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Debate House Prices
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FT: House prices to start rising steadily as soon as October
Comments
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Lets not forget in the last recession rates were not as low for as long as this.0
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Four million homeowners in the UK are playing a waiting game with the property market, watching for the best moment to trade up and cash in on cheaper home-ownership before prices start to rise.
According to research from First Direct, these homeowners are now sitting on a savings pot of £20.2bn which is ready to be ploughed into the housing market when the time is right.
The survey found that with the property market already showing small signs of recovery, the average Brit expects house prices to start rising steadily as soon as October 2010.
http://www.ftadviser.com/FTAdviser/Mortgages/News/article/20090416/3532d7f4-29d6-11de-8da9-00144f2af8e8/House-prices-to-start-rising-steadily-as-soon-as-October.jsp
Not seen anyone else do the sums here so I thought I better jump in:
4m homeowners
£20bn
=£5k each.
I guess that's 10k a couple, but it's still not exactly going to set the world on fire.
Correct me if I got the sums wrong, but I'm quite good at very basic maths.
Then we have a bit more blurb about 15% of people thinking that house prices will start to rise in October - what options were they given? Monthly, quarterly, annualy, this year, next year, sometime, never? Or were they given 6 or 7 options of which 15% chose each, perhaps there was 5 options with 6, 12, 18, 24 & 36 months with a split of 15,20,30,20,15. Basically the whole article is a "re-hash" of a one-sided press-release by First Direct. They "author" even left in the advert at the end for offset mortgages, which, I believe, first direct specialise in.
I think even, re-hash is a little to strong a word, it would be wonderful to see a comparison between the release from first direct & the article. I can't believe people get paid for this sort of unquestioning !!!! - just cut out the middle man & publish press releases whatever the company wants you to.
Sorry got a bit ranty at the end there.
"Mrs. Pench, you've won the car contest, would you like a triumph spitfire or 3000 in cash?" He smiled.
Mrs. Pench took the money. "What will you do with it all? Not that it's any of my business," he giggled.
"I think I'll become an alcoholic," said Betty.0 -
Four million homeowners in the UK are playing a waiting game with the property market, watching for the best moment to trade up and cash in on cheaper home-ownership before prices start to rise.
According to research from First Direct, these homeowners are now sitting on a savings pot of £20.2bn which is ready to be ploughed into the housing market when the time is right.
The survey found that with the property market already showing small signs of recovery, the average Brit expects house prices to start rising steadily as soon as October 2010.
http://www.ftadviser.com/FTAdviser/Mortgages/News/article/20090416/3532d7f4-29d6-11de-8da9-00144f2af8e8/House-prices-to-start-rising-steadily-as-soon-as-October.jsp
Dan, a point to make is that this means little in reality. I am very much part of that statistic sitting on a hefty wad of cash, debt free and ready to buy. Does it mean i am going to do so any time soon? Does it heck.0 -
Thrugelmir wrote: »In the back of my mind. I seem to recall that interest rates were cut in the 80's as well though levels of taxation did rise. Correct me if I'm wrong.
It depends at which point in the 80s you're talking about really.
Interest rates were very high in the early 80s to reduce inflation. Income taxes fell quickly but other taxes (especially consumption taxes) rose considerably.
Broadly speaking, interest rates and taxes fell in the mid-late 80s (and some Govt borrowing repaid) before the Lawson Boom came to a pretty catestrophic end amid the ERM FUBAR.
The early-mid 80s stuff was a result of Labour and Tories following crazy leftist policies in the previous couple of decades - a union sounds off so you throw them a bone, an industry is doing badly so you nationalise the whole thing. It was a mess to unwind it and it will be even worse if the whole world follows the same policies (as they seem to be doing right now).0 -
Hmmm, that seems a bit big.
No reliance should be placed on the above! Absolutely none, do you hear?0 -
Try this version:
No reliance should be placed on the above! Absolutely none, do you hear?0 -
Try this version:
Now (IMO) that is really interesting - that really flattens out the oft-quoted real house price graph whilst still showing an enormous bubble at the near end - It shows the late-80s bubble for what it was, short lived and inconsequential for those who hadn't been caught up in the (understantdable) mania.
Thank you.
Is there a graph that can account for changes in terms of trade over the past 10 years that kept retail prices low so show deflation in retailed goods but inflation in assets. TBH, I don't really know how this could be graphed in 2D easily and I think that's getting into maths I can't do for myself.0 -
If you have the time series, I can graph it. ^.^
BTW, all the borrowed money flowed into the country, keeping Sterling very high. Since that inflow has lessened, Sterling has collapsed.No reliance should be placed on the above! Absolutely none, do you hear?0 -
If you have the time series, I can graph it. ^.^
BTW, all the borrowed money flowed into the country, keeping Sterling very high. Since that inflow has lessened, Sterling has collapsed.
Improves the terms of trade for those selling hi-tek engineering (which the UK is very good at). Worsens it for food and (to a lesser extent) fuel importers.
That looks like an accidental Green revolution. No doubt Brown will try to take the credit.0
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