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One Of The Best Newspaper Articles On Property Prices I Have Ever Read

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One Of The Best Newspaper Articles On Property Prices I Have Ever Read.

It's probably been posted before - but this is a landmark article. Brilliant. Utterly brilliant. & It confirms my 7 years of bleating here on HPC:

House prices are not a function of demand, but are simply a function of how much money the lenders are willing to advance. Almost everything else is immaterial.

And - just add that LIAR LOANS have been the poison in the mud - providing false rocket-fuel to the "market" - and - well - that's the whole HPI Phenomenon summarised in one paragraph.

Read all here - & the comments after the article are very good too.

http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

Edited by eric pebble

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One Of The Best Newspaper Articles On Property Prices I Have Ever Read.

It's probably been posted before - but this is a landmark article. Brilliant. Utterly brilliant. & It confirms my 7 years of bleating here on HPC:

House prices are not a function of demand, but are simply a function of how much money the lenders are willing to advance. Almost everything else is immaterial.

And - just add that LIAR LOANS have been the poison in the mud - providing false rocket-fuel to the "market" - and - well - that's the whole HPI Phenomenon summarised in one paragraph.

Read all here - & the comments after the article are very good too.

http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

Its elucidated quite neatly in The Crash of 2008 And What It Means: The New Paradigm For Financial Markets by George Soros

essentially he postulates that asset bubbles are inflated partly by the willingness of 'banks' to lend against those assets

true enough in the case of houses in the UK, where the norm is to buy with the majority of the money (or even all of it and a bit more) being borrowed

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Great article Eric, thanks for posting.

How interesting that it is from the Guardian..

From out of all our newspapers, it was only the Guardian this week, who chose to make it worthy of front page news, that September had just seen the biggest monthly price drop ever.

Thsoe VI's must think it a good way of helping to silence the press, by blaming them for talking down the market, whilst all along those VI's must know the real truth is that people are now unable to get hold of those loans.

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Its elucidated quite neatly in The Crash of 2008 And What It Means: The New Paradigm For Financial Markets by George Soros

essentially he postulates that asset bubbles are inflated partly by the willingness of 'banks' to lend against those assets

true enough in the case of houses in the UK, where the norm is to buy with the majority of the money (or even all of it and a bit more) being borrowed

That Elite ilk have already admitted that they "know exactly what's going on" during a bubble!

They keep quiet about it and make a killing on the markets off the sheeple caught up in the collective madness and euphoria all whipped up by a vi elite-owned "media frenzy"!

Look @ all the MP's caught out at the height of it, flipping/buying and selling their properties! :angry:

Not one came forward to 'out' the selfish scams they were all up to - ripping off the taxpayer.

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I think this article has much to do with the fact that in Ireland there is talk of the sheeple suing the MSM for misleading articles which led to them being sucked into the hypetrain.

What chance do they have really?

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I think this article has much to do with the fact that in Ireland there is talk of the sheeple suing the MSM for misleading articles which led to them being sucked into the hypetrain.

What chance do they have really?

:huh: Er...... Have you read the article?? http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

I see no mention AT ALL about Ireland..... :wacko::wacko::wacko:

------------------:--

Meanwhile, in the real world, watch this: This poor guy TRIED to warn about what was going on - and, yes - he was made into a pariah - and frozen out.

The Broker Who Warned of the Crisis

http://www.youtube.com/profile?user=TheRealNews#p/u/3/NIXuTZBYyqY

Edited by eric pebble

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:huh: Er...... Have you read the article?? http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

I see no mention AT ALL about Ireland..... :wacko::wacko::wacko:

:blink: I never said it was. The article title is "falling-house-prices-blame-media" and it reminded me of the article in the Telegraph regarding "the-false-estate-did-property-journalists-mislead-investors" http://www.independent.co.uk/news/media/press/the-false-estate-did-property-journalists-mislead-investors-2058639.html

I see a bigger picture building.

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:blink: I never said it was. The article title is "falling-house-prices-blame-media" and it reminded me of the article in the Telegraph regarding "the-false-estate-did-property-journalists-mislead-investors" http://www.independent.co.uk/news/media/press/the-false-estate-did-property-journalists-mislead-investors-2058639.html

I see a bigger picture building.

