What a difference a year makes

[TheCountOfNowhere]

What a difference a year makes:

All the sheeple this time last year thought their luck would never end and forever HPI was here to stay.

 

Roll forward 12 months and we have

 

political turmoil,

the US raising rates,

The BOEs position on low IRs looking more and more insane with the district possibility they might have to follow the US.

BTL being hammered

the young waking up (at last )

Corbyn a potential PM

BrExit

Immigrants possibly gonig home

HTB2 ending.

Osborne and Cameron Leaving.

Hung parliament

The £ collapse

EVEN lower mortgage rates ( as if we didnt already suspect maintaining the housing bubble was the BoEs only plan ).

The MSM changing their narrative

Large falls in some parts of London.

MOM falls being indicated by the lenders

The realization that there is a bubble ( how did anyone miss that ).

12 months ago things looked pretty desperate for renters/HPCers, now, it's grand renting again and there's not much prospect if HPI any more.

The next 12 months will be a definitng moment in the 2007 collapse,

Sit back, buckle up and thank the lord you're not one of the BTL brigade who thought the recover from 2007 was the chance to go all in.

You can loose on Bricks and Mortar, people all round the world are about to realise this.

 

 

 

Edited June 15, 2017 by TheCountOfNowhere

[highcontrast]

Great summary, in fact great post full stop. An incredible turnaround. And losing on Bricks and Mortar!!???...who'd have thought it!? 

And yeah, the over-leveraged BTL parasites will be soiling themselves very very soon mwuhahaha 

 

[TheCountOfNowhere]

2 hours ago, fru-gal said:

I think the main thing is that sentiment is getting really ugly for HPI/rentiers and especially with the terrible Grenfell Tower tragedy, the spotlight is going to fall on housing even more.

+1.

Owning a property as a "business" makes you pretty much liable for any kind of disaster.

They lock such guilty people up for a long time.

Could be something the "the BTL is my pension" brigade haven't factored in.

Are you a business or a money grabbing cu*t ? 

 

[Roman Roady]

2 hours ago, deadlyavenger said:

...who'd have thought it!? 

 

Any one who went through the last HPC of the late eighties/early nineties thats who!

[Bear Hug]

3 minutes ago, fru-gal said:

David Lammy/Corbyn suggesting that the houses of the rich in Kensington be requisitioned for those that have been made homeless in the Grenfell Tower fire .

Presumably unoccupied investment properties? Why not then. They'll just have to launder their money elsewhere.

[thisisthisitmaybe]

I think this little ancient nation of ours is actually dictating world events once again (but from a position of weakness, not strength).

The Count's post shows how THE DOMINO EFFECT is now in play. During the last English Revolution (Cromwell and all that), people found they could no longer keep up with sweeping political, social and economic changes. 

This is how it feels now - that the news is accelerating, and we can no longer process all the information.

This means people are starting to LOSE THE PLOT, or even questioning, WHAT'S THE PLOT, and then simply pleading, MAKE UP A PLOT. 

People are fearful and getting tribal. They think there is safety in numbers.

I'm afraid the only guaranteed safety is to get the hell out. 

[Ballyk]

You forgot falling rents

[zugzwang]

6 hours ago, thisisthisitmaybe said:

I think this little ancient nation of ours is actually dictating world events once again (but from a position of weakness, not strength).

The Count's post shows how THE DOMINO EFFECT is now in play. During the last English Revolution (Cromwell and all that), people found they could no longer keep up with sweeping political, social and economic changes. 

This is how it feels now - that the news is accelerating, and we can no longer process all the information.

This means people are starting to LOSE THE PLOT, or even questioning, WHAT'S THE PLOT, and then simply pleading, MAKE UP A PLOT. 

People are fearful and getting tribal. They think there is safety in numbers.

I'm afraid the only guaranteed safety is to get the hell out. 

Milton Friedman and Margaret Thatcher's insane forty year free market dream is coming apart at the seams. 2008 was just the entree.

[Toast]

7 hours ago, thisisthisitmaybe said:

I think this little ancient nation of ours is actually dictating world events once again (but from a position of weakness, not strength).

The Count's post shows how THE DOMINO EFFECT is now in play. During the last English Revolution (Cromwell and all that), people found they could no longer keep up with sweeping political, social and economic changes. 

