A question for the optimists

michaels

Answering Graham and Mewbie
I think 2 factors drive demand for houses are affordability and expectations.

Average mortgage rates are down since 2007 so affordability is better

People are no longer predicting a financial meltdown which would obviously result in mortgage lending becoming unavailable and falling house prices. The expectation of falling prices is obviouly self-fulfilling (classic deflationary spiral) as is the reverse (the 'got to buy now as it will be unaffordable later' mindset)

Thus things have changed since 2007/8

Dan:_4

Asrulous wrote: »

Sorry my post offended you - I was merely supporting the point made by others such as SteveJ and Ukcarper.

Actually, I'd say my situation was comfortable, not smug.

Hi and welcome.

You will find many posters get quite jealous about someone doing well.

Generali

Asrulous wrote: »

Sorry my post offended you - I was merely supporting the point made by others such as SteveJ and Ukcarper.

Actually, I'd say my situation was comfortable, not smug.

Your post didn't offend me and on a second reading I was a little aggressive and I apologise for that.

Welcome to the board (if you've never posted before).

It's late here in Aus so g'night Asrulous and everyone else too.

Asrulous

Dan: wrote: »

Hi and welcome.

You will find many posters get quite jealous about someone doing well.

Sad but true Dan, that's life I'm afriad.

Asrulous

Generali wrote: »

Your post didn't offend me and on a second reading I was a little aggressive and I apologise for that.

Welcome to the board (if you've never posted before).

It's late here in Aus so g'night Asrulous and everyone else too.

Fair enough - apology accepted

LittleMissAspie

ess0two wrote: »

160k average.........some areas of the UK a 3 bed semi can be had for £120k tops.

What kind of salaries do people earn in those places?

Graham_Devon

Ok, so 48 posts, and no one has answered the actual question. This isn't a pop at anyone, I am merely trying to backup my own conclusions that absolutely no one actually knows, or can give a reason as to how the rises in house prices are sustainable.

When I say no one, I mean economists, the press, politicians, us.

All we do have is a set of reasons as to why house prices rising are good, and WHY they are rising.

And we have a set of reasons as to why falling prices are good, and why they were / will fall.

We have absolutely no reason, or explanation of how todays house prices are sustainable, let alone rises in todays prices, bearing in mind the economic background they are set on.

Infact, I nicked this question from a comment I saw in a press comments section. The poster who asked that question was merely told they were wrong, not why, he asked the question again, and it just turned into directing questions at him as to why it couldnt be sustainable.

michaels

Makes me glad I took the time to make post 43...

Graham_Devon wrote: »

Ok, so 48 posts, and no one has answered the actual question. This isn't a pop at anyone, I am merely trying to backup my own conclusions that absolutely no one actually knows, or can give a reason as to how the rises in house prices are sustainable.

When I say no one, I mean economists, the press, politicians, us.

All we do have is a set of reasons as to why house prices rising are good, and WHY they are rising.

And we have a set of reasons as to why falling prices are good, and why they were / will fall.

We have absolutely no reason, or explanation of how todays house prices are sustainable, let alone rises in todays prices, bearing in mind the economic background they are set on.

Infact, I nicked this question from a comment I saw in a press comments section. The poster who asked that question was merely told they were wrong, not why, he asked the question again, and it just turned into directing questions at him as to why it couldnt be sustainable.

Graham_Devon

michaels wrote: »

Makes me glad I took the time to make post 43...

Sorry michaels.

I did see you post, and thanks for that, but I was looking for the sustainability question, not why people were buying, but how these rises etc are sustainable.

HammersFan

In answer to the OP, lending money is a profitable business in the long term. Banks will always have to lend in order to make money. They are doing pretty well out of the mortgage market right now with big margins. I doubt we will se a return to the nutty price rises of recent years, but an averge of 5% ish while interest rates are this low is not out of the question. When interest rates go up, people tend to have more money to spend.

Your question is a bit of a flase one too - sustainable - over what period? The property market has up and down like any other market, over the medium to long term its only going to go up.