zugzwang Posted April 9, 2015 Share Posted April 9, 2015 T'is is true but is the 5 year gilt yield not affected by the actions of the BoE, or vice versa? Probably not really worth getting too technical about it as all I wanted to say is that mortgage rates were low and they damn well went lower! Making Joe public think that anyone renting is a fool when getting a mortgage is so cheap! Doombrose suggesting tonight that a gilt strike by foreigners is now calling into question the long-term stability of sterling. Please let it be true! http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/ Quote Link to comment Share on other sites More sharing options...
Guest TheBlueCat Posted April 9, 2015 Share Posted April 9, 2015 I'm beginning to worry that the 'market' can remain irrational longer than I can remain alive. It's true and very sad. We're now into the 7th year of what feels like a never ended effort to prop up markets that should have been allowed to crash through the floor. Any pain that would have come from allowing things to correct naturally in 2008 would have been way less that what's coming down the pipe added to what an entire generation of brits under 40 have already sucked up. It's not going to be pretty when it does finally blow. FWIW, my bet is on 2045 as being the year when the wheels fall off the bus just about everyone on the planet at once - I'll be unlikely to see it myself, but maybe some data archeologist will give me posthumous credit for calling it first. Quote Link to comment Share on other sites More sharing options...
canbuywontbuy Posted April 9, 2015 Share Posted April 9, 2015 If all is going so well why do we need all the crazy initiatives to keep the economy going? Over 6 solid years of 320 year record low base rates....and yet we're told we're in a sustained, robust recovery. But....just don't raise interest rates (a sure sign of an ACTUAL recovery) - no....don't do that. Talk about denial. Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted April 9, 2015 Share Posted April 9, 2015 Patience. Central bankers haven't eliminated the business cycle. 7 years since last recession. We're due one soon enough. The business cycle though pales into insignificance when compared to having outright manipulated the markets to a point of losing whole industrial sectors when nearly every other country in the world that has even a toe in the industrial waters can outcompete those countries that decide to go for fake economies like ours. The siginificance, and long term nature of their meddlling is beyond anything to do with the business cycle. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted April 9, 2015 Author Share Posted April 9, 2015 The business cycle though pales into insignificance when compared to having outright manipulated the markets to a point of losing whole industrial sectors when nearly every other country in the world that has even a toe in the industrial waters can outcompete those countries that decide to go for fake economies like ours. The siginificance, and long term nature of their meddlling is beyond anything to do with the business cycle. ...and is likely to result in a very very bad crash, not just in house prices!!!! Quote Link to comment Share on other sites More sharing options...
shindigger Posted April 9, 2015 Share Posted April 9, 2015 Doombrose suggesting tonight that a gilt strike by foreigners is now calling into question the long-term stability of sterling. Please let it be true! http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/ Vote Labour darlings. Quote Link to comment Share on other sites More sharing options...
Sandwiches33 Posted April 9, 2015 Share Posted April 9, 2015 ...and is likely to result in a very very bad crash, not just in house prices!!!! This is my fear, cheap houses might be the last thing on our mind! Forced bank holidays, insolvent UK, unpaid gov employees and hysterical population unable to buy stuff. I dread to think, I hope its just paranioa, maybe I should be on here less Quote Link to comment Share on other sites More sharing options...
renting til I die Posted April 9, 2015 Share Posted April 9, 2015 It's true and very sad. We're now into the 7th year of what feels like a never ended effort to prop up markets that should have been allowed to crash through the floor. Any pain that would have come from allowing things to correct naturally in 2008 would have been way less that what's coming down the pipe added to what an entire generation of brits under 40 have already sucked up. It's not going to be pretty when it does finally blow. FWIW, my bet is on 2045 as being the year when the wheels fall off the bus just about everyone on the planet at once - I'll be unlikely to see it myself, but maybe some data archeologist will give me posthumous credit for calling it first. Just in time for me to buy a retirement property! If I'm still about! Quote Link to comment Share on other sites More sharing options...