This is how it feels now - that the news is accelerating, and we can no longer process all the information.

This means people are starting to LOSE THE PLOT, or even questioning, WHAT'S THE PLOT, and then simply pleading, MAKE UP A PLOT. 

People are fearful and getting tribal. They think there is safety in numbers.

I'm afraid the only guaranteed safety is to get the hell out. 

This feels like a very insightful post.

Reading Sebastian Haffner's "Defying Hitler" (which is a first-hand account of the societal changes in Germany that led up to the second world war), there is a very worrying parallel, albeit not nearly so pronounced in the UK, to the inter-war years in Germany. That parallel is the loss of faith in the old and stable institutions of the country. For example, there is no obvious reason on the surface why the Kammergericht (the highest state court) should be able to defy an armed crowd, since it's just a building full of old men; however, in a society where the fabric of trust and respect is strong, those armed young men wouldn't stand a chance. Haffner describes, in one of the most haunting scenes in the book, how the humane and civilised structure of the court (where Jews and other German citizens worked on an entirely equal basis) simply fell apart when a few brownshirted thugs rolled up. In the past, you could have counted on the unified outrage of every citizen to thugs trying to march on the highest court, and nobody (not even an army) can stand up against a truly united population. However, once everybody loses faith in the impotance of an institution, and are only concerned about looking to their own survival and selfish interests, then we see how frail the underpinnings of civilisation really are.

In Germany of course, they had been through the hyperinflation of the Weimar years: but again, although that hyperinflation led to harrowing poverty and physical suffering for many (and riches for others), it seems that its most troubling effect was that it destroyed the faith of people in the existence of a society where you could work and contribute, and get back a decent standard of life in return. When you have many young men rolling in riches from gambling on the stock market, and 20 year old bank managers who have got there through that kind of financial recklessness; and at the same time, old folks regularly starving to death on the streets, and working men unable to feed their families, then people lose trust in the institutions and mechanisms of normal society. That shaking of the foundations of normality was what really laid the groundwork for the populism and violence that followed.

Now, the UK hasn't seen the same kind of hyperinflation that was witnessed in Germany. However, it has seen a hyperinflation in housing, which is eroding (I believe) the faith of at least one generation in the functioning of our country. If work doesn't pay, while selfish gambling, and leveraging a housing crisis for your own personal profit (provided you were lucky enough to be born at the right time and immoral enough to take advantage: the analogy to the wild youth of 20's Germany is almost too painful), then why would you support the institutions that have made this the norm? I fear that successive governments have been laying down thick, dry layers of tinder, ready for any demagogue to inflame.

[“Nasty Piece of work”]

This year has gone from Cameron arrogance, to Bungle pretending to be Boudicca.  What will we see this time next year?

[TheCountOfNowhere]

9 hours ago, thisisthisitmaybe said:

I think this little ancient nation of ours is actually dictating world events once again (but from a position of weakness, not strength).

The Count's post shows how THE DOMINO EFFECT is now in play. During the last English Revolution (Cromwell and all that), people found they could no longer keep up with sweeping political, social and economic changes. 

This is how it feels now - that the news is accelerating, and we can no longer process all the information.

This means people are starting to LOSE THE PLOT, or even questioning, WHAT'S THE PLOT, and then simply pleading, MAKE UP A PLOT. 

People are fearful and getting tribal. They think there is safety in numbers.

I'm afraid the only guaranteed safety is to get the hell out. 

It does feel a bit like that.

Why should I go to work and pay taxes for that money to be used to prop up/profit large building firms

Why should I go to work and pay taxes for that money to be used to prop up/profit large banks

Why should I go to work and pay taxes for that money to be used to prop up/profit speculators

Why should I go to work and pay taxes for that money to be used to prop up/profit BTLers

Why should I go to work and pay taxes for that money to be used to inflate house prices to insane levels, making money worthless.

Why should I go to work and pay taxes for that money to be used to prop up/profit no one end private companies doing public sector jobs

Why should I go to work and pay taxes for that money to to pay council staff 200K salaries

Why should I go to work and pay taxes for that money to be used to pay other peoples rents

Why should I go to work and pay taxes for that money to be used to pay other peoples mortgages

Why should I go to work and pay taxes for that money to be used to pay for foreigners who have never contributed a penny to the UK

Why should I go to work and pay taxes for that money to be used to pay for roads in Bulgaria

Why should I go to work and pay taxes for that money to be used to prop up EU banks.

