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jono2000

Prices Still Down Over The Long Term

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years. Which to be honest chimes with what's happening nationally. Of course there will always be pockets of winners and losers, ie Kensington London, versus Kensington Liverpool say.

www.telegraph.co.uk/finance/personalfinance/houseprices/10531165/House-prices-down-5pc-over-ten-years-in-real-terms.html

For an investment to be down 5pc over 10 years after inflation is taken into account (and to be honest inflation must be taken into account) is really not a stellar performance. Right now in london, whilst absolute prices are approaching the highes of 2007/2008 the inflation adjusted price are not.

Bubble? What bubble?

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Telegraph

Sorry mods if already posted.

No, hourly mention in the BBC news bulletin. Even better if you take London & the South East out of the mix.

UK house prices have fallen significantly when inflation is taken into account, countering claims of a bubble

UK house prices have fallen by 5pc in real terms over the last ten years when inflation is taken into account, dispelling fears of a house price bubble.

Some commentators fear that Government schemes such as Help to Buy and Funding For Lending have artificially pushed up house prices and risk creating a house price bubble.

But prices actually fell by 5pc over the ten years to the third quarter of this year when adjusted in line with the retail prices index, according to figures from Nationwide supplied to the Telegraph. Over a five year period, prices have fallen by 10pc in real terms.

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"Fallen in real terms" does not mean that they are cheaper. This is a rather disingenuous as wages have not been rising in line with inflation. As a result, the population has less surplus income to spend on house. In relation to take home wages, house prices have maintained their expense.

Also, to say that they have fallen a little bit does not mean that they are not in bubble territory.

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"Fallen in real terms" does not mean that they are cheaper. This is a rather disingenuous as wages have not been rising in line with inflation. As a result, the population has less surplus income to spend on house. In relation to take home wages, house prices have maintained their expense.

Also, to say that they have fallen a little bit does not mean that they are not in bubble territory.

Quite.It's a very localised story as well.

B11 is back to where it was in 2003 in nominal terms.

SW11 has doubled in that timeframe.

It wouldn't surprise me if this was reflected in the household disposable income of each postcode.Although I suspect anything in London has actually moved farther away from local median average wages than outside the M25.

SW7 has trebled and I think that pattern repeats itself around the more salubrious parts of the capital.

Edited by Sancho Panza

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years. Which to be honest chimes with what's happening nationally. Of course there will always be pockets of winners and losers, ie Kensington London, versus Kensington Liverpool say.

www.telegraph.co.uk/finance/personalfinance/houseprices/10531165/House-prices-down-5pc-over-ten-years-in-real-terms.html

For an investment to be down 5pc over 10 years after inflation is taken into account (and to be honest inflation must be taken into account) is really not a stellar performance. Right now in london, whilst absolute prices are approaching the highes of 2007/2008 the inflation adjusted price are not.

Bubble? What bubble?

I think when you live in a country with a balance of payments deficit, keeping up with inflation is not necessarily key

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Telegraph

Sorry mods if already posted.

No, hourly mention in the BBC news bulletin. Even better if you take London & the South East out of the mix.

Switching to real rather than nominal changes, is just a bubble denying tactic, to validate the various government schemes to prop up prices.

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years. Which to be honest chimes with what's happening nationally. Of course there will always be pockets of winners and losers, ie Kensington London, versus Kensington Liverpool say.

www.telegraph.co.uk/finance/personalfinance/houseprices/10531165/House-prices-down-5pc-over-ten-years-in-real-terms.html

For an investment to be down 5pc over 10 years after inflation is taken into account (and to be honest inflation must be taken into account) is really not a stellar performance. Right now in london, whilst absolute prices are approaching the highes of 2007/2008 the inflation adjusted price are not.

Bubble? What bubble?

*snort* well, I'm sure to the vast legions of people who intend on buying their house using stored computers, food, and electricity, this is wonderful news. To those of us relying on our wages, it's an irrelevant diversion at best.

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years. Which to be honest chimes with what's happening nationally. Of course there will always be pockets of winners and losers, ie Kensington London, versus Kensington Liverpool say.

www.telegraph.co.uk/finance/personalfinance/houseprices/10531165/House-prices-down-5pc-over-ten-years-in-real-terms.html

For an investment to be down 5pc over 10 years after inflation is taken into account (and to be honest inflation must be taken into account) is really not a stellar performance. Right now in london, whilst absolute prices are approaching the highes of 2007/2008 the inflation adjusted price are not.

Bubble? What bubble?

This might help you join the dots My link

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Switching to real rather than nominal changes, is just a bubble denying tactic, to validate the various government schemes to prop up prices.

That is what I thought, but my definition of a true bubble is sales volumes switch rammed to the max and price switch rammed to the max, that was the lead up to 2007, not now. What we have now is a deflating bubble in most of the country with volumes massively reduced and asking prices the only thing that is being pushed to the max as sheeple desperately hope to be bailed out of their debt. Outside certain London areas the days of "My house makes twice as much as me" are long gone.

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years. Which to be honest chimes with what's happening nationally. Of course there will always be pockets of winners and losers, ie Kensington London, versus Kensington Liverpool say.

www.telegraph.co.uk/finance/personalfinance/houseprices/10531165/House-prices-down-5pc-over-ten-years-in-real-terms.html

For an investment to be down 5pc over 10 years after inflation is taken into account (and to be honest inflation must be taken into account) is really not a stellar performance. Right now in london, whilst absolute prices are approaching the highes of 2007/2008 the inflation adjusted price are not.

