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Property Industry Eye: The Thing is With Property Bubbles, They Burst


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Posted on an estate agent industry website.

https://propertyindustryeye.com/opinion-the-thing-with-property-bubbles-is-that-they-burst/

TL;DR - the UK has had property bubbles, booms and busts before. The Stamp Duty cut has created a boom for sure, but there are few signs of a bubble popping at present. Inflation, especially wage inflation could be on the cards though. If that leads to higher interest rates, the bubble will burst. Please Bank of England, see through any inflation instead.

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this is the million dollar question - will the inflation set in (like the 60s not the 70s) or is it transient?

there are good economists on either side of the debate of this

it's likely the central banks will hold off as long as they can though which might make things worse in the medium term IF inflation ends up proving a problem. If that happens it will wreck house prices. So it's very difficult deciding if it's worth buying in any immediate post covid dip as it might be a prelude to a much bigger long term slide

horrible

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I don't think it matters if inflation is transitory or permanent. Nothing short of alien invasion or nuclear apocalypse would cause them to increase interest rates above 1%. It's game over if they do and they know it. They'll be talk of raising designed to achieve the desired effect without actually following through. 

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"But, we should worry about property prices overheating and my concern is that if inflation rockets as it is starting to, the Bank of England will respond with higher interest rates to stem it, as that is their brief after all. Such a response would be a grave mistake though "

 

!?!?!

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7 hours ago, Si1 said:

there are good economists on either side of the debate of this

 

There is no debate> The inflation is occurring as predicted by Austrian economists as a result of the increasing money supply.  

Its just taken a while to show up  

Edited by Warlord
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39 minutes ago, Warlord said:

There is no debate> The inflation is occurring as predicted by Austrian economists as a result of the increasing money supply.  

Its just taken a while to show up  

As companies go bust, the money is destroyed, they dont know if they can keep creating it as fast as it's disappearing.

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Quote

There is a wall of cash looking for a profitable home.

So this is interesting. Often the "cash on the sidelines" argument for stocks.

Let's say this is true. What happens when this "wall of cash" is used in property transactions? It doesn't just disappear in a puff of smoke, so is there still a "wall of cash" afterwards? After all, the people who sold the properties now presumably have all the cash. Would they now turn around and buy the properties back at a higher price?

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20 minutes ago, Locke said:

So this is interesting. Often the "cash on the sidelines" argument for stocks.

Let's say this is true. What happens when this "wall of cash" is used in property transactions? It doesn't just disappear in a puff of smoke, so is there still a "wall of cash" afterwards? After all, the people who sold the properties now presumably have all the cash. Would they now turn around and buy the properties back at a higher price?

there's a wall of cash..... yet the BoE should not do anything to control it as that would be BAD.

Edited by Si1
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1 hour ago, Locke said:

So this is interesting. Often the "cash on the sidelines" argument for stocks.

Let's say this is true. What happens when this "wall of cash" is used in property transactions? It doesn't just disappear in a puff of smoke, so is there still a "wall of cash" afterwards? After all, the people who sold the properties now presumably have all the cash. Would they now turn around and buy the properties back at a higher price?

They might spend it on expensive 4x4s that lose value in a few years, the money disappearing like smoke...

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13 hours ago, Si1 said:

"But, we should worry about property prices overheating and my concern is that if inflation rockets as it is starting to, the Bank of England will respond with higher interest rates to stem it, as that is their brief after all. Such a response would be a grave mistake though "

 

!?!?!

Normally set of idiot responses, when the person has got stuff **** about face.

The economy/wages drive the property market. Not the other way around.

 

Russell Quirk is co-founder of Proper PR, the property focussed PR agency, and an estate agent for 25 years.

 

edia commentator on all things #property and politics. Co-Founder at ProperPR *the* property #PR specialist. NED. Prop Ind Eye columnist. Pronouns: Genius/git

 

 

 

https://www.russellquirk.co.uk/

A property expert prolifically quoted by the UK’s biggest publications and media outlets

For many years I have been prolifically quoted as a leading property expert on the property market, housing and the estate agency industry by the UK’s most popular publications and media outlets. I use ipDTL to ensure a clear and reliable interaction. 

 

 

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I think the idiot is mistaking journos looking for cheap filla with genius ....

https://uk.linkedin.com/in/russell-quirk

  • Co-Founder

    ProperPR (formerly Properganda)

    Sep 2018 - Present2 years 11 months

    London, United Kingdom

    In 2014 whilst CEO of Emoov, I took PR in-house due to being constantly disappointed with the agencies that we'd hired. They simply couldn't keep up with the pace that I wanted and were generally lacking in great creative ideas.

