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Channel 4 News: Is It Time To Burst The Housing Bubble?

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Is it time to burst the housing bubble?

It’s not news that there is a vast housing bubble in the south east of Britain. To Professor Danny Dorling, of Oxford University, the massive holdings in property by the rich and the not-so-rich threatens the future of the British economy. It also threatens the wellbeing of our citizenry. The average house in the once down-at-heel London borough of Hackney now costs £500,000.

Our Culture and Digital Editor Paul Mason has taken the professor to Hackney to look at the crisis, and to look for solutions. We’ll be debating the bubble and its threat to all our welfare.

I just watched this on channel 4 news, and they had 2 'experts' on who both agreed prices were too high, and the only argument was about how to best lower prices. Quite interesting for the MSM.

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Is it time to burst the housing bubble?

It's not news that there is a vast housing bubble in the south east of Britain. To Professor Danny Dorling, of Oxford University, the massive holdings in property by the rich and the not-so-rich threatens the future of the British economy. It also threatens the wellbeing of our citizenry. The average house in the once down-at-heel London borough of Hackney now costs £500,000.

Our Culture and Digital Editor Paul Mason has taken the professor to Hackney to look at the crisis, and to look for solutions. We'll be debating the bubble and its threat to all our welfare.

I just watched this on channel 4 news, and they had 2 'experts' on who both agreed prices were too high, and the only argument was about how to best lower prices. Quite interesting for the MSM.

Thanks for the link, can`t help feeling they are just managing expectations all the way, anyone who thinks this is sustainable really is living in cuckoo (or sheeple?) land IMO.

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caught this on 4+1 and the prof (Danny Dorling) seemed to speak so much sense I could not resist shouting 'absolutely right' at the TV - if he gets it why does no-one else (unless of course they do and it suits them to 'not get it')

the other chap seemed to be a one-trick pony - must build more houses (agree but that is only one side of the coin) and he did not seem to see that BTL and private renting and low interest rates were part of the problem

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Thanks for the link, can`t help feeling they are just managing expectations all the way, anyone who thinks this is sustainable really is living in cuckoo (or sheeple?) land IMO.

If you want to watch it, I assume it will appear on catch up in the next few hours.

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Is it time to burst the housing bubble?

It’s not news tha,.//...//

I just watched this on channel 4 news, and they had 2 'experts' on who both agreed prices were too high, and the only argument was about how to best lower prices. Quite interesting for the MSM.

AND -- of course....

THE ELEPHANT IN THE ROOM: HOW DID "PRICES" GET TO WHERE THEY ARE?

IT HAS ALL BEEN THANKS TO PREDATORY LIAR LOANS.

THE WEAPON OF MASSIVE DESTRUCTION DELIBERATELY UNLEASHED ON THE UNWITTING PUBLIC BY THE BANKSTERS.....

Edited by eric pebble

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We have a predatory liar banking system, backed by a predatory liar government and a predatory liar central bank.

There is not a stat they will not manipulate, rate they will not fix, promise they will not renage on and lie they will not tell to run this economy for the benefit of the very few against the best intersts of the majority in the long term.

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caught this on 4+1 and the prof (Danny Dorling) seemed to speak so much sense I could not resist shouting 'absolutely right' at the TV - if he gets it why does no-one else (unless of course they do and it suits them to 'not get it')

the other chap seemed to be a one-trick pony - must build more houses (agree but that is only one side of the coin) and he did not seem to see that BTL and private renting and low interest rates were part of the problem

Agree.

The 'other chap' is the Cityam 'free markets' City / SE shill. Hence why he doesn't care if private landlords skim £240bn profits in the last 5 years. They're his constituency. City was bankrupt until it was bailed out by the state so his arguments are the usual City VI bullsh1t .

He also re-inforced the 'London needs more houses 'cause it's growing so strongly' meme rather than asking why London is growing faster than the rest of UK and perhaps seeking to address the underlying problem of excess demand e.g. the real interest rate for London is too low and the real interest rate for the rest of UK is too high, relatively. i.e. It's the sterling zone which is also to blame. Growth in London needs to be rebalanced with the rest of the UK rather than perpetually seeking to increase demand for land in London where it's in short supply. Oodles of the stuff elsewhere.

Also shame they only talked about house prices in the house price / wages ratio and not the wages. Clearly higher wages would help in that.

Edited by R K

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hmnn.. runs out of steam...

summary... build more.... no wait building more won't solve it.... Landlords profiteering.... can't see how to stop it..... foreign buyers..... can't see how to stop it.

