juvenal Posted January 25, 2011 Share Posted January 25, 2011 (edited) File on Four 8pm - worth listening again. Transcript: Shapps: 'House price falls can be enormously damaging if they happen quickly. What would be helpful perhaps is if house prices were to go up perhaps at a lower rate than average earnings. Last year that probably more or less happened'. Presenter: But what if the prices did fall this year, say ten percent. A number of forecasters are saying that, and Roger Bootle is saying prices are twenty to thirty per cent too high. Shapps: The deeper it goes, the more damaging it is to people who are already on that housing ladder, and are perhaps in a difficult situation which could be made worse if interest rates start to rise. What I want is to live in a country whereby people can afford to buy or rent the most important thing in their lives, which is of course a secure roof over their heads, and, of course, not ending up in the kind of spiral that got us into this mess in the first place, with house prices booming. I conclude that Shapps is simply not interested in anyone not on 'the ladder' already. He has never indicated he wants lower prices. Edited January 25, 2011 by juvenal Quote Link to comment Share on other sites More sharing options...
7clubs Posted January 25, 2011 Share Posted January 25, 2011 That will be negative HPI, then.... Quote Link to comment Share on other sites More sharing options...
Beggar Thy Children Posted January 25, 2011 Share Posted January 25, 2011 I agree, but even if he did think it would be better to have them drop quickly, politically he could never come out and say it, it would be suicide. Much better (from his point of view) to acknowledge that they are too high, but suggest that a slow readjustment is in order to protect the overborrowed Quote Link to comment Share on other sites More sharing options...
Milton Posted January 25, 2011 Share Posted January 25, 2011 I conclude that Shapps is simply not interested in anyone not on 'the ladder' already. He has never indicated he wants lower prices. Maybe we should all re-train as criminals? Tried working hard. Taxpaying Productive member of society. But Apparently blatant Theft is the only way to get ahead in this country. Quote Link to comment Share on other sites More sharing options...
rantnrave Posted January 25, 2011 Share Posted January 25, 2011 I agree, but even if he did think it would be better to have them drop quickly, politically he could never come out and say it, it would be suicide. Much better (from his point of view) to acknowledge that they are too high, but suggest that a slow readjustment is in order to protect the overborrowed Shappsy is saying as much as he can without crossing the line. In a way, much as I want a HPC, it would leave a lot of people with even more serious financial problems than they have now. He can't go on the record as saying that would be a good thing. Quote Link to comment Share on other sites More sharing options...
lardboy Posted January 25, 2011 Share Posted January 25, 2011 Sounds like the proverbial "soft landing" that Ireland were going for. Worked out for them didn't it? Quote Link to comment Share on other sites More sharing options...
kilroy Posted January 25, 2011 Share Posted January 25, 2011 I agree, but even if he did think it would be better to have them drop quickly, politically he could never come out and say it, it would be suicide. Much better (from his point of view) to acknowledge that they are too high, but suggest that a slow readjustment is in order to protect the overborrowed How does that work when the overborrowed all head for the exit en masse? Quote Link to comment Share on other sites More sharing options...
Pytyr Posted January 25, 2011 Share Posted January 25, 2011 so at 2% earnings growth, how long would it take to get back to a 3.5 avg income/avg house price ratio? Quote Link to comment Share on other sites More sharing options...
Georgia O'Keeffe Posted January 25, 2011 Share Posted January 25, 2011 (edited) Sounds like the proverbial "soft landing" that Ireland were going for. Worked out for them didn't it? i dont know what peoples obsessions with politicians are on here, its like they are some sort of omnipotents. I doubt iceland wanted 20% interest rates a couple of years ago, i doubt ireland wants to be bankrupt, i doubt lamont wanted a currency crisis, i doubt Breown wanted to end his first year in charge with complete collapse of the banking sector, if the british economy can handle slow price falls or price increases it will happen, if it cant it wont, what ultimately happens will have fck all to do with shapps, cameron or the man in the moon, the market will dictate as always Edited January 25, 2011 by Tamara De Lempicka Quote Link to comment Share on other sites More sharing options...
benn Posted January 25, 2011 Share Posted January 25, 2011 So your £20K salary increasing annually by say 3% (£600) and annual HPI on a £150K house increasing annually at 2% (£3000) is OK? The graphs still end up diverging by £2400 in the first year. Planks. Quote Link to comment Share on other sites More sharing options...
Beggar Thy Children Posted January 25, 2011 Share Posted January 25, 2011 How does that work when the overborrowed all head for the exit en masse? Dont know, but whatever happens, Shapps can say he wanted a gentle readjustment Quote Link to comment Share on other sites More sharing options...
athom Posted January 25, 2011 Share Posted January 25, 2011 it doesn't matter what he wants, this situation where no one can afford to buy is totally unsustainable, we've had QE pumping money in, we've had bank of (the unwise) mums and dads bled dry. Now we've got negative growth, increasing borrowing rates regardless of base rate, negative jobs, negative earnings, negative optimism. Crash is coming* * unless the toerags pull another dirty trick out of the bag Quote Link to comment Share on other sites More sharing options...
Milton Posted January 25, 2011 Share Posted January 25, 2011 (edited) * unless the toerags pull another dirty trick out of the bag Id love to have tamara's faith in the market correcting itself, but I suspect the toe rags will do exactly that.... Edited January 25, 2011 by Dan1 Quote Link to comment Share on other sites More sharing options...