Fair enough. Those "investors" haven't got a hope. They only needed to do a very simple sum:- Average property cost must-equal no more than 3.5 x [real, non-liar] average salary - and that should have warned them. A 15 year old GCSE Maths pupil could have told them that. :rolleyes:

Edited by eric pebble

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One Of The Best Newspaper Articles On Property Prices I Have Ever Read.

It's probably been posted before - but this is a landmark article. Brilliant. Utterly brilliant. & It confirms my 7 years of bleating here on HPC:

House prices are not a function of demand, but are simply a function of how much money the lenders are willing to advance. Almost everything else is immaterial.

And - just add that LIAR LOANS have been the poison in the mud - providing false rocket-fuel to the "market" - and - well - that's the whole HPI Phenomenon summarised in one paragraph.

Read all here - & the comments after the article are very good too.

http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

Agree. IMO the market got out of control for one overwelming reason: loose credit that encouraged banksterism and all of the associated scams inluding LIAR LOANS, IO, 125%LTV etc...................

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One Of The Best Newspaper Articles On Property Prices I Have Ever Read.

It's probably been posted before - but this is a landmark article. Brilliant. Utterly brilliant. & It confirms my 7 years of bleating here on HPC:

House prices are not a function of demand, but are simply a function of how much money the lenders are willing to advance. Almost everything else is immaterial.

And - just add that LIAR LOANS have been the poison in the mud - providing false rocket-fuel to the "market" - and - well - that's the whole HPI Phenomenon summarised in one paragraph.

Read all here - & the comments after the article are very good too.

http://www.guardian.co.uk/money/2010/aug/10/falling-house-prices-blame-media

Interesting comments section, a couple of people are suggesting that Japan has recovered, there's even an article linked by 'slurper' which suggests things are getting better but it's from 2005! Prices have continue down since then. Read what it says about the US market at the time! 'House prices always go up' is like a religion, just hold to this and everything will be OK.

Edited by council dweller

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Good article,

it feels like something is going to happen if we get QE and it rebounds again a good number of people will still be spooked as they will see that the market is manipulated and they will be thrown to the wolves as soon as the banks are ok.

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Eric, I enjoy your large colourful font as always! ;)

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What the article does confirm is that the estate agency business is populated with greedy ignorant bullshitters have proven themselves to be a menace to the economic fortunes of individuals and the nation as a whole.

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Erranta made a good point with regards to the MPs flipping their second homes etc etc to make a killing. These MPs are perfectly in the know about where house prices are going and I can bet that if the tax payer is now in line to profit from the MPs second homes (unlikely) then it must have also been signed into the expenses contract that 'we' the tax payer are going to underwrite any potential losses (highly likely) so the sheepie (not knowing it yet) have been mugged again lol I'd stake my HP car on that being the case.

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That Elite ilk have already admitted that they "know exactly what's going on" during a bubble!

They keep quiet about it and make a killing on the markets off the sheeple caught up in the collective madness and euphoria all whipped up by a vi elite-owned "media frenzy"!

Look @ all the MP's caught out at the height of it, flipping/buying and selling their properties! :angry:

Not one came forward to 'out' the selfish scams they were all up to - ripping off the taxpayer.

Over 100 MP's left the gravy train at the end of the last Parliament.

Almost all must have had second homes in London bought at the taxpayers expense.

If they've now gone back for good to Inverness/Cheshire/Hull or wherever, they'll be putting their London flat/house (always in a good area) on the market.

To crystallise the juicy tax free profit built up since they (we) bought it 4/6/7/10 years ago.

They certainly won't be carrying on paying a mortgage that we have always paid for them.

ANY TELEGRAPH JOURNO OUT THERE WANT TO TRACK A FEW MP's LONDON FLAT SALES TO TELL US JUST HOW WELL THE DEPARTED MP'S HAVE DONE FOR THEMSELVES?

AT OUR ******* EXPENSE.

Edited by juvenal

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and they will now even check whether you might have the resources to repay the mortgage. How extraordinary.

:D

Excellent.

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House prices are not a function of demand, but are simply a function of how much money the lenders are willing to advance. Almost everything else is immaterial.

Hmm. Not sure I totally agree with this one.

