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Realistbear

Interesting Insights Offered By Fellow Bears In California

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http://lansner.freedomblogging.com/2009/09...th-month/35981/

The intertesting part is the debate between bulls and bears at the bottom of the artcile. Given that CA and the UK are mirror markets it is easy to see why the debate is so familiar.

One of the bears is even called "Liar Loan"--Eric's opposite number in the mirror?

http://www.housepricecrash.co.uk/forum/ind...ost&id=4113

Edited by Realistbear

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http://lansner.freedomblogging.com/2009/09...th-month/35981/

The intertesting part is the debate between bulls and bears at the bottom of the artcile. Given that CA and the UK are mirror markets it is easy to see why the debate is so familiar.

One of the bears is even called "Liar Loan"--Eric's opposite number in the mirror?

http://www.housepricecrash.co.uk/forum/ind...ost&id=4113

There is one huge difference - California has huge amount of land that can be built on. A friend has a big house (by UK standards) out there about an hour from Sacramento. The land value is apparently a mere $10,000 according to her tax statement. In the UK, land value is the key component of almost every property - the phrase "planning permission" is almost interchangeable with "gold mine".

However, I did enjoy reading the blog. I have often wondered where the US equivalent of HPC is.

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By mirror market, do you mean a 180 degree reflection where left is right, right is left and so on?

For if you mean that they are like one another then, RB, I have to disagree. California has seen 50% falls in house prices and even the sought-after places in the best bits of LA, San Fran and so on have seen huge falls - not seen any of that here in the UK.

I think we have got the Winter - just this Winter - or it might just not happen here for years to come. Unless we have another collapse on the scale of last year or, God forbid, something spokes the global economy such as a huge terrorist outrage then, well, we have got just this Winter.

If it hasn't happened by February 2010 then it may well not happen for 5 or 10 years.

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By mirror market, do you mean a 180 degree reflection where left is right, right is left and so on?

For if you mean that they are like one another then, RB, I have to disagree. California has seen 50% falls in house prices and even the sought-after places in the best bits of LA, San Fran and so on have seen huge falls - not seen any of that here in the UK.

I think we have got the Winter - just this Winter - or it might just not happen here for years to come. Unless we have another collapse on the scale of last year or, God forbid, something spokes the global economy such as a huge terrorist outrage then, well, we have got just this Winter.

If it hasn't happened by February 2010 then it may well not happen for 5 or 10 years.

I have to agree with you TMT - if it does not start to correct again by Nov/Dec then its just not going to - we are going to have bigger problems than just house prices - food will be the next problem.

RB - I am sorry but I think this notion you have hung onto that the UK somehow resembles the CA market just does not stack up - let it go. The non-recourse thing is a dead giveaway as to why the markets and the dynamics will never be the same.

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I noticed Merryn Somerset Webb's editorial in this week's Moneyweek was stating that if she had the time and the money she would now be buying a house in Florida.

Whilst reading that, and apologies to Merryn if I am wrong, I read between the lines and wondered how long it will be before one of her editorials admits that the UK housing market is just not crashing and is not going to crash?

I do think we have just this Winter and if there are not substantial price falls by Jan/Feb then come the Spring I suspect we will see price rises and the start of another fenzy. In my part of the World all the Public Sector jobs means there is little sign of the recession and, within 12 months, I can see the US leading the West out of recession so even the much talked about Public Sector cuts might well never materialise.

It angers me, it saddens me. I worked my balls of to earn my cash, as you all have done, and I look around S'sea at numerous people I know who have scammed, cheated and perhaps lied about their jobs, their incomes, etc, etc, to get big mortgages and live in very nice parts of S'sea - the s*ds are not losing their homes.... they are carrying on regardless.

Actually, to put it bluntly, this is not just about HPC anymore but it is about a whole way of work and life - why the feck did I go to all that trouble learning skills, spending years of my life away from home, on planes, on the motorways, wearing a suit in cr*ppy meetings with corporate drones when I should have just got a local authority job, mortgaged myself up to the hilt 10 or 15 years ago and let my house do all the work!

HPC - it has less than 6 months to happen or it will not happen IMPO.

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I noticed Merryn Somerset Webb's editorial in this week's Moneyweek was stating that if she had the time and the money she would now be buying a house in Florida.

Silly thing, Florida will be under water by the time she paid the mortgage off.

Stop being so sulky about the HPC, biggest boom in history took time, you know that every being done to prop the market up is temporary, gargantuan effort but ultimately futile.

Patience young padawan, patience...