olde guto Posted April 9, 2015 Share Posted April 9, 2015 For real ? For me we are at peak madness now. How long they can support the bubble at this level before it collapses is what I wonder. I remember in 2002ish some economist type on BBC news saying that house prices were too high and this couldn't go on forever, took another 5 years for the correction to happen (well it would have if it wasn't for ultra low IRs). I also remember thinking back then it can't go on for much longer... The problem is that the government isn't just propping-up house prices to keep people docile it's that they want to use equity in housing to pay for the care of the elderly. The DM and DE mither about houses being sold for care costs but are too greedy and stupid to realise that an HPC would force the government to think again. The madness has to come to an end, but I've no idea when, it could be at breaking point now, it could take another 5 years. Quote Link to comment Share on other sites More sharing options...
Exiled Canadian Posted April 9, 2015 Share Posted April 9, 2015 I think the Crash will come when a significant number of baby boomers will start having to go into sheltered accomodation and care. My father was born in 1944 (early boomer I guess). He and my Mum have started planning for their "next move" as they call it; but I suspect that it is at least 5 years off (barring some unexpected health emergency). Their plan is to sell their 3 bed house to fund their care (to their credit they are not trying to come up with schemes to fleece the state). I suspect that it will be 5 to 10 years before a significant number of baby boomers become forced sellers for this reason. In the absence of a "black swan" or a government withdrawal of the market methodone this may set the time horizon. In the long term macro-economics is all demographics,,,,,,, Quote Link to comment Share on other sites More sharing options...
dances with sheeple Posted April 9, 2015 Share Posted April 9, 2015 as others have said, giving up is not really an option if you stay.. My fear is that when we do crash, there will be enough people desensitised to the sums at play and with free money (made in the last few years of HPI/BTL probably..or even foreign money) to just make it go boom all over again. That is my fear. We may well get our crash, but people have had 15 years to accumulate untold wealth, and to try convince them its going to be different is going to be a mammoth task Outer London houses at £120k? I'll take 4 thanks. No, the only option is to opt-out. I'll leave the country, remove myself from this poker table and wherever I end up I dont care as long as house prices are not spoken of ever again. I am actually sick....honestly...when I hear someone talk about a home, but use the word "property", I have to muster up every ounce of restraint to not shout at them Not ordinary people, most of them are skint? Quote Link to comment Share on other sites More sharing options...
SNACR Posted April 10, 2015 Share Posted April 10, 2015 and don't even get me started on fine art but the classic car market is word for word the housing market. We are not insane everyone else is I think I've mentioned before the other parallel with the classic car bubble is barn finds, needing enormous amounts of restoration work, sell at a disturbingly small discount. Interesting distortions have gone on. I know of quite a lot of nice but dim proper upper middle class types that used to live off inheritamce savings interest. Although, generally fairly out of touch with reality, a lot of them were acutely aware that eating into capital was an issue. Frankly, some of the harebrained investments and schemes some have sunk their money into is jaw dropping. At the moment there hasn't of yet, that I've seen, been any genuine discussion about what true effect years of low interest rates has had on the savings and investment landscape and what it means for the future. Quote Link to comment Share on other sites More sharing options...
Steppenpig Posted April 10, 2015 Share Posted April 10, 2015 there hasn't of yet, that I've seen, been any genuine discussion about what true effect years of low interest rates has had on the savings and investment landscape and what it means for the future. Never mind that, tell us more about what idiocy your stupid friends have been up to. Quote Link to comment Share on other sites More sharing options...
