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Jeff Randall :please Say I'm Wrong Over House Prices

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Guest muttley

http://www.telegraph.co.uk/money/main.jhtm...22/ccjeff22.xml

If I'm missing something here, please write and tell me. If I'm not, it seems that for many would-be buyers, house prices have delinked from economic reality.

The gap is being filled by unsustainable borrowings, which, I believe, will lead inevitably to a surge in repossessions.

I'm REALLY beginning to like this guy.

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house prices have delinked from economic reality.

Which explains, somewhat, why the likes of Kirsty Allsop remain bullish... Her celebrity wages are also totally delinked from the economic reality of the relative 'peanuts' that the rest of us have to scrape by on. I've always found that people who can afford stuff are totally oblivious to the fact that there are also people who can't. Let them eat cake :rolleyes:

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Which explains, somewhat, why the likes of Kirsty Allsop remain bullish... Her celebrity wages are also totally delinked from the economic reality of the relative 'peanuts' that the rest of us have to scrape by on. I've always found that people who can afford stuff are totally oblivious to the fact that there are also people who can't. Let them eat cake :rolleyes:

Even though Kirsty has equity from her first flat, which her granny helped her to buy and even though she has "celebrity wages" I am pretty sure she would struggle to upgrade from her flat to a house in the same area, on her own.

What is more, I think she now realises this.

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More then the price difference the fact that wages have not grown which shrink the mortgage as a proportion of the salary which has always allowed people to move up the ladder faster before..

There has never been a time before where inflation did not pay of a mortgage in real times faster then a repayment mortgage..

This has killed the ladder, I have quoted Mervin King in this below..

After massive house price inflation before a huge wage push inflation would follow.. this also used to protect people from huge debt that they had taken on..

This has gone now.

So what do people do now? wage increases are not out there (on average the salaries are dropping)

So how do they spend more? after a few years they don't get paid more there debt is just as big..

So they borrow more, to spend.. They mew...

So wages are dropping (on average) the average person is getting into more debt then ever before, even if they are already a home owner.. and the frantic house building of the past few years has left an oversupply of houses.

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Ah, I can hear you say, but what about savings? Mr and Mrs Average don't have to borrow the full amount to buy the average house, because they have some cash tucked away.

What he seems to have forgotten about is that Mr & Mrs Average usually have an 'average' amount of equity in their current house. Why did he ignore that? It's a pity, because I liked the tone of the article and its headline. Should contribute another bit towards the change in sentiment.

p

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This has killed the ladder, I have quoted Mervin King in this below..

Who's Mervin King?

If you're so infatuated with the guy the least you could do is spell his name right. It's only polite.

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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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