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TheCountOfNowhere

Bank of England finally admit their role in the broken housing market

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3 hours ago, TheCountOfNowhere said:

The men with all the facts disagree. 

 

You just can't afford one of the surplus house 😂😂😂

You agree with the BOE now?  Usually you are lampooning them as clueless morons..

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8 minutes ago, Si1 said:

Ooooh:

"Dame Colette Bowe, an incoming member of the Bank’s financial policy committee, calls housing “a social issue” and has questioned whether the commitee is getting its approach wrong. The Bank’s new analysis may be a good place for her to start."

Not many people would disagree that prices are silly... I've heard people myself saying it...but they seem to think it's normal and prices will continue up. 

 

History and arithmetic say otherwise. 

 

Buying, renting doesn't matter. Housing is dead money now either way. Trade off insecurity for capital protection, landlord maintenance for DIY. 

 

The choice is yours. The golden age of free money from housing is well and truly over, anyone joining in now will screw themselves for life. 

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1 hour ago, winkie said:

Plenty of excess housing/empty furnished housing.....not available for sale.;)

Yes...that's why I said supply 

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7 minutes ago, Si1 said:

There is a further point to be made that the parasite doesn't want to kill the host, in the long run.

Unless a generation of parasites knows it will retire soon (because of age or because of the fact that they have enough wealth accumulated).

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Just now, Wayward said:

You agree with the BOE now?  Usually you are lampooning them as clueless morons..

Ahhh, an old follower. 18 months with 5 posts and still people remember the count, thanks. 

 

Never clueless morons, evil sadistic liars perhaps. Contrarians definitely. Theyve used chatter to keep things going for sure. 

 

You have to read through their press release to what the real message is. 

 

Why would the boe admit they are wrong? They'll be outed as heros when they fix the mess. Identified the problem they did and fixed it 

One can but hope. 

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Just now, TheCountOfNowhere said:

Ahhh, an old follower. 18 months with 5 posts and still people remember the count, thanks. 

 

Never clueless morons, evil sadistic liars perhaps. Contrarians definitely. Theyve used chatter to keep things going for sure. 

 

You have to read through their press release to what the real message is. 

 

Why would the boe admit they are wrong? They'll be outed as heros when they fix the mess. Identified the problem they did and fixed it 

One can but hope. 

Of course I remember the Count...!

I will have a read through their report.

My view which I have posted many times is that you need both easy credit and conditions of scarcity /competitive bidding for housing for HPI...

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2 hours ago, LetsBuild said:

Yes it does make me feel vindicated, i have had the odd argument where I have tried to explain that it is the supply of credit and not the supply of houses that has been setting the price of housing. Problem is people are so brain washed that even a full blown apology on the telly by the men in suits will not reset that belief.

Yes, but don't forget there are two types of credit.

1. where the issuer risks a direct loss to depositors.....there are limits

2 where the issuer risks no direct loss to depositors..... there are no limits....(where 'money' is created from eff all).

??

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4 minutes ago, Burbujista said:

Unless a generation of parasites knows it will retire soon (because of age or because of the fact that they have enough wealth accumulated).

But retire they will.

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4 minutes ago, TheCountOfNowhere said:

Ahhh, an old follower. 18 months with 5 posts and still people remember the count, thanks. 

 

Never clueless morons, evil sadistic liars perhaps. Contrarians definitely. Theyve used chatter to keep things going for sure. 

 

You have to read through their press release to what the real message is. 

 

Why would the boe admit they are wrong? They'll be outed as heros when they fix the mess. Identified the problem they did and fixed it 

One can but hope. 

What is the “solution” that will make them “heroes” in your opinion? (The quotation marks are not against you)

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2 minutes ago, TheCountOfNowhere said:

Ahhh, an old follower. 18 months with 5 posts and still people remember the count, thanks. 

 

Never clueless morons, evil sadistic liars perhaps. Contrarians definitely. Theyve used chatter to keep things going for sure. 

