Could UK house prices follow Japan?

the_ash_and_the_oak

HAMISH_MCTAVISH wrote: »

Oh dear, better not tell the bears that, their poor little heads might explode.

might have a point here - pointing out that wages and prices are back in line with where they were around the top of last bubble has certainly sobered me a little

IveSeenTheLight

Cannon_Fodder wrote: »

Strange, I don't see you guys conceding that the last trough was 1997, when Hamish or someone else says the 90s crash was a mere 18 months....?!

It's plainly obvious when you see the graphs for the UK on average.

Why pick a point in time when house prices were below the long term trend?

Pssst

mewbie wrote: »

Interesting set of figures - for those who find such things interesting of course.


http://blogs.thisismoney.co.uk/this_is_money_blog/2009/09/why-britains-house-price-crash-is-far-from-finished.html

Could UK prices follow those in Ulan Bator..the next pot of gold for UK holiday home/expat investors....
http://www.timesonline.co.uk/tol/news/uk/article1813864.ece

chucky

IveSeenTheLight wrote: »

It's plainly obvious when you see the graphs for the UK on average.

Why pick a point in time when house prices were below the long term trend?

maybe not his agenda?

Cannon_Fodder wrote: »

Strange, I don't see you guys conceding that the last trough was 1997, when Hamish or someone else says the 90s crash was a mere 18 months....?!

they fell for approximately 18 months and stagnated at virtually the same amount (+3% or -3£) for 5 years... :rolleyes:

kennyboy66_2

the_ash_and_the_oak wrote: »

might have a point here - pointing out that wages and prices are back in line with where they were around the top of last bubble has certainly sobered me a little

Lets try Apr 1986 to Apr 2009 then.

Earnings up 263%, house prices up by 294%

As it happens, I reckon house prices will fall, and it wouldn't be a bad thing.

However those hoping for 70% (or 50%) falls surely can't take much comfort from history.

the_ash_and_the_oak

can't disagree here. not hoping for 50% falls imo

IveSeenTheLight

the_ash_and_the_oak wrote: »

can't disagree here. not hoping for 50% falls imo

The thing is we are only just above the long term trend for house prices.
Should house prices not follow the trend rather than sway so much above and below the trend line?

Even the people at housepricecrash.co.uk are showing this on their graphs

http://www.housepricecrash.co.uk/graphs-average-house-price.php

the_ash_and_the_oak

I know where you are coming from with the trend line but imo there's a reason in cyclical markets why it goes above and below that line - and that is that both the above and the below periods 'distort' the trend line (in a way I read it a bit like the way that prices may be y-on-y down but rising - or y-on-y up but falling)

StevieJ

IveSeenTheLight wrote: »

The thing is we are only just above the long term trend for house prices.
Should house prices not follow the trend rather than sway so much above and below the trend line?

Even the people at housepricecrash.co.uk are showing this on their graphs

http://www.housepricecrash.co.uk/graphs-average-house-price.php

Then again if that graph was adjusted for average net mortgage rates it would paint a different picture again.

the_ash_and_the_oak

the_ash_and_the_oak wrote: »

Not really feeling this tbh - kinda disingeneous. it always undershoots, and it doesn't just always undershoot without reason.

exaggerated example

yr price longtermtrend
1 10 10
2 20 15
3 30 20
4 60 30
5 60 36
6 60 40
7 70 44
8 90 50
9 400 80
10 600 140
11 110 137
12 120 136

a) in year 11 the price is undervalued against the long term trend
b) in year 12 prices rose by almost 10% yet long term trend fell

tbf you argued against this saying that it had actually corrected at that point and would then any further correction is an over-correction. Could just be semantics or actual disagreement here but the above is my stance re:trend lines