Tuesday, February 24, 2009
Pity it’s Toynbee
House prices are still far too high - they are only back to about 2006 levels, still crazy money. Prices need to fall further to regain any reasonable multiple of people's incomes. But every time prices fall, another round of bad debts hurt the banks' balance sheets and the taxpayer has to pump in more. The nation is still deeply dependent on house prices rising for ever. We still live in a bubble economy, with no way to live except by reinflating it. The state itself has been mainlining on the house-price drug, as addicted as the happy home-owners. Please can we have our bubble back, clamours just about everyone. The 70% who own homes and those who dashed into buy-to-let property yearn for the magical unearned wealth that came from nowhere.