Thursday, May 5, 2011

Why house price slump could pick up speed

Why house price slump could pick up speed

Low interest rates and a relatively low rise in unemployment have helped the property market make a soft landing - but George Osborne could spoil all that

Posted by becky @ 12:29 PM (3059 views)
Please complete the required fields.



17 thoughts on “Why house price slump could pick up speed

  • mark wadsworth says:

    That’s a fair if uninspiring summary, but it’s a bit spiteful to say that George Osborne is going to ruin things – it was The Labour Party who rode the Home-Owner-Ist bandwagon for all it was worth and allowed house prices to be driven up to stupid levels. The Tories are just continuing in a similar vein, having realised that it’s electoral gold.

    Reply
    Please complete the required fields.



  • letthemfall says:

    But the Tories started it. Oh yes they did …

    Reply
    Please complete the required fields.



  • mark wadsworth says:

    LTF, let’s be fair here.

    Politicians didn’t just invent Home-Owner-Ism overnight. They got rid of Schedule A tax and in the early 1970s (under Heath) there was a bubble; Thatcher/Major had a nice bubble in the 1980s and went a little bit further with council house sales (a policy which Labour continued with great gusto!)and replcacing Dom Rates with Council Tax.

    But to Major’s great credit, he didn’t bother propping up house prices when he was in charge, neither did he bail out banks (Barings, BCCI). And the Powers That Be made sure that the Tories learned a lesson by keeping them out of government for ages.

    It was only New Labour who made the direct correlation between “rising house prices” and “being re-elected” and adopted it as their main economic policy.

    And as Uncle Tom reminds us, more houses were built under Tories than under Labour – the problem with HO-ism is that it sows the seeds of its own destruction – new construction started falling markedly in mid 1970s once more than half of people were owner-occupiers. NIMBYism as a major political force has risen in inverse proportion to the number of new builds, reaching its apogee with “The New Localism”.

    Reply
    Please complete the required fields.



  • letthemfall says:

    I certainly don’t defend Labour’s policies that helped the latest house bubble on its way up, though I think Thatcher pretty much invented, or at least made a core value of the HO-ist creed.

    I don’t think one can compare Barings and BCCI with the recent bank bailouts. But I agree that nimbyism is very strong, though I feel this is another manifestation of the defence of great privilege rather than the rate of house building, though the reverse may well be true.

    Reply
    Please complete the required fields.



  • “Why house price slump could pick up speed???”

    Err let me see now. The expansion of money creates inflation and we have almost worn that sucker out!

    Can’t have the rabble out on the streets rioting instead of being homeless now can we.

    “I have another cunning plan Black Adder. Shut it Baldrick.”

    Reply
    Please complete the required fields.



  • mark wadsworth says:

    LTF, I’d even give Thatcher the benefit of the doubt – I don’t think she realised what monster she had created.

    Yes of course she was nascent Home-Owner-Ist but her big crimes were flogging off council houses at undervalue and scrapping Dom Rates. The Tory 1980s bubble pales into insignficance against the Labour one and as it happened quite quickly (from 1985 to 1989?) it might have had some small influence on outcome of 1987 election but not like Labour in 2001 and 2005. Or indeed 2010 which they lost largely because of house price bubble bursting (for sure, people say they lost it because of financial crisis, but that in turn is the flipside of the housing bubble)

    Reply
    Please complete the required fields.



  • the number cruncher says:

    MW – You are quite correct, but the other side of the equation is the supply of money to fuel the boom. Mrs T’s wanted a free market revolution but to get it she had to make a pact with the devil in the form of bankers and landowners in her party. She allowed the big financial interests to get the ball rolling with changing the mortgage/banking market and without that the HO’ist nightmare would not have been able to unfold to the extent it did.

    A plague on both their houses,

    My own view is politicians decide little and it is the economic topology and party in-fighting (backed by powerful lobby interests) that made Mrs T, Blair and Brown make the choices that jumping on a speculative band wagon’s would keep them in power.

