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Us Price Falls Vs Uk Price Falls

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Could someone smarter than me please explain why US house prices are plummeting faster than ours?

I do understand that the US maybe entered recession earlier than the UK

I also understand that if you look at UK house prices in USD we have done worse than the US allowing for our currency depreciation

On the other hand our houses were/are much more expensive, went up more in the lat decade and, on the average, we owe more than each american

It seems to me things in the UK should be as bad as in the US

Or is it just:

- it will get that bad

- the US situation isnt as bad as it is made out in the UK press

Thanks, any postings from Americans in the UK or Brits over there would probably be interesting...

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Could someone smarter than me please explain why US house prices are plummeting faster than ours?

I do understand that the US maybe entered recession earlier than the UK

I also understand that if you look at UK house prices in USD we have done worse than the US allowing for our currency depreciation

On the other hand our houses were/are much more expensive, went up more in the lat decade and, on the average, we owe more than each american

It seems to me things in the UK should be as bad as in the US

Or is it just:

- it will get that bad

- the US situation isnt as bad as it is made out in the UK press

Thanks, any postings from Americans in the UK or Brits over there would probably be interesting...

Supply (of land and houses)is almost certainly a factor.

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(1) Brits have no entrepreneurial spirit or investing nous whatsoever – speculation on housing is the closest that 99% of the population have come to ‘investing’ since the last of the big utility privatisations. American housing speculators, upon realising that the party is over, were inclined to cut their losses and look for other places to make money. British housing speculators are more likely to want to ride it out and wait for the next housing bubble in 15 years’ time.

(2) Brits in negative equity aren’t able to simply hand their keys over and walk off into the sunset.

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Supply (of land and houses)is almost certainly a factor.

They do have more land and more houses, but they also have more industry, produce their own food/energy/oil and their currency is the world reserve. We import everything, make nothing and have a dwindling supply of north sea oil and also london as a financial hub :blink: . We haven't even started yet, I hope to be wrong but it doesn't look good.

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Supply (of land and houses)is almost certainly a factor.

Have you studied California? Restricted land supply, wealthy state (If your ignore their budget deficit :lol: ) massive boom and now massive bust.

The simple reasons for the UK is fairing better is huge latent positive sentiment for housing as a corner stone of a families wealth, low interest rates, Government owned banks that are holding back on repossessing and selling repossessed houses (hence massive increase in empty houses in the uk http://www.emptyhomes.com/).

Everything is being done to stem the fall of houses partly because we are near a general election and partly because our banking system would not cope with the right offs required if houses reached fair value let alone overshoot. Will it prevent a housing crash, I doubt it, will it lead to a very long depression, I suspect so which is likely to cause an even greater fall than had it been left to it's own devices but it may occur over a time frame that the banks can cope with as in Japan.

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(1) Brits have no entrepreneurial spirit or investing nous whatsoever – speculation on housing is the closest that 99% of the population have come to ‘investing’ since the last of the big utility privatisations. American housing speculators, upon realising that the party is over, were inclined to cut their losses and look for other places to make money. British housing speculators are more likely to want to ride it out and wait for the next housing bubble in 15 years’ time.

(2) Brits in negative equity aren’t able to simply hand their keys over and walk off into the sunset.

(1) true, americans do own more equities directly

(2) only in some states I believe, in others the bank can go after you

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There are enough people in this country who are still bullish about house prices to keep the price landslide at bay for a while. A lot of people think that the true value of property was set by by the peak reached in the boom of 2007 and that everything since then has been an anomaly from which we will 'recover'.

We don't have the shrinking city syndrome that the US has, although we did have in the past - Liverpool's population is only about half what it was in the 1930s. (1931: 856,000 , 2001: 439,000)

Edited by blankster

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