Why should I go to work and pay taxes for that money to be used to allow terrorists to come into our county.

Why should I go to work and pay taxes for that money to be used to support the terrorists who came.

Why should I go to work and pay taxes for that money to be used to pay for healthcare for people who pay no taxes

Why should I go to work and pay taxes for that money to be used to pay for a government that will try and ignore a referendum

Why should I go to work and pay taxes for that money to be used to pay for......this list is too long to continue, but you get the idea.

Why should I go to work and pay taxes at the rate of 60%+ ( real and hidden taxes )

 

Working in the UK right now is pointless, what are you working for, to be robbed even more, so someone else can have a better life, for your savings to be eroded, for your spending power to be eroded ? Meanwhile, the bankers sit in clover, supported by freshly printed money and their central banker chums refuse to act to help the poor because their own children's education is more importnant that people being able to eat. 

It's sickening watching the UK crumble and every parasite in the world coming here because the "British" government 

This is one sick country and this will inevitably lead to disaster of some kind.

Your post is spot on, get the hell out.

Edited June 16, 2017 by TheCountOfNowhere

[TheCountOfNowhere]

16 minutes ago, Mine the wheatfield said:

This year has gone from Cameron arrogance, to Bungle pretending to be Boudicca.  What will we see this time next year?

Protests.

Soldiers on the streets.

Sadly, this is closer than ever.

I blame Osborne/Cameron, they had the chance in 2010 to actually stabalise things, but we all know what they did that summer.

[Blod]

23 minutes ago, buckers said:

Quite, that little 'bump in the road' seems to have been written out of the history books.

It was Gordon Brown who stated he put an end to 'boom and bust'. In doing so he created an atmosphere in the political classes that avoiding busts was their main priority whilst at the same time enforcing the notion in the public that there would no longer be busts. Booms were celebrated and stoked up without the fear of the busts of the past. 

He gave birth to 'privatise profits, socialise losses'.

[TheCountOfNowhere]

2 minutes ago, Blod said:

It was Gordon Brown who stated he put an end to 'boom and bust'. In doing so he created an atmosphere in the political classes that avoiding busts was their main priority whilst at the same time enforcing the notion in the public that there would no longer be busts. Booms were celebrated and stoked up without the fear of the busts of the past. 

He gave birth to 'privatise profits, socialise losses'.

The 2007 MEGA BUST must have come as a bit of surprise to him. 

What an arrogant c**t of a man he must be.

Edited June 16, 2017 by TheCountOfNowhere

[VeryMeanReversion]

25 minutes ago, TheCountOfNowhere said:

Why should I go to work and pay taxes for that money to be used to pay for......this list is too long to continue, but you get the idea.

Why should I go to work and pay taxes at the rate of 60%+ ( real and hidden taxes )

Working in the UK right now is pointless, what are you working for, to be robbed even more, so someone else can have a better life, for your savings to be eroded, for your spending power to be eroded ?

Its a lovely day, the sun is shining.

Working in the UK means you can avoid the high marginal rates by using a SIPP.  I got my employer to introduce salary sacrifice that makes this even more efficient. HMRC approved share schemes are available at  <10% marginal tax rates.

My UK savings aren't being eroded, they are invested, returning 3-4% divis tax-free. Capital is at risk but I'm up 30-40% so far.

If you don't use pensions to avoid PAYE, leave savings in cash then I agree, you are stuffed.

If you use the income to pay a large mortgage, you are stuffed.

If you "need" the income to pay for lots of consumer tat or maintain an expensive lifestyle, you are stuffed.

 

For me, it's all about the marginal rate.  At 30-35%, I don't really mind.  At 40+%, I reduce income and/or make every effort to make use of legal schemes to avoid the tax.

 

[TheCountOfNowhere]

11 minutes ago, VeryMeanReversion said:

Its a lovely day, the sun is shining.