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I noticed Merryn Somerset Webb's editorial in this week's Moneyweek was stating that if she had the time and the money she would now be buying a house in Florida.

Whilst reading that, and apologies to Merryn if I am wrong, I read between the lines and wondered how long it will be before one of her editorials admits that the UK housing market is just not crashing and is not going to crash?

I do think we have just this Winter and if there are not substantial price falls by Jan/Feb then come the Spring I suspect we will see price rises and the start of another fenzy. In my part of the World all the Public Sector jobs means there is little sign of the recession and, within 12 months, I can see the US leading the West out of recession so even the much talked about Public Sector cuts might well never materialise.

It angers me, it saddens me. I worked my balls of to earn my cash, as you all have done, and I look around S'sea at numerous people I know who have scammed, cheated and perhaps lied about their jobs, their incomes, etc, etc, to get big mortgages and live in very nice parts of S'sea - the s*ds are not losing their homes.... they are carrying on regardless.

Actually, to put it bluntly, this is not just about HPC anymore but it is about a whole way of work and life - why the feck did I go to all that trouble learning skills, spending years of my life away from home, on planes, on the motorways, wearing a suit in cr*ppy meetings with corporate drones when I should have just got a local authority job, mortgaged myself up to the hilt 10 or 15 years ago and let my house do all the work!

HPC - it has less than 6 months to happen or it will not happen IMPO.

If we look at this from a practical perspective:

- IR's are here to stay at ZIPR

- over 25% of people work in the public sector - they will not get lose their jobs for a while at least

- peoples mortgages are being paid by the gov for two years if they lose their jobs

In addition:

- there are loads of cash rich folk who sense that cash is going to be trash and want to buy something real

We are not going to get a HPC in less than 6 months or even a year unlss we have an event hat will trigger IR's to rise - if we do not then I think the bull trap theory just melts away and gives rise to something else. The govor the BoE will need to give a sign that cash will be supported - if they fail to do this by Xmas then the system will go down the sh1tter.

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Silly thing, Florida will be under water by the time she paid the mortgage off.

Stop being so sulky about the HPC, biggest boom in history took time, you know that every being done to prop the market up is temporary, gargantuan effort but ultimately futile.

Patience young padawan, patience...

The young padawan turned to the dark side and reigned for many decades before killing his old master - you too will have an Obi-wan Ben Kenobi beard before this HPC happens.

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It's always coldest just before dawn.

Houses in the UK are still preposterously overvalued. And the last couple of months have been a difficult time for those of us hoping for a complete correction.

There is only so much cash that the cash rich can throw at housing. They'll also want to throw some of it at equities, and commodities.

But in the end, UK house prices have to be supported by wages, lending and willingness to buy. A seed of doubt about house prices has been sown in the last couple of years. While the doubt has been sprayed with the herbicide of VI ramping this spring and summer, I really think that the germ has enough strength to see through to a proper correction.

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It's always coldest just before dawn.

Houses in the UK are still preposterously overvalued. And the last couple of months have been a difficult time for those of us hoping for a complete correction.

There is only so much cash that the cash rich can throw at housing. They'll also want to throw some of it at equities, and commodities.

But in the end, UK house prices have to be supported by wages, lending and willingness to buy. A seed of doubt about house prices has been sown in the last couple of years. While the doubt has been sprayed with the herbicide of VI ramping this spring and summer, I really think that the germ has enough strength to see through to a proper correction.

But there might just be enough cash buyers to keep the house price madness going until QE kicks in, until the West begins to recover, until the Tories get into power and the FTSE - it always soars in the first 12 months of a Tory Govt - soars even higher... and then there will be no house price crash... inflation will eat away the debt of the greedy and destroy the savings of the hard-working and prudent.

The US, Spain, Eire all having seen HUGE plunges in HPs but not the UK. Despite the LR and the Nationwide/HBOS figures few are seeing even the smallest drops in prices... in my part of the World vendors are putting UP their prices - what will it take for them to drop their new crazy asking prices back down to whether they were 3 months ago let alone to somewhere sensible?

Something major or something terrible is going to have to happen, and happen soon, for the UK housing market to tank.

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I noticed Merryn Somerset Webb's editorial in this week's Moneyweek was stating that if she had the time and the money she would now be buying a house in Florida.

Whilst reading that, and apologies to Merryn if I am wrong, I read between the lines and wondered how long it will be before one of her editorials admits that the UK housing market is just not crashing and is not going to crash?