If there's no demand, you can provide as much finance as you like, but your product is still worth zilch.

What the article seems to be saying is that the demand has been artificially inflated by the media. Now I can see how this can work with, say, modern art & the like - in fact I'm sure it has (satirised most recently in Hary Enfield's "I saw you coming" sketches).

Housing, as with all life's necessities, has a demand irrespective of any media intervention. However, by continually trumpeting the increasing demand for any necessity you will inflate its relative value - espesially when, as with housing, that commodity is in short supply.

Anybody remember the Great Sugar Shortage of 1974??

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Agree. IMO the market got out of control for one overwelming reason: loose credit that encouraged banksterism and all of the associated scams inluding LIAR LOANS, IO, 125%LTV etc...................

Yes. But all of the above were based on low interest rates. Without it the sheeple would not even want the loans to begin with.

Notice that an increase of mortgage rates from 5 to 6% is an increase of 20%.

On an interest only mortgage, this is an increase of 20% on the monthly payments.

That reduces buyers' maximum "budget" by almost 20%.

That alone would have shaved-off the HP peak by almost 20%.

Interest rates + regulation would have prevented this bubble, easily. It was Gordon Brown's fault.

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To be more precise - MORTGAGES SET/DICTATE HOUSE PRICES.

Yes, in the short term, there is no doubt about it. Finance is the main factor influencing effective demand. (Wishes + ability to pay.)

In the long term however another big factor have influence too: the supply of housing. But it takes many years to build houses, and, NIMBYs... (see my sig...)

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Sorry I don't agree.

Demand has to be linked to rising house prices.

Even if it was just demand for the larger loans.

There is a demand for example to live in london, that has pushed up prices on there to way over the national average.

Don't recall banks saying, "ah you want to live in london? well lend you a higher multiple then".

As soon as there are 2 or more people interested in buying a property the price will be determined by who will pay the most. The bank didn't create 2 potential buyers for a house.

Simple fact is, rising prices are caused by a variety of factors, and the whole housing market is too complex for anyone to fully understand.

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As soon as there are 2 or more people interested in buying a property the price will be determined by who will pay the most. The bank didn't create 2 potential buyers for a house.

The banks were massively responsible of it due to being willing to supply the means for that price to be achieved. Without their complicity neither of those two buyers would've been able to pay as much as they did. The price would still have been determined by who would've paid the most, but the most would've been a lot less (and the willingness to pay top dollar even if they could afford it would've been less without the media- and bank-driven "Buy property" hysteria).

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Over 100 MP's left the gravy train at the end of the last Parliament.

Almost all must have had second homes in London bought at the taxpayers expense.

If they've now gone back for good to Inverness/Cheshire/Hull or wherever, they'll be putting their London flat/house (always in a good area) on the market.

To crystallise the juicy tax free profit built up since they (we) bought it 4/6/7/10 years ago.

They certainly won't be carrying on paying a mortgage that we have always paid for them.

ANY TELEGRAPH JOURNO OUT THERE WANT TO TRACK A FEW MP's LONDON FLAT SALES TO TELL US JUST HOW WELL THE DEPARTED MP'S HAVE DONE FOR THEMSELVES?

AT OUR ******* EXPENSE.

Don't be silly. They were only second homes from the point of view of getting more mortgage interest paid. The MPs don't really want to live in Inverness/Cheshire/Hull etc. (apologies to residents of those locations) with their "dear voters". They've finished that gravy train. Now they want a top job using all the contacts that they've made during their time in power, which means living in London.

Look for house sales in Inverness/Cheshire/Hull,

;)

Peter.

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Yes. But all of the above were based on low interest rates. Without it the sheeple would not even want the loans to begin with.

Notice that an increase of mortgage rates from 5 to 6% is an increase of 20%.

On an interest only mortgage, this is an increase of 20% on the monthly payments.

That reduces buyers' maximum "budget" by almost 20%.

That alone would have shaved-off the HP peak by almost 20%.

Interest rates + regulation would have prevented this bubble, easily. It was Gordon Brown's fault.

Australia is saying thats piffle, as long as people think the price of something will rise and somebody is stupid enough to lend to them, they will buy

Edited by Tamara De Lempicka

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  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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