    For four years we created, researched and delivered output that led to over 2000 pieces of press and broadcast coverage for Emoov each year across the BBC, Sky, ITV, the Telegraph, FT, Daily Mail, Express, Evening Standard, Huffington etc and hundreds of trade…

    Show more 
  • Property Industry Eye Graphic

    Columnist

    Property Industry Eye

    Jul 2020 - Present1 year 1 month

    Prolific opinionator and fire-starter. I write about issues that matter to the property industry and I say what the majority of sensible, right minded industry folk are secretly thinking. It’s all meant in the spirit of debate and improvement.
    And if you don’t get or agree with my sense of humour, we’ll that’s on you.

  • All Media Graphic

    Property Expert for Media

    All Media

    Jan 2015 - Present6 years 7 months

    London, United Kingdom

    Since 2015 I’ve provided regular insightful comment to broadcast media and the press on the housing market and the property industry.

    I’m ultra knowledgeable on all aspects of property and including house prices, housing supply, lettings, buy-to-let and especially the implications and effects of government policy and political announcements on the housing market.

    Comfortable at all levels within the media and my past appearances include TalkRADIO (regular), LBC (regular), BBC…

    Show more 
  • HomeHapp Graphic

    Advisor to the Mittal Family

    HomeHapp

    Apr 2019 - Sep 20196 months

    London, United Kingdom

    Short term project to advise the Mittal family on strategy, proposition, marketing and the ins and outs of U.K. property sector in order to facilitate the launch of Vyomm, their Prime London PropTech platform.

  • Tepilo - Online Estate Agency Graphic

    CEO

    Tepilo - Online Estate Agency

    May 2018 - Dec 20188 months

    London

    Acquired Tepilo, founded by Sarah Beeny, in May 2018 to create the number one competitor to Purplebricks

  • Emoov Graphic

    Founder & CEO

    Emoov

    Jan 2010 - Dec 20189 years

    National

    Founded one of the UK’s best known online Estate Agency businesses. £6m annual revenues. 140 staff. 30,000 customers. £6bn of property sales. Venture backed. Multi customer service award winning. Best Online Estate Agency 2015, 2016, 2017, 2018.

    • Chairman - Asset & Enterprise Committee

      Jun 2013 - May 20152 years

      Brentwood

      The lead member for land and premises oversight and innovation at Brentwood Borough Council. Formulated and introduced the council's Asset Strategy that is now transforming our publicly owned land and surplus properties into rental income and capital gain. Acquisitions too as 'invest to earn' Unashamedly entrepreneurial. National Government are now utilising a similar approach.

      Chairman, William Hunter Way Delivery Group. The panel tasked with consulting on, scoping and agreeing a viable…

      Show more 
    • Councillor

      May 2006 - May 20159 years 1 month

      Elected member. Chairman of the Council's Planning and Development Control Committee

    • Chairman - Planning Development & Control Committee

      May 2008 - Feb 20101 year 10 months

      Brentwood

      Strategic oversight of Brentwood Council's Planning policy. Lead decision maker on planning applications across the borough.

  • Phoenix 98 FM Graphic

    Presenter

    Phoenix 98 FM

    Jun 2010 - Aug 20111 year 3 months

    Brentwood

    Volunteer community radio presenter. Launched The Soap Box, an inquisitive face to face weekly guest show interviewing key local politicians, community leaders and business people.

  • Quirk Deakin Graphic

    Co-founder and Director

    Quirk Deakin

    Feb 1999 - Nov 200910 years 10 months

    Busy, popular estate agents at Canvey Island, Basildon, Grays, Billericay, Laindon and Stanford le Hope, sold in 2009. Subsidiaries include Property People property recruitment (sold); Let-It B, lettings (sold) and Partner Homes housing developers.

  • Lancaster PLC Graphic

    Senior Sales Executive

    Lancaster PLC

    Feb 1994 - Sep 19995 years 8 months

    London, United Kingdom

    Specialist performance car sales executive responsible for new and pre-owned Porsche and Ferrari sales at UK's top dealership.

    Achieved Number One specialist car sales individual title in Lancaster (Jardines Mtrs) group amongst entire specialist car division.

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35 minutes ago, spyguy said:

I think the idiot is mistaking journos looking for cheap filla with genius ....

https://uk.linkedin.com/in/russell-quirk

  • Co-Founder

    ProperPR (formerly Properganda)

    Sep 2018 - Present2 years 11 months

    London, United Kingdom

    In 2014 whilst CEO of Emoov, I took PR in-house due to being constantly disappointed with the agencies that we'd hired. They simply couldn't keep up with the pace that I wanted and were generally lacking in great creative ideas.

    For four years we created, researched and delivered output that led to over 2000 pieces of press and broadcast coverage for Emoov each year across the BBC, Sky, ITV, the Telegraph, FT, Daily Mail, Express, Evening Standard, Huffington etc and hundreds of trade…

    Show more 
  • Property Industry Eye Graphic

    Columnist

    Property Industry Eye

    Jul 2020 - Present1 year 1 month

    Prolific opinionator and fire-starter. I write about issues that matter to the property industry and I say what the majority of sensible, right minded industry folk are secretly thinking. It’s all meant in the spirit of debate and improvement.
    And if you don’t get or agree with my sense of humour, we’ll that’s on you.