I do think we have just this Winter and if there are not substantial price falls by Jan/Feb then come the Spring I suspect we will see price rises and the start of another fenzy. In my part of the World all the Public Sector jobs means there is little sign of the recession and, within 12 months, I can see the US leading the West out of recession so even the much talked about Public Sector cuts might well never materialise.

It angers me, it saddens me. I worked my balls of to earn my cash, as you all have done, and I look around S'sea at numerous people I know who have scammed, cheated and perhaps lied about their jobs, their incomes, etc, etc, to get big mortgages and live in very nice parts of S'sea - the s*ds are not losing their homes.... they are carrying on regardless.

Actually, to put it bluntly, this is not just about HPC anymore but it is about a whole way of work and life - why the feck did I go to all that trouble learning skills, spending years of my life away from home, on planes, on the motorways, wearing a suit in cr*ppy meetings with corporate drones when I should have just got a local authority job, mortgaged myself up to the hilt 10 or 15 years ago and let my house do all the work!

HPC - it has less than 6 months to happen or it will not happen IMPO.

You just have to accept it, Gordon may have stopped the HPC by printing lots of money, maybe he is not as stupid as some people on this forum think.

I have to say he seems a better man than Blair or Cameron.

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If we look at this from a practical perspective:

- IR's are here to stay at ZIPR

- over 25% of people work in the public sector - they will not get lose their jobs for a while at least

- peoples mortgages are being paid by the gov for two years if they lose their jobs

In addition:

- there are loads of cash rich folk who sense that cash is going to be trash and want to buy something real

We are not going to get a HPC in less than 6 months or even a year unlss we have an event hat will trigger IR's to rise - if we do not then I think the bull trap theory just melts away and gives rise to something else. The govor the BoE will need to give a sign that cash will be supported - if they fail to do this by Xmas then the system will go down the sh1tter.

Please explain the bold text above please?

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You just have to accept it, Gordon may have stopped the HPC by printing lots of money, maybe he is not as stupid as some people on this forum think.

Printy printy!

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It still remains to be seen if Gordon printing a load of money will keep prices up post GE.

Volumes are still a fifth of normal, no FTB's are buying, houses remain on the market unsold...

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The young padawan turned to the dark side and reigned for many decades before killing his old master - you too will have an Obi-wan Ben Kenobi beard before this HPC happens.

Looks like about 6 weeks to grow one of them ;)

Episode_3_Obi-Wan_Kenobi_2.jpg

Edited by D.C.

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Looks like a 1970's maths teacher IMPO.

The brutal reality is that there is little in common between the UK and Californian markets other than:

1. Both reached silly heights in terms of prices.

Other than that, the free market is being allowed to let US housing find its natural base. In the UK everything is being done to maintain ludicrous house prices.

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Surely wages are the key to this?

I was just reading another post linking to an article that pointed out that real wages in the US have effectively stagnated for a decade or more- sure, the impact was masked by easy credit and HPI based mewing- but the underlaying reality is that people's actual income has not kept pace with living costs, especialy housing.

So there are only two possible ways that the game can continue- either easy credit comes back or there are substantial wage rises all round- and neither of these looks very likely at the moment.

Inflation won't save the housing market unless wages can also be inflated. But we have this wonderful thing called a 'flexible' labour market. What's flexible about it?

Wage costs. :lol: They seem to have cunningly engineered a scenario where the one thing that could save them- wage inflation- has been designed out of the system to facilitate corporate profitability. Only now are the Goverenment belatedly waking up to the fact that wage arbitrage may not be the holy grail of wealth creation, and starting to look at some control on imported labour. But for a decade they danced to the corporate tune of low wages=growth.

Which was true, from a certain point of view. There were beneficiarys from globalisation, the top 10% became far richer as a result. But the system needs Joe Bloggs to consume as well as produce- and Joe Bloggs is tapped out- buried in debt and in no position to demand a wage rise- he's just feeling lucky to have a job at all.

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(...)

But in the end, UK house prices have to be supported by wages, lending and willingness to buy.

(...)

Or rents.

Which of course are supported by surplus income.

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Surely wages are the key to this?

I was just reading another post linking to an article that pointed out that real wages in the US have effectively stagnated for a decade or more- sure, the impact was masked by easy credit and HPI based mewing- but the underlaying reality is that people's actual income has not kept pace with living costs, especialy housing.

So there are only two possible ways that the game can continue- either easy credit comes back or there are substantial wage rises all round- and neither of these looks very likely at the moment.

Inflation won't save the housing market unless wages can also be inflated. But we have this wonderful thing called a 'flexible' labour market. What's flexible about it?

