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warwickbloke

So, Come On Then...it's The Future.

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We're now at a place ahead in the future:

So the house prices have crashed.

To what level will they fall & when will all the FTBs that cannot buy yet have their dreams come true.

Of course when the first one decides they want a house, another will never come along & offer more because they find that house particularly appealing, will they.

Of course not, this was only the attitudes of those other people, these present generation know better & wish to protect the future generations by their unselfishness.

For the last 40 years the old codgers have been too selfish,greedy,short sighted, uncaring of their actions to give a damn about anything but themselves.

Now this will all end.

Hurrah!

So, magic formula then, how is this ridiculous house price rise situation never to happen again.

It seems that the popular reasoning is to raise interest rates & make borrowing less accessible.

Surely this will just serve to cause a lull for a while where all would be buyers save their cash for larger deposits & prices fall or flatline as nobody is in a position to buy, then the feeding frenzy begins again?

I perhaps am too simple to see a solution except for the peaks & troughs we had already caused by supply & demand.

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It all depends how much bigger the bubble gets. The more that get on the band wagon now, using lenders' increasingly convoluted schemes, the less will be left outside the market when the bubble bursts. This means prices will have to fall further before they reach those who have any money... ie, those who couldn't afford to get on the ladder whatever lenders came up with to tempt them.

I can borrow £60K if I'm sensible, or £85K if I go with the biggest loan I can get. I can raise about £15K, but some of that would be eaten by expenses... the cheapest property that meets my basic requirements right now is about £125K. I could actually overstretch myself and get something for about £125K, but I want to be living there for longer than it takes interest rates to go up by 0.5% and I don't fancy negative equity much, especially if I can't afford my mortgage, so I won't. Others in my situation probably would overstretch themselves, so I'll probably be among the richest of those left outside the market when it crashes.

Keep pumping the air in!

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We're now at a place ahead in the future:

So the house prices have crashed.

To what level will they fall & when will all the FTBs that cannot buy yet have their dreams come true.

Of course when the first one decides they want a house, another will never come along & offer more because they find that house particularly appealing, will they.

Of course not, this was only the attitudes of those other people, these present generation know better & wish to protect the future generations by their unselfishness.

For the last 40 years the old codgers have been too selfish,greedy,short sighted, uncaring of their actions to give a damn about anything but themselves.

Now this will all end.

Hurrah!

So, magic formula then, how is this ridiculous house price rise situation never to happen again.

It seems that the popular reasoning is to raise interest rates & make borrowing less accessible.

Surely this will just serve to cause a lull for a while where all would be buyers save their cash for larger deposits & prices fall or flatline as nobody is in a position to buy, then the feeding frenzy begins again?

I perhaps am too simple to see a solution except for the peaks & troughs we had already caused by supply & demand.

They will do precisely what they did after the last crash.

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Good question, though. What could be done to stop the boom/bust cycle?

How can we make property investment very unappealing, without penalising those buying for something to live in?

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Good question, though. What could be done to stop the boom/bust cycle?

How can we make property investment very unappealing, without penalising those buying for something to live in?

Tax second homes.

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Tax second homes.

It will still not deter the very rich who just want a second home to live in, at times convenient to them.

Nobody is complaining that there are not enough homes to go around, just that second home owners have forced the prices up, but they are not the only people who have purchased in recent years & instigated such high rises.

What about the sellers, nobody was forced to accept an overvaluation on their property. Any one of them could have said, "no, you are paying far too much, it will affect the market for FTB, I will accept only a fair price", but I doubt many of them did!

These are all marketable commodities.

A teddy bear,

A chair,

A bicycle,

A car,

A house,

Question: What are any of these items worth?

Answer: What somebody is prepared to pay for them!

How is it possible to control a price on any one of these items, let alone an item such as a house with all the anomalies it has.

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These are all marketable commodities.

A teddy bear,

A chair,

A bicycle,

A car,

A house,

Question: What are any of these items worth?

Answer: What somebody is prepared to pay for them!

How is it possible to control a price on any one of these items, let alone an item such as a house with all the anomalies it has.

I don't think your analogy holds; if they're subject to identical market forces, we'd see boom/bust cycles in teddy bears.

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I don't think your analogy holds; if they're subject to identical market forces, we'd see boom/bust cycles in teddy bears.

And why not?

Some teddy bears are out of your price range I'll bet.

If folk cannot put their spare cash into houses it may be teddy bears, some spend millions on paintings, this is just something you hang on a wall.

But how to prevent it?

There's been a few posts complaining the present house price situation could have been prevented. OK then, let's assume the whole thing is going to happen again as cycles do, what is to be done to deter the unsatisfactory turn of events re-occuring?

Or is this one of those:

"You did the wrong thing".

"Ok then what should I have done?"

"I don't know, but you did it wrong!"

Is anybody able to provide a sensible solution to allow consistent affordable home ownership, or is it just a peak & trough market that sometimes becomes unstable, as poor old simple me sees it.

Therefore it is nothing to have a valid complaint about, you just have to wait till the ride slows down enough for you to get on it.

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And why not?

Some teddy bears are out of your price range I'll bet.

If folk cannot put their spare cash into houses it may be teddy bears, some spend millions on paintings, this is just something you hang on a wall.

But how to prevent it?

There's been a few posts complaining the present house price situation could have been prevented. OK then, let's assume the whole thing is going to happen again as cycles do, what is to be done to deter the unsatisfactory turn of events re-occuring?

Or is this one of those:

"You did the wrong thing".

"Ok then what should I have done?"

"I don't know, but you did it wrong!"

Is anybody able to provide a sensible solution to allow consistent affordable home ownership, or is it just a peak & trough market that sometimes becomes unstable, as poor old simple me sees it.

Therefore it is nothing to have a valid complaint about, you just have to wait till the ride slows down enough for you to get on it.

I'll look forward to TeddyBearCrash.co.uk

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I think housing is different; a building to live in is a necessity, if only because you'll get roughed up by plod if you live on the streets! Teddy bears are a luxury.

Perhaps we can look at something in land reform. It seems to me that since nobody manufactures land (barring the draining of swamps etc.), the idea of a person being able to 'own' land is repugnant. Maybe all land should actually be rented from the government, who would manage land on behalf of the citizens. In this way, land prices could be more easily controlled. Should one rent land and then improve it in some way (e.g. by building a house on it) this could be allowed for in the rent, or by preferential treatment should the land lease expire.

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  • 301 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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