The rich media (property owning) elite win again.mad.gif

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caught this on 4+1 and the prof (Danny Dorling) seemed to speak so much sense I could not resist shouting 'absolutely right' at the TV - if he gets it why does no-one else (unless of course they do and it suits them to 'not get it')

the other chap seemed to be a one-trick pony - must build more houses (agree but that is only one side of the coin) and he did not seem to see that BTL and private renting and low interest rates were part of the problem

that makes a refreshing change from what I've found myself shouting these past twelve months.

i used to think the housing bubble needed a *****..little did i realise when it got one...he would just make it worse.

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Guest spp

and he did not seem to see that BTL and private renting and low interest rates were part of the problem

When you take lending at interest to be 'usury' low interest rates are not so much the problem. At the end of the day mortgage rates should be low due to the ability to repossess the property. The issue on the mortgage side of things is the low deposit requirement (interest only, 100% and now HTB!).

You shut off BTL/multiple ownership and you'll soon see more sensible prices. Making that 20% deposit much more attainable and the loan more secure.

The above would make for a much fairer society and stable financial system...shame the idiots 'in charge' don't see it that way!

The protests around the globe are taking place for a reason.

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When you take lending at interest to be 'usury' low interest rates are not so much the problem. At the end of the day mortgage rates should be low due to the ability to repossess the property. The issue on the mortgage side of things is the low deposit requirement (interest only, 100% and now HTB!).

You shut off BTL/multiple ownership and you'll soon see more sensible prices. Making that 20% deposit much more attainable and the loan more secure.

The above would make for a much fairer society and stable financial system...shame the idiots 'in charge' don't see it that way!

The protests around the globe are taking place for a reason.

This is the heart of it.

Taxing profits on the sale of personal homes. No more should property be the "go to" investment.

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We have a predatory liar banking system, backed by a predatory liar government and a predatory liar central bank.

There is not a stat they will not manipulate, rate they will not fix, promise they will not renage on and lie they will not tell to run this economy for the benefit of the very few against the best intersts of the majority in the long term.

Socialism!

No- not your comments-I agree with every word. I mean that the policies you describe are socialism- for the rich. Every resource will be thrown at the problem of how to prevent the pseudo wealth that has been amassed by property speculators disappearing back into the nothingness from which it came.

When Cameron talks about money being no object is he talking as much about property values as flood relief?- what happens if people start to work out that large swathes of southern englands housing stock is in danger of being literally underwater with increasing regularity in the future?

No wonder he has dragged the insurance companies into a meeting at number 10.

It would be funny if the black swan of HPI turned out to be an errant duck sitting on a floodtide.

Just edited to add this;

Flood-Soaked U.K. Homeowners Face Decline in Values: Mortgages

Patrick GowerFeb 19, 2014 7:53 am ET

Feb. 19 (Bloomberg) -- Homeowners in some of Britain’s wealthiest districts face a drop in property values and the prospect their homes may be uninsurable as record floods blight towns along the River Thames.

About 5,800 homes have been flooded in towns including Chertsey, Egham and Datchet after England endured its wettest January since 1766. Almost 55,000 homes with a combined value of about 21 billion pounds ($35 billion) are in areas that have been subject to severe flood warnings, according to real estate broker Savills Plc.

The repercussions for property asset values are absolutely huge,” said Hugh Fell, managing partner at property broker George F White LLP and a former member of the Royal Institute of Chartered Surveyors valuation board. Some homes have lost more than half of their value, making them “virtually unsellable,” he said.

No wonder 'money is no object' for Cameron- we are not just talking about flooded families and broken lives here- we are talking about something much more important than that- house prices!

Edited by wonderpup

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Guest spp

This is the heart of it.

Taxing profits on the sale of personal homes. No more should property be the "go to" investment.

Yes and no.

Multiple homes...maybe. On your single personal 'HOME'...NO...TAX is BAD! It more often than not only ends up down the state black hole of DEBT and does not stimulate the economy. It is a shame TAX has become so accepted.

Though I get your point, it should have been restricted it in the first place, so now how to deal with it.

When it comes to Food/water, energy and a single home (shelter)...tax, corruption, speculation, liar loans, financial WMD's and banksters out to make a quick buck should have always been met with fierce opposition. What the hell happened!

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Yes and no.

Multiple homes...maybe. On your single personal 'HOME'...NO...TAX is BAD! It more often than not only ends up down the state black hole of DEBT and does not stimulate the economy. It is a shame TAX has become so accepted.