Venger Posted April 10, 2015 Share Posted April 10, 2015 (edited) It certainly feels like that but I'm preparing for it to get worse. With IR's at 0.5%, mortgage rates have been tumbling, much to my surprise! Monthly mortgage repayments are what your average joe look at and they are at the most affordable levels for the past 20 odd years! Throw in a little more HTB and I can see the UK housing Ponzi running for a few more years yet. Of course it could come to an abrupt end if a black swan emerges from somewhere but seeing as we can't start to predict where one of those will come from, we just have to deal with the facts at hand. That is, that the government will prop at any cost. Even though some younger people are switching off housing, many others will attempt to buy at any costs and there are also many older people that don't understand how weak the yields are on rental properties and the other associated risks, will carry on building their BTL portfolios. Sorry to say this but I would strap yourself in for a long haul! Maybe we can finally reach a stage where there are a lot fewer 'buyers are victims' as per year after year, accompanying each happy buyer article... all the way back to early 2008 and years earlier too from reading - and instead think of those who want/need hpc. Put them first. It's not our fault if others happily paying £50Ks-£100Ks more than we're willing to pay, and grinning in the paper at how they never thought they would be able to buy it so cheaply... or saying that renting is dead money etc. Accept we make our own decisions and it's not all about protecting buyers/homeowners.. that there are also tragic circumstances on the non-owner side. All the apologies for the buyer side is like cheering on the VI and HPI. We might not be able to predict which Black Swan, but I like the forum for examining all the even increasing number of places one could come from. Dealing with facts at hand would be even more demoralising without projecting where a market changer could come from. House prices have hit the bottom and the only way is upBad news for first time buyers: "the housing market has now bottomed out" ahead of the general election, say economists By Anna White, Property correspondent 9:47AM BST 09 Apr 2015 http://www.telegraph.co.uk/finance/property/house-prices/11524328/House-prices-turn-a-corner-ahead-of-general-election.html Console myself that journo-experts don't know much, still cheering things on at extremes - just before collapses. I remember the Midas piece for the follow up below. It was brimming-over and drooling with positivity for Marconi's outlook. It was followed shortly afterwards, a few weeks later, with a grim apology by the columnist, after price had collapsed... and from memory, time of wider tech bubble collapsation, finding out a few tech investors who were millionaires in equity on paper (not in cash). Values are set at the margin, and can fall when other buyers/sellers suddenly decide to trade at much lower prices. (Below isn't me). 09-07-2001 http://boards.fool.co.uk/the-midas-touch-6660496.aspx Edited April 10, 2015 by Venger Quote Link to comment Share on other sites More sharing options...
Venger Posted April 10, 2015 Share Posted April 10, 2015 (edited) Interesting. ANECDOTAL ALERT! In last week (presumably due to Easter) I've noticed a raft of mid-market detacheds that I know have been "accidental" rentals over the last 4 or 5 years come on for sale. Prices v similar to or slightly above original asking. Bearing in mind this is top end NW not SE. Funnily enough there's an agent valuing next door as I write. He was easy to spot due to the Merc CLS. So similar to your observation - increasing supply at same or slightly higher prices. Looks like the "ripple effect" to me. So the seeming prospect of higher prices bringing out supply to market... competing with more supply/sellers, which may in turn be a hpc trigger imo, as others accept less, and accidental rentals need to find new tenants.. attrition that others cutting prices. Crack up before crash. I've seen many a higher end home on rental market with lots of void months... must be a cost involved for many such accidental landlords. This house around your way up for sale, onto the market in Feb, and wouldn't take much to flirt back to price they paid for it in 2010 (imo), seems a bit weird. http://www.rightmove.co.uk/property-for-sale/property-48255709.html The current owners seem to have more poverty spec approach than the former owners... maybe a sign they didn't have much money left over after buying it in 2010.. even moving in some big old grandfather clock... oh they've moved the slide in the garden... obviously deserve a few extra £10Ks. 2010 listing pics http://www.rightmove.co.uk/house-prices/detailMatching.html?prop=23533318&sale=44180630&country=england Edit to correct the link to last sold price/archived pics. Edited April 10, 2015 by Venger Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted April 10, 2015 Author Share Posted April 10, 2015 http://news.bbc.co.uk/1/hi/business/3032925.stm Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted April 10, 2015 Author Share Posted April 10, 2015 (edited) What gets me is than many, even on here, talk like the current mega bubble prices are normal and affordable. There prices have been inflated from a massive bubble that destroyed the banking system. The government is now the banking system. when it collapses again we have big problems.the government has created this bubble with Crazy schemes and a low interest rate money give Away. I suspect this is mostly desperate sub prime lending. There is nothing normal about current prices. The london Mega bubble is truly insane. How can this continue. who is buying? Who can buy anymore? Edited April 10, 2015 by TheCountOfNowhere Quote Link to comment Share on other sites More sharing options...