 

You have to read through their press release to what the real message is. 

 

Why would the boe admit they are wrong? They'll be outed as heros when they fix the mess. Identified the problem they did and fixed it 

One can but hope. 

I can't see any evidence of interest rates rising soon, nor even in the medium term (5-10 years?). All central banks seem to be battening down the hatches for a recession. Furthermore, I see no evidence that the BoE has any clue about where we are heading, excepting preparing in the short term for the underperformance of World economies, perhaps with increasing trade tensions. They are not going to rush to raise interest rates.

Nobody predicted such low interest rates Worldwide, and certainly not for this long. Nobody really knows where we are heading in such an unprecedented situation.

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2 minutes ago, Burbujista said:

What is the “solution” that will make them “heroes” in your opinion? (The quotation marks are not against you)

Affordable house prices... I'd guess at great cost to BTLers 

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3 minutes ago, cnick said:

Yes, but don't forget there are two types of credit.

1. where the issuer risks a direct loss to depositors.....there are limits

2 where the issuer risks no direct loss to depositors..... there are no limits....(where 'money' is created from eff all).

??

If the asset disappears on case 2 because the borrower defaults... how is it that it doesn’t affect depositors? If something... I think it’s the other way around. When the money comes from own funds (deposits, bonds or equity) the depositors are well protected. When all is printed out of thin air... even the depositors are taking huge amounts of risk.

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4 minutes ago, onlooker said:

I can't see any evidence of interest rates rising soon, nor even in the medium term (5-10 years?). All central banks seem to be battening down the hatches for a recession. Furthermore, I see no evidence that the BoE has any clue about where we are heading, excepting preparing in the short term for the underperformance of World economies, perhaps with increasing trade tensions. They are not going to rush to raise interest rates.

Nobody predicted such low interest rates Worldwide, and certainly not for this long. Nobody really knows where we are heading in such an unprecedented situation.

 

It's not unprecedented.  Its very much precedented.

US rates.

 

We will never know, but if we'd voted remain UK rates might now be 3%

 

Brexit, or qe, or something could collapse the £... You could be seeing 10% in weeks 

 

No one knows what's round the corner but it does fell like we are finally in the end game. 

Edited by TheCountOfNowhere

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Just now, TheCountOfNowhere said:

 

It's not unprecedented.  Its very much precedented.

US rates.

 

We will never know, but if we'd voted remain UK rates might now be 3%

 

 

Precedented? When were UK and US rates so low, and for so long?

Why would rates be so high as 3%? You presume that if the UK remained in the EU, the £ would be trading much higher against the Euro and $, and the effect of that on the UK economy would be the same as an interest rate rise. It would be a double whammy which would kill UK producers and exporters.

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9 minutes ago, onlooker said:

Precedented? When were UK and US rates so low, and for so long?

Why would rates be so high as 3%? You presume that if the UK remained in the EU, the £ would be trading much higher against the Euro and $, and the effect of that on the UK economy would be the same as an interest rate rise. It would be a double whammy which would kill UK producers and exporters.

US rates... 2.5%

 

Uk rates normally higher. 

 

I had it on good authority people in the city were expecting rates to go up 2 years ago now. Brexit must have scuppered that. Now a recession is looming the bankers have no where to go. 

 

Mortgage rates were higher for a long time even with interest rates at 0.5%

 

They can easily control this and they can control lending. 

 

We are peak lunacy now I'd be getting ready for a return to normal now.... In fact... I am. 

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1 hour ago, Si1 said:

only 18 months? I'd say 18 months at the bottom end, 18 years at the top end of expectations.....

I think the financial and electoral demographic chickens will come home to roost in the 2020s, by 2030 it will all be over. Agree with your point that a lot of damage has already been done though over the last 15-20 years. There is a large cohort who have already had to make major life compromises due to the high cost of housing (dual full time income instead of cutting back on work to raise families, having fewer or no children, longer commutes etc) and that cannot be magicked away.

