apom Posted January 10, 2006 Share Posted January 10, 2006 (edited) This graph is superb, it shows affordability and rises and falls Wages against Houseprices. http://www.housepricecrash.co.uk/forum/ind...pe=post&id=2273 (I stole this from another post.. I did not find it myself) we also need A graph to show homes per head of capita over the last fifty years. anyone any other ideas for graphs? Can this be ideas only..? We need ammo.. Statistics that are not manipulated for our point of view and quite clearly show the truth.. It is out there Edited January 10, 2006 by apom Quote Link to comment Share on other sites More sharing options...
bandylegs Posted January 10, 2006 Share Posted January 10, 2006 Total interest paid against interest rates. I have a theory that although the rate of interest is historically low the amount of interest actually being paid is historically high; can't find the stats to do it though. Quote Link to comment Share on other sites More sharing options...
apom Posted January 10, 2006 Author Share Posted January 10, 2006 Yes Master Yoda! Okay... I am fairly sure that there are more homes to people then there ever have been... that woould be useful. Send it to the BBC "Next time you say the housing shortage is getting worse.. we know you are lying.." attached to it. Quote Link to comment Share on other sites More sharing options...
Realistbear Posted January 10, 2006 Share Posted January 10, 2006 The graph shows a double top--correct me if I am wrong but doesn't this presage a crash of devastating proportions? A momentum rally that falters? Quote Link to comment Share on other sites More sharing options...
Goat Posted January 10, 2006 Share Posted January 10, 2006 How about a graph showing the level of gearing in the uk property market as a whole, ie the ratio of housing debt to housing equity. Quote Link to comment Share on other sites More sharing options...
BandWagon Posted January 10, 2006 Share Posted January 10, 2006 I like this one... Quote Link to comment Share on other sites More sharing options...
Guest Riser Posted January 10, 2006 Share Posted January 10, 2006 I like this one... I also like that chart as it shows that recession and falling house prices go hand in hand. I suspect a poll of the general public would show many more prepared to accept the concept of a recession in the next few years than those prepared to accept that house prices could fall 20-40%. For recession read House Price Crash. Quote Link to comment Share on other sites More sharing options...
frugalista Posted January 10, 2006 Share Posted January 10, 2006 I like this one... That is a fantastic graph BandWagon. How many times have we heard "there won't be a crash until there is a recession"? Pretty clear to me that the causal relationship is the other way round... frugalista Quote Link to comment Share on other sites More sharing options...
frugalista Posted January 10, 2006 Share Posted January 10, 2006 (edited) The graph shows a double top--correct me if I am wrong but doesn't this presage a crash of devastating proportions? A momentum rally that falters? Is this trader-lore? Are you saying a single top would have indicated a smaller crash? I am making this up as I go along, but perhaps the double top is a particularly bearish sign because of the following chain of events: 1 - massive speculation builds up, drawing almost everyone in. 2 - due to price rises speculative belief fails in the vanguard section of "informed" asset holders, who offload their holdings. 3 - this causes the first peak to appear. 4 - however, such was the magnitude of speculative belief that the remaining less informed section of the market takes the small drop as a buy signal. 5 - this causes the second peak. 6 - finally a combination of the remaining speculative belief disappearing and fundamentals blowing out some people's cash flow situation causes a massive bear run. frugalista Edited January 10, 2006 by frugalista Quote Link to comment Share on other sites More sharing options...
oracle Posted January 10, 2006 Share Posted January 10, 2006 Is this trader-lore? Are you saying a single top would have indicated a smaller crash? I am making this up as I go along, but perhaps the double top is a particularly bearish sign because of the following chain of events: 1 - massive speculation builds up, drawing almost everyone in. 2 - due to price rises speculative belief fails in the vanguard section of "informed" asset holders, who offload their holdings. 3 - this causes the first peak to appear. 4 - however, such was the magnitude of speculative belief that the remaining less informed section of the market takes the small drop as a buy signal. 5 - this causes the second peak. 6 - finally a combination of the remaining speculative belief disappearing and fundamentals blowing out some people's cash flow situation causes a massive bear run. frugalista that's pretty much it,plus you need to add in the people shorting,effectively selling for whatever circumstance. the amount of muppets that are willing to pay top whack for an asset that yields less than a bank account is drying up fast...but the amount of sellers wanting to lock in profit is increasing. result= DOWN! Quote Link to comment Share on other sites More sharing options...
