Jump to content
House Price Crash Forum

Recommended Posts

Well I'm quite surprised there, I pretty much agree with a Guardian journalist. 

One thing he failed to acknowledge was step 5, the boosting of wages. This isn't happening due to companies being under no financial pressure because employees are being subsided by the government through working tax credits and encouraged to work minimum hours.

It will cause a poverty crisis like never before in amongst 40-50 year olds with children no longer eligible in time to come.

Share this post


Link to post
Share on other sites
Quote

Step four is for the Bank of England to adopt a kid-glove approach to raising interest rates. The idea is to engineer a gradual fall in real – inflation-adjusted – house prices, not a recession that leads to a sharp increase in unemployment.

So many who position that house prices falling sharply means recession and unemployment; everything hostage to high house prices.

People who own houses matter, and renters not worth a damn.  All those owners who own outright, or have high levels of equity, must be protected eh.  Including my landlord with 5 houses.  

Lower house prices are better.   Get money into productive businesses.

Bubble zirpy jobs/companies need to go anyway, and not be protected.  Property-Meets/BTL Guest Speakers.

Quote

Neverwhere: There is no reason why a reduction in house prices has to involve a recession or loss of jobs, (a general reduction in housing costs should in fact free up more money for the productive economy), no one has stated a wish that a recession and loss of jobs happen just so that a HPC can take place

 

A few comments from article:

Quote

 

-this same article, every month.....for the last 7-8 years, zzzzzzzzzzzzzzz

-Mr. Carney needs to consider seriously the many negative effects of ultra low rates, misallocation of capital in equity markets for one; destruction of thrift among modest-low income individuals for another. In other words, Mr. Carney needs to consider that a country's economic sustainability depends on more than house price inflation and mortgage borrowers.

-Constantly talking up the risk of an increase in the rate yet never actually delivering one.  The problem with crying wolf is that sooner or later you will get eaten. 

 

 

Share this post


Link to post
Share on other sites
4 hours ago, Noallegiance said:

Usual self serving VI nonsense, desperate to stop a collapse in prices.

 

"Step four is for the Bank of England to adopt a kid-glove approach to raising interest rates. The idea is to engineer a gradual fall in real – inflation-adjusted – house prices, not a recession that leads to a sharp increase in unemployment."

 

Step 1.  Arrest the bankers.  Arrest Osborne.  Arrest Brown.

Step 2. Let prices collapse.

Step 3. Arrest fraudsters who are found not to be able to pay the debt they took out.

Step 4. Public hangings

Step 5. Regulate the remnants of the banking system.

 

 

 

Share this post


Link to post
Share on other sites
Quote

Economic theory suggests that homeowners would be encouraged to put their homes on the market when prices are rising, and that potential buyers would lose interest until prices start to fall.

This is not what tends to happen. Homeowners hold on to their homes because they assume that their property will continue to go up in price. Nor do rising prices dampen demand. Rather, people think they had better scramble on to the ladder before it is too late.

True until it isn't.  For five decades people have been 'investing' in larger and larger homes, way beyond their needs. But as boomers  inevitably become forced sellers we're going to see a tidal wave of capacity come onto the market. 

Share this post


Link to post
Share on other sites
1 hour ago, PropertyMania said:

True until it isn't.  For five decades people have been 'investing' in larger and larger homes, way beyond their needs. But as boomers  inevitably become forced sellers we're going to see a tidal wave of capacity come onto the market. 

Yes -The sense of mania and panic..."need to buy before prices extend further out of reach" etc is absolutely essential to the current market dynamic.  Everyone knows prices are horribly high but many buy regardless...why would you buy when you know you are getting very poor value?  A - Only when you are confident prices will continue to increase further, of course this is sustainable and when prices stabilise and start to correct many will be left holding tulips and wondering why they ever thought a tulip was worth so much.

Share this post


Link to post
Share on other sites

They've had a decade since the crisis hit to engineer a soft landing.

There has been no wage inflation to speak of in that time, and government policies have ensured house prices kept going to the stratosphere.

It's far far too late for that.  How many decades do buyers have left to wait?

Share this post


Link to post
Share on other sites
13 minutes ago, Wayward said:

Yes -The sense of mania and panic..."need to buy before prices extend further out of reach" etc is absolutely essential to the current market dynamic.  Everyone knows prices are horribly high but many buy regardless...why would you buy when you know you are getting very poor value?  A - Only when you are confident prices will continue to increase further, of course this is sustainable and when prices stabilise and start to correct many will be left holding tulips and wondering why they ever thought a tulip was worth so much.

BOOM. Any market ever in history whose sole remaining reason for going up is "because it's going up" is bubble top territory. 

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 293 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.