Demographia 2009: It IS a supply shortage after all.....

carolt

HAMISH_MCTAVISH wrote: »

Now you're getting into the third aspect of things. Need, desire, demand.

You need a place to live. You desire to live there alone. You can only convert need and desire into demand when you obtain financing.



No, the shortage of supply will raise the rents. The fact that the shortage of supply will also force people to live together just means they can afford to pay higher rents.

And rent being cheaper than a mortgage is not a universal phenomenan. In many places, it's the same or more expensive. Yet these people manage to save deposits regardless.


You may as well have saved some time and said "but, I don't understand it, so I'll try and slag off Hamish and add to my thanks count from rewired, carol and mewbies latest persona instead.":rolleyes:

Or you could totally needlessly slag off rewired, me and mewbie, none of whom have even read let alone contributed to this thread? (And 2 of who are never going to, given 1 is PPRed and the other never posts.)

Ooh, what a brave keyboard warrior you are.

I just turned to this thread out of idle curiosity as to whether you could really still be desperately posting house-price mania fodder at this time of night on a Friday.

I find that not only you doing that, but you're actually finding time to slag off absent posters, too.

What a man.

Have you thought of joining the girls' thread, on make-up (where I've been).

It's a damn sight more interesting than this one, I can tell you.

Night, night, Hamish.

Don't stay up all night. Those bags won't be pretty in the morning.

HAMISH_MCTAVISH

Mr.Brown wrote: »

I love this association with your veneered Mewbie.

Some people said Mewbie came across as a bit fake, like there was an artificial layer on top. Some of his posts were a bit inflexible, almost wooden really, but I don't think he was veneered.

Although I'm pretty sure he may have been venerated by a certain clique.;)

carolt

Oh go to bed, Hamish. No-one cares.

HAMISH_MCTAVISH

carolt wrote: »

Have you thought of joining the girls' thread, on make-up (where I've been)..........

......Those bags won't be pretty in the morning.

They never are, carol..... they never are.;)

michaels

Hamish, don't want to !!!! on your parade and actually I buy your arguement...but it entirely fails to explain the 20% price fall seen between Sept 2007 and Feb this year - unless their was a sudden increase in supply that I missed.

The only problem in fact is that you have ignored the impact of expectations - part of the reason that prices move in trends rather than as noise is that their is an expectation - did demand and supply of oil push up prices from 40 to 150 usd / barell and back down again? Or how about gold? And the credit crunch did for house prices not by slashing affordability but via expectations, suddenly a buy now before prices rise scenario became a hold off and get it cheaper situation.

ThrowingStonesAtYou

michaels wrote: »

The only problem in fact is that you have ignored the impact of expectations

He's also ignored the fact that when the economy is not being run by escaped lunatics, the vast majority can't really afford to borrow £200k, but let's not worry about that.

carolt

michaels wrote: »

Hamish, don't want to !!!! on your parade and actually I buy your arguement...but it entirely fails to explain the 20% price fall seen between Sept 2007 and Feb this year - unless their was a sudden increase in supply that I missed.

The only problem in fact is that you have ignored the impact of expectations - part of the reason that prices move in trends rather than as noise is that their is an expectation - did demand and supply of oil push up prices from 40 to 150 usd / barell and back down again? Or how about gold? And the credit crunch did for house prices not by slashing affordability but via expectations, suddenly a buy now before prices rise scenario became a hold off and get it cheaper situation.

Don't spoil his party. All the bears are in bed so he's got a clear field.

Generali

michaels wrote: »

Hamish, don't want to !!!! on your parade and actually I buy your arguement...but it entirely fails to explain the 20% price fall seen between Sept 2007 and Feb this year - unless their was a sudden increase in supply that I missed.

The only problem in fact is that you have ignored the impact of expectations - part of the reason that prices move in trends rather than as noise is that their is an expectation - did demand and supply of oil push up prices from 40 to 150 usd / barell and back down again? Or how about gold? And the credit crunch did for house prices not by slashing affordability but via expectations, suddenly a buy now before prices rise scenario became a hold off and get it cheaper situation.

It is supply and demand. That's all there is to set prices.

My belief is that demand fell as availability of mortgage funds dried up. Subsequently supply has fallen too so prices have risen.

Arcaine

The thing is that once prices started rising, banks lent on the back of increasing asset prices, so the money supply into the market certainly fuelled the rise in prices. Supply/demand and money supply all played their part in the increases in house prices we have seen. I am sure economists will be arguing for years which order it all came in, it is all a little chicken and egg.

baileysbattlebus

Graham_Devon wrote: »

Yes.

Your problem came when you used flatmates (I know you didnt say flatmates, but this is the easiest term) as the people who would club together to buy a house and calling this household income to back up the point you were trying to make.

Any flatmates in their right mind would not enter into a 25 year mortgage term with upwards of 2 people. And I think you are well aware of that but have come a little unstuck now.

It could even be multigenerational living Graham - I know a couple of people who do this - next door to us is one family - they had 4 kids and and a 3 bed house - the kids are 3 girls and 1 boy - so the girls all shared a room - nothing wrong with that - but woman's mother also had a house and lived on her own. They couldn't afford a bigger house.

Their solution was to sell both both houses and buy the one next to us - 4 beds but downstairs has a large extension which they made into a bedroom and a living room put in a bathroom and small kitchen - problems solved. They got the house they wanted and the mother had her own self contained little place. Our neighbours took out a mortgage in all 3 names, which they paid (not the mother) and all 3 names on the deeds.

A family across the road do the same, they sold 2 houses and bought a bigger one - the mother also has downstairs living accommodation.

This type of living is quite common in the Mediterranean countries - who knows it could become more common here.

In the housing boom of the 1980's I knew several people who bought property together - and they were only work colleagues - it was the only way they could afford a house - it was quite common in London for 2, 3 or 4 people to buy together. It's not unheard of.