bankstersparadise Posted April 10, 2015 Share Posted April 10, 2015 I think the Crash will come when a significant number of baby boomers will start having to go into sheltered accomodation and care. My father was born in 1944 (early boomer I guess). He and my Mum have started planning for their "next move" as they call it; but I suspect that it is at least 5 years off (barring some unexpected health emergency). Their plan is to sell their 3 bed house to fund their care (to their credit they are not trying to come up with schemes to fleece the state). I suspect that it will be 5 to 10 years before a significant number of baby boomers become forced sellers for this reason. In the absence of a "black swan" or a government withdrawal of the market methodone this may set the time horizon. In the long term macro-economics is all demographics,,,,,,, Agree demographics are incredibly important. Unfortunately the echo-boom (ie you and me - 1987 born myself) means the demographics don't start to work against the housing market until 2045 onwards, not withstanding world war 3 or a plague. Quote Link to comment Share on other sites More sharing options...
Guest_growlers_* Posted April 10, 2015 Share Posted April 10, 2015 (edited) You're all so negative. Seems to me we are at the end of the boom and everyone knows it. Crash might take two years to play out but it's so obviously on the cards. I personally am looking forward to two years of commuting to work reading how much I've 'made' in property each month by not owning. Edited April 10, 2015 by growlers Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted April 10, 2015 Author Share Posted April 10, 2015 You're all so negative. Seems to me we are at the end of the boom and everyone knows it. Crash might take two years to play out but it's so obviously on the cards. I personally am looking forward to two years of commuting to work reading how much I've 'made' in property each month by not owning. It's been obvious for 7 years but they prop it up some more and people buy into it. They managed to sustain prices for 3 or 4 years after the 2007/2008 crash at an unnatural level ( have a look at the land registry graph ), maybe they are hoping they can do they same at this new higher level. Crazy but I would guess this is their plan. They can milk people for taxes for years now and the banks can profit massively. it will take the people to say enopugh is enough, maybe the young already are. Quote Link to comment Share on other sites More sharing options...
Agentimmo Posted April 10, 2015 Share Posted April 10, 2015 it will take the people to say enopugh is enough, maybe the young already are. I'm an not-too-young who has had enough. Been "on strike" from buying since 2005/6. I refuse to buy into the madness. More and more people I know are thinking likewise. Quite a few refuse to trade-up since 2010, believing the extra 100-300K it will cost them to be crazy. They'll keep their earnings , thank you very much.... Quote Link to comment Share on other sites More sharing options...
dances with sheeple Posted April 10, 2015 Share Posted April 10, 2015 (edited) What gets me is than many, even on here, talk like the current mega bubble prices are normal and affordable. There prices have been inflated from a massive bubble that destroyed the banking system. The government is now the banking system. when it collapses again we have big problems.the government has created this bubble with Crazy schemes and a low interest rate money give Away. I suspect this is mostly desperate sub prime lending. There is nothing normal about current prices. The london Mega bubble is truly insane. How can this continue. who is buying? Who can buy anymore? Discussion at work yesterday about could prices rise any further, when I said London would pop soon and prices here wouldn`t be going anywhere fast no one disagreed. Edited April 10, 2015 by dances with sheeple Quote Link to comment Share on other sites More sharing options...
dances with sheeple Posted April 10, 2015 Share Posted April 10, 2015 You're all so negative. Seems to me we are at the end of the boom and everyone knows it. Crash might take two years to play out but it's so obviously on the cards. I personally am looking forward to two years of commuting to work reading how much I've 'made' in property each month by not owning. I agree, it really is time to just chill, keep earning and watch the show. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted April 10, 2015 Author Share Posted April 10, 2015 I agree, it really is time to just chill, keep earning and watch the show. We;ve been watching the show for 7 or 8 years now, they wont stop till it collapses. Maybe we are at the point of collapse but looking round me at the moment it seems some people are going all in. Quote Link to comment Share on other sites More sharing options...
winkie Posted April 10, 2015 Share Posted April 10, 2015 Quote Link to comment Share on other sites More sharing options...
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