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Realistbear

Guardian Mention The " C" Word For The First Time

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http://observer.guardian.co.uk/business/st...1859024,00.html

US housing slump fuels crash fears

Foundering American property market could spark global slowdown worse than dotcom collapse

Heather Stewart, economics correspondent

Sunday August 27, 2006

The Observer

The downturn in the US housing market will force businesses to slash 73,000 jobs a month in the new year and could be
more damaging to the world economy than the dotcom crash, economists have warned.
After official figures last week showed that the number of new homes sold in July was 22 per cent lower than a year earlier, while prices were almost flat, fears are mounting that the 'orderly' housing slowdown predicted by the Federal Reserve will become a full-blown crash....../
'For a wealth-dependent US economy, the bursting of another major asset bubble is likely to be a very big deal,' he said, warning that, with US fiscal and trade imbalances now larger than five years ago,
the fallout for the rest of the world could be more devastating than the aftermath of the dotcom boom.
'A bursting of the property bubble poses equally serious risks for America's key trading partners and for the rest of an increasingly integrated global economy,' he added.
Anxieties about the fragile US housing sector come as analysts in the UK debate whether this month's rise in interest rates will dent prices here.
Property website Hometrack will warn tomorrow that the so-called 'mini-boom' that has buoyed the market in London over the past few months will be snuffed out by higher mortgage costs.

Pleasant reading for a Sunday afternoon? Seriously though, it is inevitable, IMO, that the US crash will have a fallout over here. As the article says, Hometracks report due to come out will spread even more doom and gloom begun by RM a few days ago. The negative housing reports are stacking up and RICS are spinning like a half dead bee trying to convince the sheeple otherwise.

Edited by Realistbear

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Saw this just now & I've got the relatives arriving imminently. If the subject gets onto housing, slapping that down will help justify my side nicely. :D

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Right that's it then.

I'm quitting my job as an estate agent tomorrow and perhaps become a civil servant,or in my case an uncivil servant.

At least the government will supply tin helmets and a bunker when the peasants start to revolt again.

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Guest mattsta1964

Right that's it then.

I'm quitting my job as an estate agent tomorrow and perhaps become a civil servant,or in my case an uncivil servant.

At least the government will supply tin helmets and a bunker when the peasants start to revolt again.

Civil servants.....................

Not civil

Don't serve

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This really annoys me

For a wealth-dependent US economy, the bursting of another major asset bubble is likely to be a very big deal,' he said, warning that, with US fiscal and trade imbalances now larger than five years ago, the fallout for the rest of the world could be more devastating than the aftermath of the dotcom boom.

Now they're quoting Roach about the US property bubble.

In Florida, you can buy a 4 bed house with a double garage and swimming pool for about £120k.

That's in a place with a nice climate, close to the sea. At the top of a massive property bubble.

The same money in the UK will buy you a rubbish 1 bed flat somewhere on the ass-end of Birmingham.

But you just don't find UK newpapers talking about the housing bubble over here, which by many measures is significantly worse.

Anyone with just a tiny amount of common sense can see we've got a major problem.

That says a lot about UK newspapers, and the fools who read them.

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This really annoys me

Now they're quoting Roach about the US property bubble.

In Florida, you can buy a 4 bed house with a double garage and swimming pool for about £120k.

That's in a place with a nice climate, close to the sea. At the top of a massive property bubble.

The same money in the UK will buy you a rubbish 1 bed flat somewhere on the ass-end of Birmingham.

But you just don't find UK newpapers talking about the housing bubble over here, which by many measures is significantly worse.

Anyone with just a tiny amount of common sense can see we've got a major problem.

That says a lot about UK newspapers, and the fools who read them.

Agreed. Within the OECD countries the UK has some of the worse value for money houses.

The small island, high population can explain some of it but the UK does have a real property obsession compared to other countries.

They seem to have better things to talk about at dinner parties and view a house as a place to live for a few years rather than 'an investment'.

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Agreed. Within the OECD countries the UK has some of the worse value for money houses.

The small island, high population can explain some of it but the UK does have a real property obsession compared to other countries.

They seem to have better things to talk about at dinner parties and view a house as a place to live for a few years rather than 'an investment'.

Well I agree that the UK has some of the worst housing, and Brits seem to take great pleasure in paying ridiculous prices for squalid accomodation.

When is your average Pom going to wake up to this stupidity?

Many of the houses in this country would be deemed uninhabitable if they were in Germany.

Your argument about small country doesn't fit either, Germany has a very similar population density to the UK yet prices and quality couldn't be further apart, on both factors.

Don't worry about the dinner party chat, no-one likes to talk about those bombed dot-com shares they're still holding because they didn't sell out in time.

When house prices have been falling for 5 years it will be socially unacceptable to talk about how much your neighbour (and your friends) have lost.

