Jump to content
House Price Crash Forum
Sign in to follow this  
non-FTBer

Monopoly Money.

Recommended Posts

One thing I've noticed that seems to be a result of the booming HPI of recent years is that many people seem to have lost touch with the value of money.

When you work hard for money you value it and try to spend it wisely as it represents something that you have worked for.

When you MEW cash from a house that you own without doing any work it seems to be a lot easier to spend as you have not had to work for it. It seems like MEWed money gets spent like lottery winnings.

Also, I think the massive numbers involved in property prices now numb people to the huge figures they are talking about.

A £250K flat is not a bargain, even if it was £400K last year. £250K is still a QUARTER OF A MILLION POUNDS! That is a lot of money. Ignoring interest on a mortgage, it would take the average person (on average wage) more than a QUARTER of the money they will ever earn just to pay for it.

I, even though I have chosen not to participate in this madness, also seem to be mildly affected. I saw a property advertised for £160K recently and thought "Thats not too bad".... I was wrong. LR figures show that identical houses in the same street changed hands for as little as £98K in 2004.

It seems that all of these silly figures have affected peoples judgement.

I only noticed it when I viewed a flat recently and thought to myself what I would pay for it. It wasn't until I thought what I could buy with even just an extra £1K negotiated off that I realised I was subconciously affected.

I've also noticed that due to the 'keeping up with the Jones's' effect people seem to be spending stupid amounts of money on goods. Average people with average jobs buying 40 inch plasma TVs that cost up to £2K.... £2K is 1% of the value of a £200K house... its only a bl00dy TV. I've always made do with cheaper goods, as TV is not worth that much to me that I would spend any more than £300, and I don't intend to impress anyone with my purchases.

Anybody else feel the effects yet?

Share this post


Link to post
Share on other sites

It's amazing how quickly you can adjust to talking large figures. If you sit and think about what it takes to earn/save £1K, £10K it puts the fear in me and I'm on not too bad a salary. Perhaps we all ought to be come experts in the markets and not have to worry about such hum-drum things.

Share this post


Link to post
Share on other sites

One thing I've noticed that seems to be a result of the booming HPI of recent years is that many people seem to have lost touch with the value of money.

When you work hard for money you value it and try to spend it wisely as it represents something that you have worked for.

When you MEW cash from a house that you own without doing any work it seems to be a lot easier to spend as you have not had to work for it. It seems like MEWed money gets spent like lottery winnings.

Also, I think the massive numbers involved in property prices now numb people to the huge figures they are talking about.

A £250K flat is not a bargain, even if it was £400K last year. £250K is still a QUARTER OF A MILLION POUNDS! That is a lot of money. Ignoring interest on a mortgage, it would take the average person (on average wage) more than a QUARTER of the money they will ever earn just to pay for it.

I, even though I have chosen not to participate in this madness, also seem to be mildly affected. I saw a property advertised for £160K recently and thought "Thats not too bad".... I was wrong. LR figures show that identical houses in the same street changed hands for as little as £98K in 2004.

It seems that all of these silly figures have affected peoples judgement.

I only noticed it when I viewed a flat recently and thought to myself what I would pay for it. It wasn't until I thought what I could buy with even just an extra £1K negotiated off that I realised I was subconciously affected.

I've also noticed that due to the 'keeping up with the Jones's' effect people seem to be spending stupid amounts of money on goods. Average people with average jobs buying 40 inch plasma TVs that cost up to £2K.... £2K is 1% of the value of a £200K house... its only a bl00dy TV. I've always made do with cheaper goods, as TV is not worth that much to me that I would spend any more than £300, and I don't intend to impress anyone with my purchases.

Anybody else feel the effects yet?

I could not agree more. three and a half years ago we bought a new build house of £140k moving from our £78K semi. Even though we were massively within our mortgage budget I still worried about such a large morgage. Now three years on the house is valued at over £200K. This plays tricks on the mind - you start to look at £300K houses and think 'thats not bad'. Luckily I carry a wet fish around with me to give myself a sharp slap when this happens. Reality of the price insanity then returns. Its all fantasy wealth and I've not been fooled.

Share this post


Link to post
Share on other sites

One of the things that amazes me about MEW is how easily it is spent.

They think it is free money, but it isn't. MEW is just future earnings bought forward with a whole load of charges and risks associated with it.

But they spend it like its free money. Loads of new cars have been bought using MEW.

More BMW 3 series getting sold than Mondeos in the last few years.... crazy.

It seems that people only attach value to something if they have already worked for it. Unfortunately for them they will soon notice that MEWed cash has to be worked for and paid off eventually.

Funny to see how new car sales have come right down as the MEW taps have been turned off.... not too many 55 plate cars about :lol:

Share this post


Link to post
Share on other sites

unfortunately, my brother has fallen into this trap and no amount of talking will make him see sense.

He has remortgaged three times to release equity and is still in debt. Now there is nowhere else to go and the big bills are landing.

His case is not unique.

Debt will cause a crash - purely and simply. Unfortunately it will be painful for us all.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 337 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.