Global House Prices: Are They About To Plummet?

[Guest consa]

Global house prices: are they about to plummet?The Economist recently looked at house-price indicators for 16 developed economies. Their conclusion was that prices are now at 'record levels in relation to average wages and rents' in America, Australia, Britain, Ireland, the Netherlands, New Zealand and Spain', and 'frothy' in China, South Africa and Dubai. Not only that, but even in traditionally sober markets, like those in France and Italy (where home ownership is not considered the be-all-and-end-all of life, as it is here), prices have risen at double-digit speeds in the past year as well. So what's made this extraordinary and co-ordinated move happen? The answer is simple: super-low interest rates.

As the Economist also noted, 'the average short-term interest rate in the G7 economies is at its lowest in recorded history'. And low rates mean high house prices. This is because so many house buyers care only about what it will cost per month to service the debt; as falling rates mean falling interest payments they'll buy more expensive houses. But when everyone does this, the result is merely that all house prices rise. Simply put, if rates halve, house prices double.

http://info.moneyweek.com/sample.php?p_id=...prices+uk+crash

[BoredTrainBuilder]

http://info.moneyweek.com/sample.php?p_id=...prices+uk+crash

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Very interesting, but why post an article over a year old?

[oracle]

And if global house prices do plummet,then what is going to be taking it's place as the next bubble?????????????commodities is certainly a possibility.

bubbles do have a habit of following one after another.

[Kam]

And if global house prices do plummet,then what is going to be taking it's place as the next bubble?????????????commodities is certainly a possibility.

bubbles do have a habit of following one after another.

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So what do people think will be the next bubble

Gold / platinium?

Renewable energies?

Space travel / off world mining?

or good ol' stock market?

[AgeingBabyBoomer]

OIL,

Renewable energies are not well enough developed to replace oit just yet.

You can't run an airliner on solar power, and I have no idea how many acres of oilseed rape would need to be harvested for one flight to NY.

So while there is no full replacement, prices will rise, speculators will rush in, pushing it higher.

It won't burst until we can see the bottom of the last barrel.

Hopefully, I will be in the next world by then.

Good enws is renewable energy is more suited to the personal user, so a house with some land and

some high tech renewable generation would be a very sound investment (after the crash of course :DD)

ABB

[Guest consa]

Very interesting, but why post an article over a year old?

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Thought I had seen it before , anyway good for the new members to see again as it was a good article