors can always outbid you, and make money renting a place out to you even though the rents are cheaper than the best mortgage deal you can get, assuming you have saved for 5 years for a deposit.

In the past, BTLers owned all property, and nearly everyone rented. This was the situation pre 1915. The only difference was that they didn't get the immense tax relief and tax breaks they do now from the government!

[MarkG]

Yawn.