Working in the UK means you can avoid the high marginal rates by using a SIPP.  I got my employer to introduce salary sacrifice that makes this even more efficient. HMRC approved share schemes are available at  <10% marginal tax rates.

My UK savings aren't being eroded, they are invested, returning 3-4% divis tax-free. Capital is at risk but I'm up 30-40% so far.

If you don't use pensions to avoid PAYE, leave savings in cash then I agree, you are stuffed.

If you use the income to pay a large mortgage, you are stuffed.

If you "need" the income to pay for lots of consumer tat or maintain an expensive lifestyle, you are stuffed.

 

For me, it's all about the marginal rate.  At 30-35%, I don't really mind.  At 40+%, I reduce income and/or make every effort to make use of legal schemes to avoid the tax.

 

It amazes me with all that has gone on since 2000 that people think they'll get their pension.

IT'S A PYRAMIAD SCAM

There, now you know.

Good luck.

[Tempus]

11 hours ago, Bear Hug said:

Presumably unoccupied investment properties? Why not then. They'll just have to launder their money elsewhere.

Yes, the press talk about "homes of the rich" in the headlines to get a reaction when they should have talked about "empty flats bought as investments by foreign money launderers". 

[TheCountOfNowhere]

10 hours ago, Ballyk said:

You forgot falling rents

I forgot failing house prices too !!!          

[sisyphal]

1 hour ago, VeryMeanReversion said:

Working in the UK means you can avoid the high marginal rates by using a SIPP.  I got my employer to introduce salary sacrifice that makes this even more efficient. HMRC approved share schemes are available at  <10% marginal tax rates.

My UK savings aren't being eroded, they are invested, returning 3-4% divis tax-free. Capital is at risk but I'm up 30-40% so far.

If you don't use pensions to avoid PAYE, leave savings in cash then I agree, you are stuffed.

If you use the income to pay a large mortgage, you are stuffed.

If you "need" the income to pay for lots of consumer tat or maintain an expensive lifestyle, you are stuffed.

For me, it's all about the marginal rate.  At 30-35%, I don't really mind.  At 40+%, I reduce income and/or make every effort to make use of legal schemes to avoid the tax.

Your approach is very similar to mine, I'm winging it a bit though.  Seems like you've got it thought through better than me ... something which I need to correct.

I salary sacrifice everything above higher rate tax into a company pension scheme (and a SIPP). 

The next £4K goes into a LISA.  Then I live off the rest, I've a small mortgage (< 3x my salary).  I live very frugally, and if there's any left I overpay the mortgage.

Hard to do sometimes when I see others flying off on foreign holidays, buying bigger houses, driving nice cars etc.   When all I really get to see for my efforts for now is an increasing net worth every month (tracked in Excel). 

However it's the way I've chosen to navigate this inexplicable economic situation.  I'll stick to the plan for the next few years see where things stand then, and if I can keep on doing it.

[VeryMeanReversion]

1 hour ago, TheCountOfNowhere said:

It amazes me with all that has gone on since 2000 that people think they'll get their pension.

 

With an unfunded scheme, I can agree.

With a defined benefit scheme, I can agree.

With a state pension, I can agree.

However, my pension is mostly cash and individual company shares held with within a SIPP.  No fund managers, no assets held by the platform provider, no "with-profits" style promises to other customers to use against me.  Its just about as reliable and under my control as any investment can get with minimum counterparty risk.

The pension rules can of course be changed (confiscation/reductions/PCLS-removal) but it looks to be as reliable as NS&I. Nothing's perfect.

I'll use drawdown to get the money out (annuities risky due to the counterparty going under, will leave that until life expectancy is <10 years).

So I should be one of the last to get screwed if it comes to it.  Once they start confiscating directly owned shares and cash from accounts, its game over for all of us anyway.  If it comes to it, I'll have a rentable outbuilding by then.  I suppose they could take that too, but that is too many "what-ifs" for my little brain today.

[TheCountOfNowhere]

4 minutes ago, VeryMeanReversion said:

 

With an unfunded scheme, I can agree.

With a defined benefit scheme, I can agree.

With a state pension, I can agree.

However, my pension is mostly cash and individual company shares held with within a SIPP.  No fund managers, no assets held by the platform provider, no "with-profits" style promises to other customers to use against me.  Its just about as reliable and under my control as any investment can get with minimum counterparty risk.