Though I get your point, it should have been restricted it in the first place, so now how to deal with it.

When it comes to Food/water, energy and a single home (shelter)...tax, corruption, speculation, liar loans, financial WMD's and banksters out to make a quick buck should have always been met with fierce opposition. What the hell happened!

Taxing home sales is a bad idea, because it reduces home sales.

'Taxing' land use is better, because it discourages hoarding.

The reason that taxing land use is not bad in the way that other taxes are bad, is because the right to monopoly use of some land is a government benefit in the first place.

Holding large areas of particularly valuable land places costs on the people who now have to commute further, or set-up shop in a less desirable area. That's why people will pay you rent in order to access the land. However, it is only because of government that those costs can be unilaterally imposed, without agreement.

The rent is the cost imposed, the cost is imposed by government. In other words, land rent is already a tax.

Diverting some of that to central government doesn't actually increase the tax burden at all.

Edited by (Blizzard)

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Some homes have lost more than half of their value, making them “virtually unsellable,” he said.

it ought to be factored into the rightmove stats ;)

Edited by billybong

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If you are playing monopoly and you are able to create and lend at will, you can disguise the most ruinous of financial problems simply by creating unlimited amounts of money.

Suddenly, high rents and a high cost of living don't matter anymore because you can perpetually create new money. You can even lend it interest free to your mates. Now if you restrict who can turn the taps on and off to the state and its cronies, you have a situation that almost mirrors modern Britain. Money is no object if you or your friends control the printing press.

Of course, it's our labour which backs this unlimited credit tap, but eventually it becomes so unwieldy that it starts to distort everything around it to the extent that life becomes almost impossible for the ordinary person. I believe that's the situation we're now seeing. The wanton greed of the speculative class, even with unlimited bailouts and favours from the state, becomes impossible to sustain without either causing social unrest or bringing down the system or both.

Edited by Pindar

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Of course, it's our labour which backs this unlimited credit tap, but eventually it becomes so unwieldy that it starts to distort everything around it to the extent that life becomes almost impossible for the ordinary person. I believe that's the situation we're now seeing. The wanton greed of the speculative class, even with unlimited bailouts and favours from the state, becomes impossible to sustain without either causing social unrest or bringing down the system or both.

I like this analogy of speculative activity as a distortion field- I have this vision of a black hole of insatiable greed that eventually consumes everything around it.

In what sane universe is it possible for a hedge fund manager to make over a billion dollars in a single year? What the 'politics of envy' crowd fail to appreciate is that in order for that to happen a grotesque distortion of economic reality must have already occurred- and it's not 'envy' to point out that this is a dangerous to everyone- even the guy who benefits from the money.

Viewed strategically what the 1% seem to be engaged in is an attempt to extract the 'wealth' from what they see to be a failing model while leaving all it's liabilities in place- but don't understand that this is like attempting to catch the wind in a box- because what gives substance to all those financial 'assets' is the reality in which those liabilities exist- so while they can perform the abstract ritual of moving their 'wealth' offshore those digital accounts point always back toward the real world from which their value is ultimately derived.

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Socialism!

No- not your comments-I agree with every word. I mean that the policies you describe are socialism- for the rich. Every resource will be thrown at the problem of how to prevent the pseudo wealth that has been amassed by property speculators disappearing back into the nothingness from which it came.

When Cameron talks about money being no object is he talking as much about property values as flood relief?- what happens if people start to work out that large swathes of southern englands housing stock is in danger of being literally underwater with increasing regularity in the future?

No wonder he has dragged the insurance companies into a meeting at number 10.

It would be funny if the black swan of HPI turned out to be an errant duck sitting on a floodtide.

Just edited to add this;

No wonder 'money is no object' for Cameron- we are not just talking about flooded families and broken lives here- we are talking about something much more important than that- house prices!

I started thread on the article here

http://www.housepricecrash.co.uk/forum/index.php?showtopic=196870

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A decent segment, mentioned non-professional unprepared landlords with 10 properties, chasing a pension etc, also liked the comment saying "the only way to fix this is to suppress house prices and what politician will want do that?"

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Some homes have lost more than half of their value, making them “virtually unsellable,” he said.

[/Quote]

I would have thought it would have made them eminently more sellable. Or if they doubled in price would they be easier to sell? Is that how it works in this country?

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No wonder he has dragged the insurance companies into a meeting at number 10.

Yes and I bet that meeting was less about "are you making swift payouts" as reported and more along the lines of "I hope you arent planning to make millions of expensive houses un-insurable just before the next election"

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