Freelance Mycophagist Posted January 10, 2006 Share Posted January 10, 2006 Is it just me, or is there more than a strong corellation between this and the 'you are here' graph? Or, is it entirely logical that there should be such a corellation? Do we have a statistics guru here who could analyse the two sets of data (please)? Quote Link to comment Share on other sites More sharing options...
frugalista Posted January 10, 2006 Share Posted January 10, 2006 Is it just me, or is there more than a strong corellation between this and the 'you are here' graph? Or, is it entirely logical that there should be such a corellation? Do we have a statistics guru here who could analyse the two sets of data (please)? It is entirely logical that the two graphs should be similar but not identical. The "you are here" graph is normalized by general price inflation (e.g. CPI), the other graph is effectively normalized by wage inflation. Since general inflation and wage inflation are closely correlated, the graphs are similar. frugalista Quote Link to comment Share on other sites More sharing options...
BandWagon Posted January 10, 2006 Share Posted January 10, 2006 (edited) It is entirely logical that the two graphs should be similar but not identical. The "you are here" graph is normalized by general price inflation (e.g. CPI), the other graph is effectively normalized by wage inflation. Since general inflation and wage inflation are closely correlated, the graphs are similar. frugalista Correct. Bear in mind that CPI is around 2%, while wage inflation is about 4%, so each year we do get materially wealthier. The wonders of capitalism. The graph on the front page of HPC is adjusted for consumer inflation, and according to this measure houses do show real (above inflation) growth, hence the exponential nature of the graph. Houses only go up, don't you know. The graph I have posted shows houses against wage inflation, and against this measure over long periods house prices remain constant (with some extreme short term fluctuations!) Edited January 10, 2006 by BandWagon Quote Link to comment Share on other sites More sharing options...
Jason Posted January 10, 2006 Share Posted January 10, 2006 I cannot see the chart/Can you dump it into: http://www.imageshack.us ? There you go Doc, it's just inflation adjusted house prices from Nationwide (I think): Quote Link to comment Share on other sites More sharing options...
Freelance Mycophagist Posted January 11, 2006 Share Posted January 11, 2006 It is entirely logical that the two graphs should be similar but not identical. The "you are here" graph is normalized by general price inflation (e.g. CPI), the other graph is effectively normalized by wage inflation. Since general inflation and wage inflation are closely correlated, the graphs are similar. frugalista This confirms my suspicions: I'm a bit dense... Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted January 11, 2006 Share Posted January 11, 2006 Yes Master Yoda! Don't you mean Master Yoda yes ? Quote Link to comment Share on other sites More sharing options...
apom Posted January 11, 2006 Author Share Posted January 11, 2006 Quality.. So we can track the previous crashes now.. Even those hidden by massive inflation as they were mostly before 1989's triumph. We can tie the recessions into economic events that follow house price crashes. Now, graphs to debunk myths.. The housing shortage is getting worse..? Well what we need there is a graph showing number of homes against population. If that proves our case further, if it shows different I would of course want it burried (Please bull's. the market has been boom bust boom since 1986 so don't say about how people are living in different social groups.. that is geared by the house market, not vice-versa...) any other graphs.. If these are simple graphs showing true statistics we can stop the BBC spin. Housing shortage getting worse..? is it Estate agent? sell a house then idiot.. Because we can show that there are more homes per head of capita then ever before.. any other ideas? Quote Link to comment Share on other sites More sharing options...
paradox Posted January 11, 2006 Share Posted January 11, 2006 I agree that the housing units per head of capita would be good. Of course, it will lump together flats with houses, but it would be a good indicator. My guess is that population has increased, but so has the number of units. Quote Link to comment Share on other sites More sharing options...
