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apom

House Prices Are Not The Issue.

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Here is the key...

Will a struggle now become easier later..?

and comments :)

Guess what house prices did in 1997 with the MPC split and promissed to manage inflation as low as it could be?

name a generation who managed to pay their mortgages of faster then inflation did?

Would ours need to in a low inflation environment?

So with low managed inflation what is an IO mortgage?

Suicide?

a great plan, this inflation stuff is so very complicated?

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Okay here is a hint..

all bubbles pre 1989's would leave you in massive debt..

But that massive debt would be shortlived..

The massive wage inflation would save many and those that lost their jobs would blame the recession caused by the wage inflation and never actually connect the wage inflation with the fact that everyone needed more money becasue they had paid too much for their home and needed more to pay for it.. and others needing more just to buy anything..

1989 they didn't let massive wage inflatin happen

1: protecting the economy

2: protecting savings

3: leaving those in massive debt still holding their debt..

House prices are a matter of opinion, debt is real.

read Merv's other stuff..

That comment was more complicated then it first seems

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But that massive debt would be shortlived..

The massive wage inflation would save many and those that lost their jobs would blame the recession caused by the wage inflation and never actually connect the wage inflation with the fact that everyone needed more money becasue they had paid too much for their home and needed more to pay for it.. and others needing more just to buy anything..

Everyone here (probably) understand this.

But if I were to buy tomorrow having a secure job (albeit with the prospect of low annual wage rises) on a repayment mortgage where the payment was at an acceptable level for me, then my wage inflation isn't my biggest concern. My biggest concern is making sure I am comfortable with the repayment.

What you really mean is that it should be the biggest concern for a large number of people who have bought in the last few years. I think it is safe to assume that most people here would only buy a place where the repayment (and likely future repayments, depending on fixes etc.) are comfortable to them. It is an interesting dichotomy. We here understand the issues, but they are only really a peripheral concern, the masses do not understand the issue, but it should actually be a major concern for them.

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A housing 'ladder' is only a ladder with wage inflation...

wage inflation is the effect of rungs moving closer together as the years pass, as the debt appears to be less

Housing inflation is the effect of rungs moving up as years pass.

With both of these occuring at the same time, people can move up the ladder

housing inflation with low wage inflation has moved bottom rung too far up, people have believed in the housing ladder, but it hasnt existed for years

Recently the only way to move up the ladder has been to own multiple properties to pay off your own...

Edited by moosetea

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This thread is incredibly relevant. But what would be the impact of GB stepping forward & changing the inflation target? Instant HPI as sheep after sheep realised the impact.

But IMO GB wouldn't do that alone, he'd like to see another govt blink first so he could join a trend rather than start one.

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This thread is incredibly relevant. But what would be the impact of GB stepping forward & changing the inflation target? Instant HPI as sheep after sheep realised the impact.

But IMO GB wouldn't do that alone, he'd like to see another govt blink first so he could join a trend rather than start one.

Inflation only dmages the economy..

That can be seen by the recessions following on the wage inflation of proevious booms..

Housing crashes impact only a comparitive few and are soon forgotten..

do we forget?

well 1989 - 95 is not that long ago and apparently so.

The MPC have been shouting that wage inflation will not happen..

as has gordon..

Press don't pass it all on though

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apom

Inflation only damages the economy..

I've got a feeling that hidden inflation can do even more damage in the long run as it can skew the system far further than would otherwise be the case. Great depression, Japan et el are indicators of what uncontrolled money printing and debt creation can do.

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apom

Inflation only damages the economy..

I've got a feeling that hidden inflation can do even more damage in the long run as it can skew the system far further than would otherwise be the case. Great depression, Japan et el are indicators of what uncontrolled money printing and debt creation can do.

Don't forget though.. Wage inflation hits home..

As does reduced spending.

What do we remember the conservatives for…?

The poll tax and the welsh miners.. And Maggie

A generation later and we still remember the three day working week of the labour governments before..

Trust me, Wage inflation and a recession will be avoided at all costs..

Wage inflation will not protect us from imports of fuel..

And trust me, it will not help protect more of our jobs from going abroad..

Why do we need more salaries?

House prices, taxes and fuel to.. But mostly house prices.. And debt levels..

Why are houses so expensive?

Is the penny dropping?

We all know this..

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MPC don't control my wage increases.

I do, to some extent, by promotions.

Or starting my own company.

Or.....

Time to think outside the box Apom. There's no such thing as society. We're all individuals.

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Everyone here (probably) understand this.

But if I were to buy tomorrow having a secure job (albeit with the prospect of low annual wage rises) on a repayment mortgage where the payment was at an acceptable level for me, then my wage inflation isn't my biggest concern. My biggest concern is making sure I am comfortable with the repayment.

What you really mean is that it should be the biggest concern for a large number of people who have bought in the last few years. I think it is safe to assume that most people here would only buy a place where the repayment (and likely future repayments, depending on fixes etc.) are comfortable to them. It is an interesting dichotomy. We here understand the issues, but they are only really a peripheral concern, the masses do not understand the issue, but it should actually be a major concern for them.

Inflation has always had the same effect re-house prices.........In the short run IRs will rise and stall the market and hammer the cashflow of recent buyers.............but when the high IRs subside the newly-inflated wages drive the market higher.....This is why there were 3 booms in the 12 year period 1970-82..........The boom /bust cycle in property is much quicker in this situation..........

Low inflation and Low irs like we have now means more of the burden is transferred from the beginning of the mortgage to its later years......and the cycle is long and drawn out............

Edited by Michael

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MPC don't control my wage increases.

I do, to some extent, by promotions.

Or starting my own company.

Or.....

Time to think outside the box Apom. There's no such thing as society. We're all individuals.

Another ignorant post! :lol:

Yes of course individually we can all climb the corporate ladder and make sure our individual careers develop, but that is hardly the same thing as wage inflation.

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  • 302 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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