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TheCountOfNowhere

Supply And Demand.....my Backside

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Came across this graph last week...I've thought about it and think it debunks the !suply and demand" myth.

Surely it represents a disasterous speculatory bubble ?

HTB.jpeg

This one graph has made me confident that the London mega bubble WILL fall at least 50%

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Came across this graph last week...I've thought about it and think it debunks the !suply and demand" myth.

Surely it represents a disasterous speculatory bubble ?

attachicon.gifHTB.jpeg

This one graph has made me confident that the London mega bubble WILL fall at least 50%

The rhs of that chart has a familiar look about it.

Wile_E_Coyote-Dont_Look_Down.jpg

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You might be right

But predicting accurately when a crash will start, how big it will be and how long it will last is simply not possible

Be prepared

And consider how you (not you specifically count, but you as in everyone) will feel, think and respond when it happens.

Would you be willing and able to 'buy when there is blood in the streets?'

Are you expecting to catch the bottom of the price curve? To buy on the way down in the knowledge that prices could go down (much further) from your purchase price? To buy on the way back up when the crash is clearly over?

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Came across this graph last week...I've thought about it and think it debunks the !suply and demand" myth.

Surely it represents a disasterous speculatory bubble ?

HTB.jpeg

This one graph has made me confident that the London mega bubble WILL fall at least 50%

It doesn't debunk the supply and demand argument at all.

HTB has simply fuelled demand.

The price of a house isn't determined by the demand for homes or the supply of houses, that much is true. It is determined by the demand for a speculative investment (a welfare cheque from the productive part of society) and the supply of economically useful residential land.

If we try to fix the problem by building houses, all we are really doing is building speculative investment vehicles, and that is ultimately a huge waste of time and resources.

Still, if it brings the cost of a house down, it is better than the current crisis.

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You might be right

But predicting accurately when a crash will start, how big it will be and how long it will last is simply not possible

Be prepared

And consider how you (not you specifically count, but you as in everyone) will feel, think and respond when it happens.

Would you be willing and able to 'buy when there is blood in the streets?'

Are you expecting to catch the bottom of the price curve? To buy on the way down in the knowledge that prices could go down (much further) from your purchase price? To buy on the way back up when the crash is clearly over?

People will buy when it is affordable for them. Volumes are low because landlords have bid up prices to stupidlevels.

This isn't about making money for me. Strange concept right! To buy a house to raise a family. I don't want to pick the bottom just sustainable debt, modest house at fair price.

Why is this difficult to understand?

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I'm not sure I entirely understand how that graph demonstrates there's a speculative bubble.

As prices go up, fewer people are moving up the ladder. Areas of the south east you're looking at an extra six figures on mortgage for an extra room, no thanks.

It does mean that prices are being set by the tiny number of places that are actually on sale.

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People will buy when it is affordable for them. Volumes are low because landlords have bid up prices to stupidlevels.

This isn't about making money for me. Strange concept right! To buy a house to raise a family. I don't want to pick the bottom just sustainable debt, modest house at fair price.

Why is this difficult to understand?

Some could afford to buy now but will not do so any more than they would pay £5 for a bag of crisps.

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Some could afford to buy now but will not do so any more than they would pay £5 for a bag of crisps.

I can afford to buy now, then some boomer can afford to have a nice retirement.

I can also afford to move to Spain, sit in the sun, have a stress free life and not work again.

Which would you choose ?

There is plenty supply and rapidly diminishing demand.

Edited by TheCountOfNowhere

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I can afford to buy now, then some boomer can afford to have a nice retirement.

I can also afford to move to Spain, sit in the sun, have a stress free life and not work again.

Which would you choose ?

There is plenty supply and rapidly diminishing demand.

Personally, I prefer not to buy now (which, like you, I could afford to do), I am waiting for value to return to the housing market, so I rent.

I like sitting in the sun, in Spain, but not in the summer (much too hot), so I rent an apartment, for pennies, in the off-season and enjoy temperatures in the low 20s.

