Saturday, May 16, 2009

Uk

Home repossessions jump by 50 per cent

This article is about rising repossessions. However, I would urge all regular posters to the site to stop looking at the UK so much. Our economy, inflation, and interest rates, or perhaps the timing of its demise, are going to depend on events abroad.

Posted by stillthinking @ 07:27 PM (3471 views)
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5 thoughts on “Uk

  • @stillthinking,
    Yes, lots of things are happening abroad, as you say. Surely UK jobs (and job security), interest rates and inflation are the most important factors to consider when buying a house. They have a big impact on house prices.

    What are the “events abroad” which you refer to? How important will they be, and why?

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  • I second Alan’s question – to what “events abroad” do you refer?

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  • stillthinking says:

    anything you notice… I don’t know, take it all together. for example, Japan (the government) is moving towards a very high borrowing requirement, irrespective of being a creditor nation, and the pension funds are about to stop contributing because demographic hump of pensioners has just about arrived. Basically a possibility of deflation ending there. There is deflation in China. Europe is contracting more than the UK…
    The UK will be heavily affected by global demand for borrowing, and also given that our recovery will be later, which other country looks like recovering.
    I don’t know really but I do know what is happening in the UK and I think any change is coming from abroad. For example, there could be a wage collapse in the UK but rising prices in the shops, but masked by foreign over-production.
    Anything anybody thinks is of interest.

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  • stillthinking says:

    I wish I hadn’t put that post as it is because really there are a lot of posts about foreign stuff, and I also don’t know which events to look for, but I would maybe recognise one. But I think that most people on this site may have started out looking to buy a house and trying to time the purchase for the bottom of the market. However, now events have moved on and we/I have become more clued up about economics to some extent, maybe it is time to consider, as a possibility, that it will -never- be a good move to buy a house in the UK, and that perhaps there is a lot of money to be made by strategically shifting money around, and this is a good forum to discuss that. Consider, those that sold to rent and also moved money out of sterling, neither of which was a major gamble really, have made a life changing amount of money from that. What is certainly going to be true is that there will be a lot of volatility going forward. Also, there seems to be a element of dominos/cascading financial triggers between countries, of course always there but not as strong as now.
    Basically at some point one country is going to have to raise interest rates, one country is going to break ranks, the idea of a global reflation i.e. all countries cooperating, no, some country is going to act differently. Also there is no point thinking about buying a house in the UK today, tomorrow, this year, next year so what are you going to do with your money in the meantime.
    Events like Australia maybe introducing quantative easing. Anything. Any alternative to the idea of using UK housing stock as a savings vehicle. The market and the western world are in debt management, so anybody with savings is in an ideal position, savers in the UK are whinging at the minute because of zero returns. Rubbish, that is them. The situation now is ideal for savers, just moving money to a German bank over the last year (hardly a risky gamble) would have made 25% return. The closest alternative to housing that is usually discussed is only gold, and nothing else. There is a magic sequence out there that in retrospect will appear obvious.

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