Bubble? What bubble?

Yes, I see where you are going with this.

Firstly, and without sarcasm, the fact that this thread began shows that there is no groupthink by the hpc mods. Anyone who has been reading these boards for more than 3 months will know chapter and verse regarding how to tear the *rse off these banal arguments.

Secondly, try buying a house in the South East with less than 10x local median earnings today. And try that 30 years ago. And tell me about the lack of inflation.

Thirdly, "highes" really?

Fourthly, inflation of what? Median earnings or petrol?

Fifthly, really Kensington Liverpool vs Kensington London? Pockets of winners and losers? You think that you get it. You think that you are convincing. But you just don't get it.

Our houses cannot make us richer. All our houses can do is get old and demand that they are repainted and that their gutters are cleaned. What you inadvertently refer to is the brute fact that if the housing supply is static whilst housing demand increases, all things being equal, then you have an asset (houses) and the asset price for that asset (house prices) will move.

But how does that work out? If incomes grow but the supply of housing remains fixed then house prices rise but the same income buys you less house. Still at least some NIMBY has a nice view and cheap land on which to exercise a f**cking horse - or play golf.

However - can we be certain that as the price responds to the supply constraint and rises and is bid up by cheap credit - how can we be sure that the price stops rising at the point wherein the assessment of buyers regarding what they should pay neatly matches what (given 20/20 hindsight) they should have paid? After all, we're talking about high-LTV interest only and BTL here. These people are not Warren Buffet...

You know what I think...

They 'paid' too much.

They 'paid' more than they can ever repay.

The promises were delivered broken.

Right now we are just 'caught in the middle'. We're looking around to see how many f*ckwits are left willing to sign on the dotted line for excruciating debt terms in order to 'own' shit houses.

Who cares? I don't. Renting is so cheap compared to the risks inherent in ownership. Tomorrow is a promise to no-one.

Edited by ChairmanOfTheBored

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Yes, I see where you are going with this.

Firstly, and without sarcasm, the fact that this thread began shows that there is no groupthink by the hpc mods. Anyone who has been reading these boards for more than 3 months will know chapter and verse regarding how to tear the *rse off these banal arguments.

Secondly, try buying a house in the South East with less than 10x local median earnings today. And try that 30 years ago. And tell me about the lack of inflation.

Thirdly, "highes" really?

Fourthly, inflation of what? Median earnings or petrol?

Fifthly, really Kensington Liverpool vs Kensington London? Pockets of winners and losers? You think that you get it. You think that you are convincing. But you just don't get it.

Our houses cannot make us richer. All our houses can do is get old and demand that they are repainted and that their gutters are cleaned. What you inadvertently refer to is the brute fact that if the housing supply is static whilst housing demand increases, all things being equal, then you have an asset (houses) and the asset price for that asset (house prices) will move.

But how does that work out? If incomes grow but the supply of housing remains fixed then house prices rise but the same income buys you less house. Still at least some NIMBY has a nice view and cheap land on which to exercise a f**cking horse - or play golf.

However - can we be certain that as the price responds to the supply constraint and rises and is bid up by cheap credit - how can we be sure that the price stops rising at the point wherein the assessment of buyers regarding what they should pay neatly matches what (given 20/20 hindsight) they should have paid? After all, we're talking about high-LTV interest only and BTL here. These people are not Warren Buffet...

You know what I think...

They 'paid' too much.

They 'paid' more than they can ever repay.

The promises were delivered broken.

Right now we are just 'caught in the middle'. We're looking around to see how many f*ckwits are left willing to sign on the dotted line for excruciating debt terms in order to 'own' shit houses.

Who cares? I don't. Renting is so cheap compared to the risks inherent in ownership. Tomorrow is a promise to no-one.

Jono is a property develope

http://www.housepricecrash.co.uk/forum/index.php?showtopic=195516&pid=1102437328&st=50entry1102437328

But you knew that.

Edited by 7 Year Itch

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Using inflation adjusted figures it turns out that house prices aren't up at all. No, in fact, they are down 5pc over 10 years.

Bubble? What bubble?

10 years isn't long term.

And 10 years ago was indeed the height of the bubble, and so a startingpoint from which any sane market would be down. Not quite the nominal top, but the real top: it was the second half of 2004 when prices started to flatline, the smart money started to pull out, and government intervention moved from ramping to firefighting.

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10 years isn't long term.

And 10 years ago was indeed the height of the bubble, and so a startingpoint from which any sane market would be down. Not quite the nominal top, but the real top: it was the second half of 2004 when prices started to flatline, the smart money started to pull out, and government intervention moved from ramping to firefighting.

So, house prices have gone down against an index which includes house prices?!

*confused*

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[quote name='ChairmanOfTheBored' timestamp='1387756248' post='1102437287'

Our houses cannot make us richer.

Collectively that's true. But since when have we been a collective?

In 1995 I bought a detached house in the south east; my sister bought a semi in the north west; and a friend took an enormous gamble, mortgaged himself to the hilt, and bought a massive house in Notting Hill.

All three of us had similar backgrounds, similar educations, and similar careers. However, those housing decisions have made me richer than my sister, and turned the friend with the six bedroomed house in Notting Hill into a multi-millionaire!

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