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15 minutes ago, Burbujista said:

What about OO?

OO will be fine. 

MO... Mortgage owners... Most of the non btl stuff will be HTB so they could become financial zombies. 

Outside of that... Anyone in the middle loses what they gained. 

A few others will lose out big time but the over levered BTLers will be ####ed, no one will care tho, many will rejoice. 

 

Few people profit in any investment scheme. 

 

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4 hours ago, TheCountOfNowhere said:

https://www.thetimes.co.uk/article/bank-of-england-finally-admit-their-role-in-the-broken-housing-market-s0sbxqjh3

“We find that the rise in real house prices since 2000 can be explained almost entirely by lower interest rates,” the authors write. “Increasing scarcity of housing has played a negligible role.”

 

Anyone feeling vindicated? 

The question is.... What next. 

Prices are extreme is many parts of the country. 

Carney is leaving. 

 

Thinking of buying?  Might as well give it 18 months now. 

What if near zero rates are the new normal? 

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1 hour ago, Wayward said:

Of course I remember the Count...!

I will have a read through their report.

My view which I have posted many times is that you need both easy credit and conditions of scarcity /competitive bidding for housing for HPI...

Much of that scarcity is self generated. Most people I work with would rather stretch themselves to live in a 2 bed flat in zone 2 than a detached house in zone 5, even when though the time taken to get to work is similar.

Even in parts of the North West with plenty of surplus houses the desire to leave near "people like us" creates hot spots with near London prices.    

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6 minutes ago, Confusion of VIs said:

What if near zero rates are the new normal? 

Surprised people hadn't thought of it before. 

Id be happy with 0% interest if inflation was 0% or lower. 

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4 hours ago, stop_the_craziness said:

There is excess supply in my area if you want to buy a 4/5/6 bedroomed house for an absolute fortune so someone can cash in their lottery-of-life birth date win.

But no excess supply if you want to buy a normal house.

Sounds like near me

Definitely has slowed down another level and prices falling in the main.  There are few price reductions .... but even less interest so its very slow.

the party just needs some motivated sellers and its game on. 

Edited by Fromage Frais

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46 minutes ago, TheCountOfNowhere said:

US rates... 2.5%

 

Uk rates normally higher. 

 

I had it on good authority people in the city were expecting rates to go up 2 years ago now. Brexit must have scuppered that. Now a recession is looming the bankers have no where to go. 

 

Mortgage rates were higher for a long time even with interest rates at 0.5%

 

They can easily control this and they can control lending. 

 

We are peak lunacy now I'd be getting ready for a return to normal now.... In fact... I am. 

US rates now down to 2.25% and probably going lower. I have come to the view that most of the recent recessions have been caused by the Fed being too aggressive in raising rates and too slow to drop them. Trump seems to agree with me, but his control on Fed policy is constrained by law.

I know of know consistent argument why UK rates should always be higher than US.  I doubt the City really knows where rates are going, and why.

 

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6 minutes ago, onlooker said:

US rates now down to 2.25% and probably going lower. I have come to the view that most of the recent recessions have been caused by the Fed being too aggressive in raising rates and too slow to drop them. Trump seems to agree with me, but his control on Fed policy is constrained by law.

I know of know consistent argument why UK rates should always be higher than US.  I doubt the City really knows where rates are going, and why.

 

One look at a graph of the £ $ exchange rate should sort that for you.

Trumps policy is to spend lots of borrowed money and let the next guy worry about how it gets paid back. It is already clear that the hope that the boost to the economy would result in a drop in borrowing has not materialised and now he needs near 0% interest rates to stop his chickens coming home to roost.       

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1 hour ago, Fromage Frais said:

Sounds like near me

Definitely has slowed down another level and prices falling in the main.  There are few price reductions .... but even less interest so its very slow.

the party just needs some motivated sellers and its game on. 

Slow.... Is the right word. 

 

Painfully so. 

 

Still, no point trying to catch a falling knife even if in slow motion 

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  • 277 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%



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