Wage costs. :lol: They seem to have cunningly engineered a scenario where the one thing that could save them- wage inflation- has been designed out of the system to facilitate corporate profitability. Only now are the Goverenment belatedly waking up to the fact that wage arbitrage may not be the holy grail of wealth creation, and starting to look at some control on imported labour. But for a decade they danced to the corporate tune of low wages=growth.

Which was true, from a certain point of view. There were beneficiarys from globalisation, the top 10% became far richer as a result. But the system needs Joe Bloggs to consume as well as produce- and Joe Bloggs is tapped out- buried in debt and in no position to demand a wage rise- he's just feeling lucky to have a job at all.

That is all very fine and may well be true but... what has it got to do with the UK and how it mean that UK house prices will follow Californian house prices?

Quite ironic really, an instance when the UK does not follow what happens in the US - very rare.

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That is all very fine and may well be true but... what has it got to do with the UK and how it mean that UK house prices will follow Californian house prices?

Quite ironic really, an instance when the UK does not follow what happens in the US - very rare.

The point is that we have followed the US in terms of opting for a 'flexible' labour force and unfettered wage arbitrage in terms of outsourcing and immigrant labour. It wasn't that long ago that Gorden Brown was going around europe touting the anglo saxon 'free market' model as the secret of eternal wealth.

Of course now they need to inflate, a bit of wage inflation would be just the ticket- but they have spent a decade setting up a scenario where wage inflation cannot easily happen, thanks to outsourcing and imported labour- a trend they positively encouraged.

I notice that our 'flexible labour force' is no longer a feature of much labour propaganda these days- it seems to have fallen out of fashion for some reason :P

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I have to agree with you TMT - if it does not start to correct again by Nov/Dec then its just not going to - we are going to have bigger problems than just house prices - food will be the next problem.

Last year some people were posting that food would run out by Feb 09, then June 09. Catastrophic economic collapse can happen (see Zimbabwe) but I don't see any short term problem in the UK or US.

- peoples mortgages are being paid by the gov for two years if they lose their jobs

Using what money? Surely the only money they have is hot off the presses.

It's always coldest just before dawn.

But it isn't warmest until the afternoon. House prices correction could be equally slow.

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I noticed Merryn Somerset Webb's editorial in this week's Moneyweek was stating that if she had the time and the money she would now be buying a house in Florida.

Whilst reading that, and apologies to Merryn if I am wrong, I read between the lines and wondered how long it will be before one of her editorials admits that the UK housing market is just not crashing and is not going to crash?

I do think we have just this Winter and if there are not substantial price falls by Jan/Feb then come the Spring I suspect we will see price rises and the start of another fenzy. In my part of the World all the Public Sector jobs means there is little sign of the recession and, within 12 months, I can see the US leading the West out of recession so even the much talked about Public Sector cuts might well never materialise.

It angers me, it saddens me. I worked my balls of to earn my cash, as you all have done, and I look around S'sea at numerous people I know who have scammed, cheated and perhaps lied about their jobs, their incomes, etc, etc, to get big mortgages and live in very nice parts of S'sea - the s*ds are not losing their homes.... they are carrying on regardless.

Actually, to put it bluntly, this is not just about HPC anymore but it is about a whole way of work and life - why the feck did I go to all that trouble learning skills, spending years of my life away from home, on planes, on the motorways, wearing a suit in cr*ppy meetings with corporate drones when I should have just got a local authority job, mortgaged myself up to the hilt 10 or 15 years ago and let my house do all the work!

HPC - it has less than 6 months to happen or it will not happen IMPO.

MT, I agree with you. The table is looking increasingly rigged.

I was in Swansea this week, and had a beautiful drive in, nice weather and the hills along the M4 looked stunning.

Popped into a shop to buy some lunch and people were busy shopping away. Meanwhile on the way in and parked up at the customer I visited I saw a load on 59 cars - so looks quite buoyant in Wales to me.

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MT, I agree with you. The table is looking increasingly rigged.

I was in Swansea this week, and had a beautiful drive in, nice weather and the hills along the M4 looked stunning.

Popped into a shop to buy some lunch and people were busy shopping away. Meanwhile on the way in and parked up at the customer I visited I saw a load on 59 cars - so looks quite buoyant in Wales to me.

Interestingly, last night some junk mail poppe through the letterbox and upon closer inspection it turned out to be the new Thomson phone directory - it is so thin I thought it was just some junk flyers.... perhaps an indicator of how small businesses are being hit in the area... but certainly not the Public Sector, many of those I know who work in the PS round here are oblivious to any recession and that is the vast majority...

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