Edited by BandWagon

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I don't think people will wake up- not until some of those gawd awful TV shows start showing the dark underbelly of amateur property developing- the parts where people don't make a fortune by simply slapping a bit of paint about and whacking down some horrid laminate. If they showed people who did all that messing about and ended up selling for a loss or found that taking a deposit to play with from their existing mortage wasn't such a good idea a lot less people would buy into the idea of how wonderfully easy it is to make mega bucks from simply buying and selling a house.

The way these shows lay everything out is very appealing- I'd be interested in any money making scheme where I could make a stack of cash without having to put my own, real money into it and where no one ever lost out. I wouldn't give a toss how far in debt I was cos nothing can go wrong- never, ever.

I'm deeply synical about almost everything to do with houses- all the people you have to deal with have a vested interest in fleecing you- the amount of people I know who really do think their house is worth what some spotty face spiv from the local EA tell them it is is scary- the fact that the more he says it's worth the more money he stands to get doesn't seem to register.

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Well I agree that the UK has some of the worst housing, and Brits seem to take great pleasure in paying ridiculous prices for squalid accomodation.

When is your average Pom going to wake up to this stupidity?

Many of the houses in this country would be deemed uninhabitable if they were in Germany.

Your argument about small country doesn't fit either, Germany has a very similar population density to the UK yet prices and quality couldn't be further apart, on both factors.

Don't worry about the dinner party chat, no-one likes to talk about those bombed dot-com shares they're still holding because they didn't sell out in time.

When house prices have been falling for 5 years it will be socially unacceptable to talk about how much your neighbour (and your friends) have lost.

So truth....and I'm German ;) some of the stuff they selling here for 250-300k would not even be thought of suitable for social housing :o

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I think there's something in the English psyche that makes us equally greedy and gullible - having all this debt, the lastest 4x4 etc. compared to our european neighbours.

I'm not so sure: I think a large part of the problem is that since the collapse of the Empire, a large fraction of the 'go-getters' in Britain have emigrated to better opportunities abroad, in America and elsewhere, leaving the greedy and gullible behind. The Germans and other non-English-speaking Euro nations don't seem to have suffered so much of a 'brain drain'.

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The same has happend in most anglo-celtic countries. In Australia and New Zealand property spruikers appeared overnight frightening people that their pension/superannuation won't cover them in retirement so in the major cities here investors have outstripped 1st time buyers. In the Western Suburbs of Sydney they are started to suffer with 30% to 40% drops in price since 2003. I have nothing against investors except its the amateurish investors who have driven the prices up, the real investors will be out buying those at bargain prices. Its a bit like the Dot com boom everyone was an expert in shares. Where there is alot of buyers the price goes up, until a point there is no buyers so the price comes down until someone buys except there is no buyers so the prices falls until buyers = Sellers.

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The whole problem has been engineered by the Governments on the Global basis to manufacture an economy post Sept 11th.

We have always had property booms and slumps, and for most of the public in the past they have not been actively engaged in it. They simply went with the flow.

However in an effort to manufacture and economy the Governments have promoted the philosophy of using property as a vehicle to make money. There have obviously been benefits as the economy has indeed ticked along whereas in the past it would have floundered in the old seven year cycle routine. However the policy of promoting property as an investment has failed as we all know its all paper money, and its all relative, what you sell for a so called profit, then is lost as you have to pay more for the next property. And the biggest flaw of all, is the the whole chirade is made up of ever increasing debt.

Look back to 1996 and the average Joe in the Street had a 50k mortgage on a property of 60k, today, same Joe, same house and the mortgage will be around 150K on the same property at 225K. Now of course he fells rich, he has on paper made far more money than he could possibly expect to save. But of course its only relative, when he sells, he has to pay more for the next property. So he has gained nothing, yet the Government and the Economy are the only ones to gain.

The whole chirade has been perpetuated by Governments holding back on the realease of land for Development, just take a look at Australia with a Population of 20million, Europe will fit into Western Australia alone, yet they make building land a scarce resource.

Let us all be under no illussions, it is our so called elected memebers of our state institutions that are intentionally creating this problem for the citizens they are elected to serve.

For the UK, New Labour has indeed spelt New Danger, and for Australia the partnership is even more obvious.

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I think there's something in the English psyche that makes us equally greedy and gullible - having all this debt, the lastest 4x4 etc. compared to our european neighbours. Wanting material things and becoming obsessed with houses is a symptom of sum underlying void in our lives - maybe we are not being fulfilled as individuals (either through work or family life) so seek the route of self gratification. Having it now not tomorrow - quantity rather than quality, the complete opposite to Germans I think.

When will the UK wake up FFS!!!

You ve hit on something there.

I know some french, spanish, argentines, who are over here.

Their culture is different..... When it comes to friends they dont show each other the newest thing they got or whatever. Its about having a good time

Also they see friends much more than us over here. We tend to keep to a core unit rather than staying close to extended family and friends, and talking to neighbours. Working the longest hours in eurpoe doesnt help either. Take the french they dont care if they strike.... and affect other countries around them

I maybe generalising, but we are far more materialistic.

Edited by notanewmember

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  • 341 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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