    The right wing press killed Major with sleaze, Europe and faint praise, but they did not deliver the coup de gr̢ce until they knew Blair was their man. As you are no doubt becoming painfully away the right wing press has an amazing ability to influence the outcome of elections and referendums and can easily make a 5 Р10 % swing through fear and lies.

    Reply
    Please complete the required fields.



  • mark wadsworth says:

    TNC, for sure, in amongst privatising a lot of other stuff (which by and large I agree with), she loosened the reins on the banks (with benefit of hindsight, we can see that this was a bad thing) but all things considered, banks were still better regulated under Tories than under Labour (I can’t remember many going bust apart from BCCI and Barings but they are special cases), and as I was saying, Thatcher did not realise what monster she had created or that Labour would take it to its logical conclusion and have it as central plank of economic policy.

    As to the No-2AV propaganda, that turns my stomach, and makes me realise that we’d never win an “out” vote in an EU referendum because the press would unanimously (from Guardian, FT all the way to Sun and Times, possible exceptions Daily Mail and Daily Express – who are anti-EU for the wrong reasons so not very convincing) churn out nonsense saying “Three million jobs depend on EU membership” and “EU guarantees human rights in the UK” and so on.

    Reply
    Please complete the required fields.



  • the number cruncher says:

    I often think in terms of 50 or 100 year cycles and so it is with ‘some’ parts of economics, the follies of Thatcher can take 30 years to materialise, like wise for the hidden follies of Blair and Brown. We will see the folly of PFI and some of their other actions unfold over the next 3 decades. The ‘blowback’ from the folly of the wars of conquest in the middle east will last 100 years.

    Reply
    Please complete the required fields.



  • mw @7

    Went to vote today and was actually asked if I wanted a referendum paper!

    Told me something.

    Oh. and while the subject is fleetingly current, why wasn’t Proportional Representation on the ballot paper? As usual, British democracy is defined by having no choice about the choice you’re given. I think there’s a term for that!

    Reply
    Please complete the required fields.



  • wiltshire says:

    Proportional Representation? Are you completely mad??? You’ll be wanting women to be able to vote next!

    You can choose between AV (aka a ‘miserable little compromise’) and FPTP and you should be thankful for that broad selection!

    Reply
    Please complete the required fields.



  • greenmind says:

    It irks me that one of the arguements used by the NO camp is that “AV isnt even PR” when it was the NO camp who prevented the PR option on the ballot paper in the first place! Pr*cks!

    Reply
    Please complete the required fields.



  • 5. mark wadsworth said…”LTF, I’d even give Thatcher the benefit of the doubt – I don’t think she realised what monster she had created.”

    ~ Mrs T showed how easy it was to buy the voters. It’s not just the Americans that are plain stupid, “ask Fred!”

    She was also responisiblaller for mis- leeding every one in to thinking what they could step up an klarse by not getting ther ands dirtie.

    Reply
    Please complete the required fields.



  • MW “Three million jobs depend on EU membership” and “EU guarantees human rights in the UK” and so on.

    ~ Does that go for the sex slaves they traffic also? Don’t believe me, look it up.

    Reply
    Please complete the required fields.



  • Couldn’t make my mind up on AV so audibly went eeny meeny miny mo you are not it. On the way out chatted to one of the voting staff who was at the door reading a book and bearing in mind it was 7pm and things were picking up a bit they had only so far averaged 10 voters per hour. I therefore suspect that the voting turnout will be an all time low which hardly gives credability to any referendum.

    Reply
    Please complete the required fields.



  • If you voted ‘no’ to AV, could you choose ‘yes’ as your second choice??

    Reply
    Please complete the required fields.



  • I don’t have any particular feelings about Mrs T, but I think she (and anyone else) was absolutely nuts to sanction the sell-off of our critical national infrastructure. Power, oil, gas, telecoms and transport infrastructure sould be maintained in the national interest, as when the sh*t hits the fan…it’ll be China-town baby…

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>