The pension rules can of course be changed (confiscation/reductions/PCLS-removal) but it looks to be as reliable as NS&I. Nothing's perfect.

I'll use drawdown to get the money out (annuities risky due to the counterparty going under, will leave that until life expectancy is <10 years).

So I should be one of the last to get screwed if it comes to it.  Once they start confiscating directly owned shares and cash from accounts, its game over for all of us anyway.  If it comes to it, I'll have a rentable outbuilding by then.  I suppose they could take that too, but that is too many "what-ifs" for my little brain today.

Fair does, a sensible approach, the only approach.

We are getting to the point where people will be FORCED to pay into a private pension.

This will be privatized taxation !!!

We are half way along this road already with the new auto pension enrollment thing.

When they force you to pay in abother 20%, ontop of the 40-70% tax you already pay for the privilege of living in the UK then it's time to GTFO.

 

[Locke]

4 hours ago, Toast said:

This feels like a very insightful post.

Reading Sebastian Haffner's "Defying Hitler" (which is a first-hand account of the societal changes in Germany that led up to the second world war), there is a very worrying parallel, albeit not nearly so pronounced in the UK, to the inter-war years in Germany. That parallel is the loss of faith in the old and stable institutions of the country. For example, there is no obvious reason on the surface why the Kammergericht (the highest state court) should be able to defy an armed crowd, since it's just a building full of old men; however, in a society where the fabric of trust and respect is strong, those armed young men wouldn't stand a chance. Haffner describes, in one of the most haunting scenes in the book, how the humane and civilised structure of the court (where Jews and other German citizens worked on an entirely equal basis) simply fell apart when a few brownshirted thugs rolled up. In the past, you could have counted on the unified outrage of every citizen to thugs trying to march on the highest court, and nobody (not even an army) can stand up against a truly united population. However, once everybody loses faith in the impotance of an institution, and are only concerned about looking to their own survival and selfish interests, then we see how frail the underpinnings of civilisation really are.

In Germany of course, they had been through the hyperinflation of the Weimar years: but again, although that hyperinflation led to harrowing poverty and physical suffering for many (and riches for others), it seems that its most troubling effect was that it destroyed the faith of people in the existence of a society where you could work and contribute, and get back a decent standard of life in return. When you have many young men rolling in riches from gambling on the stock market, and 20 year old bank managers who have got there through that kind of financial recklessness; and at the same time, old folks regularly starving to death on the streets, and working men unable to feed their families, then people lose trust in the institutions and mechanisms of normal society. That shaking of the foundations of normality was what really laid the groundwork for the populism and violence that followed.

Now, the UK hasn't seen the same kind of hyperinflation that was witnessed in Germany. However, it has seen a hyperinflation in housing, which is eroding (I believe) the faith of at least one generation in the functioning of our country. If work doesn't pay, while selfish gambling, and leveraging a housing crisis for your own personal profit (provided you were lucky enough to be born at the right time and immoral enough to take advantage: the analogy to the wild youth of 20's Germany is almost too painful), then why would you support the institutions that have made this the norm? I fear that successive governments have been laying down thick, dry layers of tinder, ready for any demagogue to inflame.

Respect is earned. Those old wankers in the courts have abused the citizenry so much for so long, that they no longer can expect to be spared the rope.

[Locke]

6 hours ago, zugzwang said:

Milton Friedman and Margaret Thatcher's insane forty year free market dream is coming apart at the seams. 2008 was just the entree.

The root of all this is government power. Anyone who denies this is ignorant or evil.

[ubuntu]

47 minutes ago, Locke said:

The root of all this is government power. Anyone who denies this is ignorant or evil.

yes so the solution will be even more government

[reddog]

14 hours ago, fru-gal said:

David Lammy/Corbyn suggesting that the houses of the rich in Kensington be requisitioned for those that have been made homeless in the Grenfell Tower fire .

I started a thread a few days ago, saying how an expensive house could be a liability if Corbyn was PM.

 

Obviously he isn't in power, but he seems to be trying very hard to destabilise the country, in order to have another election.

 

Surely the fact that someone who seems happy to tear up property rights can get anywhere near power should be very bearish for the economy in general, and for house prices specifically.