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Came across this graph last week...I've thought about it and think it debunks the !suply and demand" myth.

Surely it represents a disasterous speculatory bubble ?

attachicon.gifHTB.jpeg

This one graph has made me confident that the London mega bubble WILL fall at least 50%

A 50% crash around here would still see an 80m2 period house in a good location costing the best part of £400k.

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A 50% crash around here would still see an 80m2 period house in a good location costing the best part of £400k.

Yeah, that's affordable to a lot of middle earners in London.

That;s much better than the top 10% of earners being able to afford a luxury apartment poxy flat

Edited by TheCountOfNowhere

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Yeah, that's affordable to a lot of middle earners in London.

That;s much better than the top 10% of earners being able to afford a luxury apartment poxy flat

That only takes us back to 2007 prices though which were already mental and wages have done bugger all since then.

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Its clearly a bubble inflated by speculation and money laundering, which will make the crash all the more spectacular. Of course 'no one will have foreseen it' and the banks will want yet another massive bailout and then demand that we destroy what's left of the productive economy and welfare to pay them back. This time it will most likely be the Tories who are on watch with no one other than themselves to blame.

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That only takes us back to 2007 prices though which were already mental and wages have done bugger all since then.

In London, yes, but an average (national) 50% correction could mean 60% or more in London.

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Personally, I prefer not to buy now (which, like you, I could afford to do), I am waiting for value to return to the housing market, so I rent.

I like sitting in the sun, in Spain, but not in the summer (much too hot), so I rent an apartment, for pennies, in the off-season and enjoy temperatures in the low 20s.

Looks like a smashing idea that, wintering in a nicer climate on the cheap.

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Looks like a smashing idea that, wintering in a nicer climate on the cheap.

I agree, now how do I convince my Wife that it will benefit us and our young Son, to escape the Winter each year.

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I agree, now how do I convince my Wife that it will benefit us and our young Son, to escape the Winter each year.

It works best when you're retired ;).

Now if I could convince my wife to ditch all our junk we wouldn't need to rent a house in the UK for 365 days a year, and only live in it for half that, I'd be quids in :lol:.

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It works best when you're retired ;).

Now if I could convince my wife to ditch all our junk we wouldn't need to rent a house in the UK for 365 days a year, and only live in it for half that, I'd be quids in :lol:.

Some retirees own a very high spec caravan on a 6 months only touring site for that purpose. The ground rent is effectively only for 6 months of the year since they don't have planning permission for full year round residential use.

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I think those with theories about that graph need to explain them. The most obvious interpretation is that tightly constrained supply has put prices up.

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It's n interesting graph OP particularly the bit with HTB2 but is it just me or do the figures not match those on the graph in the main page?

Different data set I believe ( LR versus Nationwide ).

No one should be under any illusions after looking at and understanding, that graph....the UK housing market is based on nothing other than speculation now.

When the speculating stops....so do the house prices !!!

#CaveatEmptor.

Edited by TheCountOfNowhere

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People will buy when it is affordable for them. Volumes are low because landlords have bid up prices to stupidlevels.

This isn't about making money for me. Strange concept right! To buy a house to raise a family. I don't want to pick the bottom just sustainable debt, modest house at fair price.

Why is this difficult to understand?

Definitely. Exactly that.

pipllman - not all of us are interested in property investing. You're (mostly) around people who just want to buy a home, on hpc. Take your investor head off imo.

Feel, think and respond? :lol:

My escape moment from Generation-Rent-Forever, in a HPC, buying a home at much better value than today's prices vs the BTLer minds.

118ers and PTers since the Budget in early July.

fuck-shit-damn.gif

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I think those with theories about that graph need to explain them. The most obvious interpretation is that tightly constrained supply has put prices up.

There's nothing to explain. Prices always peak a few months after transactions peak. It's the decline in demand which sets the trend and leads the market down.

The only thing that could reverse the trend would be a massive upswing in sales.

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