  • All Media Graphic

    Property Expert for Media

    All Media

    Jan 2015 - Present6 years 7 months

    London, United Kingdom

    Since 2015 I’ve provided regular insightful comment to broadcast media and the press on the housing market and the property industry.

    I’m ultra knowledgeable on all aspects of property and including house prices, housing supply, lettings, buy-to-let and especially the implications and effects of government policy and political announcements on the housing market.

    Comfortable at all levels within the media and my past appearances include TalkRADIO (regular), LBC (regular), BBC…

    Show more 
  • HomeHapp Graphic

    Advisor to the Mittal Family

    HomeHapp

    Apr 2019 - Sep 20196 months

    London, United Kingdom

    Short term project to advise the Mittal family on strategy, proposition, marketing and the ins and outs of U.K. property sector in order to facilitate the launch of Vyomm, their Prime London PropTech platform.

  • Tepilo - Online Estate Agency Graphic

    CEO

    Tepilo - Online Estate Agency

    May 2018 - Dec 20188 months

    London

    Acquired Tepilo, founded by Sarah Beeny, in May 2018 to create the number one competitor to Purplebricks

  • Emoov Graphic

    Founder & CEO

    Emoov

    Jan 2010 - Dec 20189 years

    National

    Founded one of the UK’s best known online Estate Agency businesses. £6m annual revenues. 140 staff. 30,000 customers. £6bn of property sales. Venture backed. Multi customer service award winning. Best Online Estate Agency 2015, 2016, 2017, 2018.

    • Chairman - Asset & Enterprise Committee

      Jun 2013 - May 20152 years

      Brentwood

      The lead member for land and premises oversight and innovation at Brentwood Borough Council. Formulated and introduced the council's Asset Strategy that is now transforming our publicly owned land and surplus properties into rental income and capital gain. Acquisitions too as 'invest to earn' Unashamedly entrepreneurial. National Government are now utilising a similar approach.

      Chairman, William Hunter Way Delivery Group. The panel tasked with consulting on, scoping and agreeing a viable…

      Show more 
    • Councillor

      May 2006 - May 20159 years 1 month

      Elected member. Chairman of the Council's Planning and Development Control Committee

    • Chairman - Planning Development & Control Committee

      May 2008 - Feb 20101 year 10 months

      Brentwood

      Strategic oversight of Brentwood Council's Planning policy. Lead decision maker on planning applications across the borough.

  • Phoenix 98 FM Graphic

    Presenter

    Phoenix 98 FM

    Jun 2010 - Aug 20111 year 3 months

    Brentwood

    Volunteer community radio presenter. Launched The Soap Box, an inquisitive face to face weekly guest show interviewing key local politicians, community leaders and business people.

  • Quirk Deakin Graphic

    Co-founder and Director

    Quirk Deakin

    Feb 1999 - Nov 200910 years 10 months

    Busy, popular estate agents at Canvey Island, Basildon, Grays, Billericay, Laindon and Stanford le Hope, sold in 2009. Subsidiaries include Property People property recruitment (sold); Let-It B, lettings (sold) and Partner Homes housing developers.

  • Lancaster PLC Graphic

    Senior Sales Executive

    Lancaster PLC

    Feb 1994 - Sep 19995 years 8 months

    London, United Kingdom

    Specialist performance car sales executive responsible for new and pre-owned Porsche and Ferrari sales at UK's top dealership.

    Achieved Number One specialist car sales individual title in Lancaster (Jardines Mtrs) group amongst entire specialist car division.

 

Property expert who styles himself as a fire-starter?

[email protected] :rolleyes:

PAY-Raging-fire-started-by-a-tumble-drye

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2 hours ago, Longtermrenter said:

They might spend it on expensive 4x4s that lose value in a few years, the money disappearing like smoke...

So Land Rover dealerships need to watch out for smoke pouring out of their cash registers?

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On 07/07/2021 at 13:55, sammersmith said:

Nothing short of alien invasion or nuclear apocalypse would cause them to increase interest rates above 1%. It's game over if they do and they know it. They'll be talk of raising designed to achieve the desired effect without actually following through. 

I suspect this is exactly how it'll happen, in the short term at least. It'll cause Libor to to rise and therefore the rates on new mortgages. People on existing products will see what's happening, lock-in and sit happy whilst some unwinding of house prices occurs as people can no longer afford that much debt.

 

6 hours ago, zugzwang said:

 

Property expert who styles himself as a fire-starter?

[email protected] :rolleyes:

PAY-Raging-fire-started-by-a-tumble-drye

Sad fact is the the other half of that semi was probably still appreciating in price as that was happening.

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