LiveinHope Posted January 25, 2011 Share Posted January 25, 2011 i dont know what peoples obsessions with politicians are on here, its like they are some sort of omnipotents. I doubt iceland wanted 20% interest rates a couple of years ago, i doubt ireland wants to be bankrupt, i doubt lamont wanted a currency crisis, i doubt Breown wanted to end his first year in charge with complete collapse of the banking sector, if the british economy can handle slow price falls or price increases it will happen, if it cant it wont, what ultimately happens will have fck all to do with shapps, cameron or the man in the moon, the market will dictate as always Quite so. Quote Link to comment Share on other sites More sharing options...
lardboy Posted January 25, 2011 Share Posted January 25, 2011 i dont know what peoples obsessions with politicians are on here, its like they are some sort of omnipotents. I doubt iceland wanted 20% interest rates a couple of years ago, i doubt ireland wants to be bankrupt, i doubt lamont wanted a currency crisis, i doubt Breown wanted to end his first year in charge with complete collapse of the banking sector, if the british economy can handle slow price falls or price increases it will happen, if it cant it wont, what ultimately happens will have fck all to do with shapps, cameron or the man in the moon, the market will dictate as always If they would just let the market take its course, everyone would be better off (with the exception of a few banksters). They love the market on they way up, but use all their might (and our money) to fight against it on the way down. Quote Link to comment Share on other sites More sharing options...
Beggar Thy Children Posted January 25, 2011 Share Posted January 25, 2011 Id love to have tamara's faith in the market correcting itself, but I suspect the toe rags will do exactly that.... Me too. The market will correct eventually. But I'm dead eventually. Nothing is off the table. If it will buy another couple of years of propping up house prices, well then frankly, impoverishing the next 3 generations down the line is a price worth paying. Quote Link to comment Share on other sites More sharing options...
fellow Posted January 25, 2011 Share Posted January 25, 2011 Sounds like the proverbial "soft landing" that Ireland were going for. Worked out for them didn't it? If it was possible to engineer a 'soft landing', they would have done it in the last crash, and the one before that....... Quote Link to comment Share on other sites More sharing options...
Superted187 Posted January 25, 2011 Share Posted January 25, 2011 link to show: http://www.bbc.co.uk/programmes/b00xppmm Quote Link to comment Share on other sites More sharing options...
jammo Posted January 25, 2011 Share Posted January 25, 2011 I heard on the news (6.25pm roughly) on the way home self cert mortgages being referred to as Liar Loans. I made a fist in salute to this going mainstream - or beginning to. That was the 6 o'clock news on radio 4 today. Quote Link to comment Share on other sites More sharing options...
Authoritarian Posted January 25, 2011 Share Posted January 25, 2011 (edited) It doesn't matter what Shapps wants, the housing market will dictate the terms, not him. Housing bubble collapses and their associated financial difficulties collapses finished off the Brown, Thatcher and Heath governments, and he's likely to become another victim -along with the rest of the country- if he doesn't get his act together and confront the housing VIs head on. Edited January 25, 2011 by Chef Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted January 26, 2011 Share Posted January 26, 2011 It doesn't matter what Shapps wants, the housing market will dictate the terms, not him. Housing bubble collapses and their associated financial difficulties collapses finished off the Brown, Thatcher and Heath governments, and he's likely to become another victim -along with the rest of the country- if he doesn't get his act together and confront the housing VIs head on. How can he confront them head on when they are behind him? May 2008 Shadow housing minister Grant Shapps admits taking donations from estate agent and four other firms connected with property industry Tory shadow housing minister Grant Shapps has been using money from an estate agent and property firms to run his private parliamentary office, the MP has admitted. In a letter to the Parliamentary Commissioner, Shapps said he had taken donations of more than £1,000 from five firms connected with the property industry to run his private office, despite the nature of his role. Shapps has led the Conservative campaign against the introduction of Home Information Packs. Hips are also violently opposed by the Estate Agency industry. The donations were from two online mortgage brokers, Charcol and Edeus Creators; Douglas & Gordon, a west London estate agent; the Sapcote Group, a commercial property developer; and Goldsmith Williams, a firm of solicitors that specialises in conveyancing and remortgaging. The money came to Shapps via Conservative central office, with donors expressing a desire the money should be used to fund Shapps’ office. http://www.building....3113864.article Quote Link to comment Share on other sites More sharing options...
Nationalist Posted January 26, 2011 Share Posted January 26, 2011 He's obviously trying to please everyone. Houses to go up in cash terms and yet become more affordable at the same time. This is a Goldilocks scenario for him. Unfortunately since, as MK said in his Newcastle speech yesterday, real wages are lagging behind inflation so this Goldilocks zone doesn't actually exist. Quote Link to comment Share on other sites More sharing options...
SarahBell Posted January 26, 2011 Share Posted January 26, 2011 That will be negative HPI, then.... One would have to assume that as they've said wage deflation is going to get worse Quote Link to comment Share on other sites More sharing options...
W1zard Posted January 26, 2011 Share Posted January 26, 2011 Is wage inflation trailing HPI by over 35%? Is that the correct figure? If King is saying wage inflation is expected to fall back to 2005 levels then this would create an even greater gap between HPI and wages. Quote Link to comment Share on other sites More sharing options...
stuckmojo Posted January 26, 2011 Share Posted January 26, 2011 After hearing Merv's speech about the fall in remuneration, Shapps' comments sounds quite appropriate. The truth is that he's got no chance but to spout political drivel. Too many "me huuse is me pension" types out there for him to tell the truth. Quote Link to comment Share on other sites More sharing options...
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