Tuesday, July 27, 2010

Philip Coggan comments on the British housing bubble

What goes up must come down

House prices are finally obeying the laws of gravity. The Halifax measure has fallen in four of the past five months, the Royal Institute of Chartered Surveyors survey shows new buyers are starting to dry up, while even the Rightmove survey of asking prices suggests seller optimism is starting to evaporate.

Posted by jack c @ 03:37 PM (2994 views)
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8 thoughts on “Philip Coggan comments on the British housing bubble

  • “the resulting rise in borrowing costs will help existing homeowners”

    eh?

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  • That’s what I thought inbreda, but I didn’t want to be the first one to put up their hand and say “Sir, I don’t understand”

    Also, I wanted to comment on “The lack of new housing supply is a very slender reed on which to hang hopes of higher house prices”

    It’s very VI. Who exactly are the people hanging hopes on higher house prices?

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  • “the resulting rise in borrowing costs will help existing homeowners” – I believe that should be hit not help.

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  • “FTAdviser.com is the FT’s all-encompassing website dedicated to the financial intermediary market, covering investments, mortgages, pensions, insurance, regulation and other key issues shaping the market.”

    If you’re an independent financial adviser, your clients are people with lots of money. They are almost certainty homeowners and chances are they have a BTL aswell. Even those clients who aren’t heavily invested in property will feel a negative wealth effect from lower house prices, and will be more reluctant to shell out for fancy investment advice. If you’re an adviser, you care a lot about the housing market.

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  • The really smart people with money don’t need financial advisors or higher house prices. They sell when it’s the right time to sell and buy when it’s the right time to buy, it’s that simple and no simpler.

    I always enjoy watching Jim Rogers being interviewed, whenever he is asked by the presenter “So where are the markets headed” he always answers the same way which is usually something like: “I’m not smart enough to know that. If you want to find that out you should watch [whatever show he is a guest of], you always have loads of smart people on telling you exactly what the markets will do”…brilliant!

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  • 5. estrader said…

    The really smart people with money don’t need financial advisors or higher house prices. They sell when it’s the right time to sell and buy when it’s the right time to buy, it’s that simple and no simpler.

    Which was when?….and what do they do if life happens at a bad time?

    Jeez – get over yourself.

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  • mark wadsworth says:

    All grist to the mill.

    @ estrader 5, too true, but predicting what will happen to interest rates, asset prices etc is, to a large extent, predicting what policies governments will adopt, insane or otherwise. One of the main functions of governments is to create opportunities for speculators. Like people with lots of cash who are hoping that governments will allow interest rates to rise and so on. Or like a good time to buy oil futures is shortly before war breaks out in the middle east yet again.

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  • @Braindeed, “Which was when?….and what do they do if life happens at a bad time?”

    Ask your financial adviser *LOL*

    RC:deadhead borders

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