Friday, July 19, 2013
What the ponzi scheme needs to keep going – All wealth getting sucked in!
House prices set to soar by 20% in the next five years with average home costing almost £200,000
House prices will rise by nearly 20 per cent over the next five years with the cost of the average home reaching nearly £200,000, research revealed today. Savills, the upmarket estate agency, said it has upgraded its housing market forecast from a rise of 11.5 per cent by 2017 to a jump of 18.1 per cent. The research said ‘government intervention’ partly triggered the upgrade while critics warned the interventions are fuelling a house price boom but doing nothing to help lending to businesses.
Posted by hpwatcher @ 06:44 AM (3711 views)
16 thoughts on “What the ponzi scheme needs to keep going – All wealth getting sucked in!”
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dill says:
Has pump and dump written all over it.
happy mondays says:
Of course they will, but no fu*ker can afford one! Simples 🙂
jack c says:
Agree with Dill and whilst it maybe long after the horse has bolted the following will restrain rising prices (Lenders are already tightening up dramatically on IO lending)
The Financial Conduct Authority (FCA) plans to introduce a “robust underwriting assessment” to be performed by lenders before issuing interest-only mortgages, letters published today have revealed.
The regulator, which will take over the regulation of consumer credit next April, will toughen up the rules for credit lenders, particularly those issuing interest-only mortgages, Martin Wheatley, chief executive of the FCA wrote in a letter to chairman of the treasury committee Andrew Tyrie, published today.
Full article http://www.ifaonline.co.uk/ifaonline/news/2283417/fca-to-introduce-underwriting-assessment-for-interestonly-mortgages
techieman says:
Jack …. I find it highly amusing that the FCA is located at the same offices as the FSA (North Colonnade, CW) and has the same staff doing the same work :). Admittedly the PRA is a bit different… but even so!
But of course HMG can say that they have got rid of the FSA – remind me what the “S” stands for Shysters perhaps? Replaced with a C for ?????
My feeling is that between now and the new year “something” is going to happen that will put pressure on Ossy to think again about this ridiculous scheme.
Alan says:
dill,
You beat me to the comment!!!
“Pump and Dump”
Techieman,
“..between now and the new year “something” is going to happen that will put pressure on Ossy to think again..”
I sincerely hope so!
khards says:
house prices are a function of affordability, thus mortgage rates. Savills prediction is that mortgage rates will stay this low over the next 5 years. I would be inclined to disagree with that given the tightening situation in China pushing up US bond prices and hence UK mortgage rates.
It only takes one of the larger countries/areas to break away from the low bond rates for this lot to go down. IMO and using my rear-view mirror it looks far more precarious that buying into property in 2007. You have the US (non) recovery, China tightening, Japan falling to bits, Tech companies earning less, a new round of EU issues (Ireland, Greece, Spain, Portugal). We have been in a lull, a quiet spot for the last 12 months, the VI’s and media have been making the most of that.
hpwatcher says:
The same happened with the Tulips – all the wealth was getting thrown, by TPTB, in to keep tulip prices high to stop lots of [powerful] individuals from going bust!
mark wadsworth says:
Ahah, I read something interesting about tulips yesterday.
Apparently after the bubble popped loads of people owed other people loads of money, but the local courts simply refused to accept appeals by the “winners” for enforcement of payment against the “losers”, just like gambling debts didn’t used to be enforceable in this country.
So people lost of lot of sleep and might have made a few new enemies, but within a couple of months everything went back to normal and in net terms, not that much “wealth” was transferred from anybody to anybody else.
hpwatcher says:
Apparently after the bubble popped loads of people owed other people loads of money, but the local courts simply refused to accept appeals by the “winners” for enforcement of payment against the “losers”, just like gambling debts didn’t used to be enforceable in this country.
So people lost of lot of sleep and might have made a few new enemies, but within a couple of months everything went back to normal and in net terms, not that much “wealth” was transferred from anybody to anybody else.
I wonder what happened to the cost of tulips though?
khards says:
The housing bubble was different to the tulip bubble as people were able to bank the profits in advance as banks issued debt to the purchasers. It is too late to not bail out the banks and underwrite their commitments.
If banks did not issue mortgages then you would have to buy a house using a promise to the vendor that you would repay them.
mark wadsworth says:
Khards: “It is too late to not bail out the banks and underwrite their commitments.”
Would you like me to explain that this is entirely untrue and explain “debt for equity swaps” to you again? Do you know what the total Northern Rock losses are so far as a % of assets? About 4%? So the bond holders take a 4% loss and everybody gets on with their lives.
And if the government has to “bail out” anybody at all, then let them pay any depositors who lose out directly, instead of throwing money at the banks and expecting them to behave.
Think about Farepak – if the government had said “These poor savers have been diddled, we’ll reimburse them directly for half their losses” then most of us would have thought fair play. But if the government had paid a load of money to Farepak directly, there’s have been an outcry.
hpwatcher says:
DOUBLE NEGATIVE ALERT:
It is too late to not bail out the banks and underwrite their commitments.
khards says:
Well globally I cant see collective governments backtracking anytime soon. Do you see this happening anytime soon?
The only time they (collective governments) can make such a radical change in position is when the banking ponzi falls apart again.
happy mondays says:
@ hpwatcher – thanks for pointing that out, my just head fell off !
techieman says:
This extrapolation of prior trends is a bit of a waste of time really. Take a look at all of the pundits views before the top and they were doing exactly the same then. Now pinpointing a market turn is difficult but i’d take any of these with estimates with a pinch of salt.
Will they be right – possibly …. but if so its based on extrapolating current developments into the future. That dont always work – either on the upside or downside.
righttoleech says:
Where there is no brain a straight line graph will do.