OzzMosiz Posted January 11, 2006 Share Posted January 11, 2006 Bear in mind that CPI is around 2%, while wage inflation is about 4%, so each year we do get materially wealthier. The wonders of capitalism. Was this typed with 'tongue in cheek'?? Quote Link to comment Share on other sites More sharing options...
Guest wrongmove Posted January 11, 2006 Share Posted January 11, 2006 So we can track the previous crashes now.. Below is a graph of nominal prices (no adjustment for wage or general inflation) I believe "newbies" should have access to this, as well as the adjusted data, as it shows that nominal prices actually rose during both the 70s "crashes". I agree that real prices are important, but just showing the one graph could look a little like VI spin...... Quote Link to comment Share on other sites More sharing options...
KickThemInThePant Posted January 11, 2006 Share Posted January 11, 2006 Is it just me, or is there more than a strong corellation between this and the 'you are here' graph? Or, is it entirely logical that there should be such a corellation? Do we have a statistics guru here who could analyse the two sets of data (please)? Glad that it was pinned. Yes, the graph I put together is based on figures from Nationwide which is the same source as the 'you are here' graph. Both use exactly the same data for average house price, although my graph simply divides this figure by average earnings during each quarter. Very simple, no frills and not open to manipulaton. To be honest the results were not what I wanted to see as I would like to buy my first house in the next year or two. However it looks like the crash has a long distance to travel before we reach anything like the average price to earnings ratio. Perhaps 3 - 4 years of continual falls before it reaches an end, even though it has already started. For a first time buyer to buy a house in then next year or two would be foolish in the extreme. Sorry for anyone else in my position but that's the simple truth. Quote Link to comment Share on other sites More sharing options...
apom Posted January 11, 2006 Author Share Posted January 11, 2006 Below is a graph of nominal prices (no adjustment for wage or general inflation) I believe "newbies" should have access to this, as well as the adjusted data, as it shows that nominal prices actually rose during both the 70s "crashes". I agree that real prices are important, but just showing the one graph could look a little like VI spin...... True, but the magic of the graph against average wages is that it measures inflation. Don't forget if you compare both graphs it shows housing booms. followed by massive periods of inflation. Damaging inflation. But inflation that showed house prices plummet against wages. which removed the danger of over borrowing from the home owners and infact made theri debt smaller. but if over stretched house prices cause the economic turmoil that we have always seen, but do so in a period where management of inflation is primary we see the actual house prices plummet without inflation. Don't forget, we are already seeing wage push inflation happening. But the MPC have stated that if pay rises outstrip 2.5% (I.e more then inflation is) we will see higher interest rates. pushing borrowing down without protecting those already in debt from their debt by allowing it to be inflated away in their salary increases. Infact the tool the MPC plan to use in this case is to increase IR's which reduces borrowing and makes it harder for those in debt. We have seen statements like this indicating that if inflation runs away the economy will be protected even if it means sacrificing those in massive debt. Inflation is not your friend, house price inflation was never your friend. Quote Link to comment Share on other sites More sharing options...
Guest wrongmove Posted January 11, 2006 Share Posted January 11, 2006 (edited) True, but the magic of the graph against average wages is that it measures inflation. Hi apom. Indeed it does. But say you had STR in the 70s ? Or put off buying as an FTB ? You would still have had to pay more cash to enter or re-enter the market later. I think real prices are very important to see longterm trends and buying opportunites. But for an FTB like me, it is nominal prices that I care about. My point is that both graphs are important, but the website only shows the one that most supports the crash argument - this could look like spin. Edited January 11, 2006 by wrongmove Quote Link to comment Share on other sites More sharing options...
assetpriceinflation Posted January 11, 2006 Share Posted January 11, 2006 My favourite from last year came from BayAreaBear and showed HousePrices over last thirty years priced in gold. I'd love to see a similar one showing Stock Market priced in gold Quote Link to comment Share on other sites More sharing options...
Guest wrongmove Posted January 11, 2006 Share Posted January 11, 2006 My favourite from last year came from BayAreaBear and showed HousePrices over last thirty years priced in gold. I'd love to see a similar one showing Stock Market priced in gold Yeah - be good to see one priced in orange juice futures too ! Quote Link to comment Share on other sites More sharing options...
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