Housing Faces prolonged bear market.

HAMISH_MCTAVISH

Emy1501 wrote: »

I'm still happy for you or any other bull to confirm where the real term rises will come from.

Where did they come from last month? Or for the last year for that matter.

Prices rose by 1.9% last month alone. 9% in the last year. Inflation is running at 3% per year or so.

Thats a real terms growth.

Harry_Powell

Emy1501 wrote: »

I think it was pretty obvious what I was getting at but still I notice that for all your posts on the thread you have not provided any comments on why peoples predictions regarding real term prices are wrong. I'm still happy for you or any other bull to confirm where the real term rises will come from.

I refuse to be dragged into a silly "bull" vs "Bear" gang fight. I actually believe, and have said so many times on here, that the use of the terms 'bear' and 'bull' is misused and completely incorrectly used on this site (and HPC where I think it originated from).

NO ONE is born 'bull' or 'bear', it's a temporary state of mind based on your feeling of a particular market over a particular timeframe. It's not a constant state.

One can even feel both bearish and bullish about the same market. i.e. bearish over the short-term and bullish over the long. Can we therefore please stop this West Side Story gangland crap???!!!!

Now that we have settled that, I'll say again (as I did already in this very thread) that I am equally skeptical about EVERYONE'S predictions when they are so specific and over such a long period. I find it laughable to read posts where people state with certainty what will happen over the next decade. It's just ridiculous. These same people couldn't predict the credit crunch, couldn't predict 0.5% BoE rates and couldn't predict QE, all of which has happened in an 18 month period - much shorter than the decade you and others are now predicting over.

Carry on though, it does make me chuckle.

Emy1501

Harry_Powell wrote: »

I refuse to be dragged into a silly "bull" vs "Bear" gang fight. I actually believe, and have said so many times on here, that the use of the terms 'bear' and 'bull' is misused and completely incorrectly used on this site (and HPC where I think it originated from).

NO ONE is born 'bull' or 'bear', it's a temporary state of mind based on your feeling of a particular market over a particular timeframe. It's not a constant state.

One can even feel both bearish and bullish about the same market. i.e. bearish over the short-term and bullish over the long. Can we therefore please stop this West Side Story gangland crap???!!!!

Now that we have settled that, I'll say again (as I did already in this very thread) that I am equally skeptical about EVERYONE'S predictions when they are so specific and over such a long period. I find it laughable to read posts where people state with certainty what will happen over the next decade. It's just ridiculous. These same people couldn't predict the credit crunch, couldn't predict 0.5% BoE rates and couldn't predict QE, all of which has happened in an 18 month period - much shorter than the decade you and others are now predicting over.

Carry on though, it does make me chuckle.

Unless I am mistaken you bought last year and your post suggest that you bought as much as an investment as somewhere to live. You have also said that prices will be more than they are now in 40 years.

So its ok for you to tell us whats going to happen but not anyone else? its alot easier to make long term predictions than short term ones as this like QE etc play out over the long term.

This is a forum where people make predictions and discuss. Most will be wrong and no one will really care in 25 years what someone said 25 years ago. Therefore you can make predictions with reasons to support or ignore the thread.

Also dont be touchy about the bull bear thing.

Harry_Powell

I've not made any predictions on this thread, I have made a factual statement that house prices will be higher in 40 years time. Here are some more factual statements:

1. The Sun is at the centre of our Solar system.
2. The Earth orbits around the Sun.
3. The Moon orbits around the Earth.

You, on the other hand, seek to tell us exactly how things will play over the next decade, with the certainty of a Time Lord.

Emy1501

Harry_Powell wrote: »

I've not made any predictions on this thread, I have made a factual statement that house prices will be higher in 40 years time. Here are some more factual statements:

1. The Sun is at the centre of our Solar system.
2. The Earth orbits around the Sun.
3. The Moon orbits around the Earth.

You, on the other hand, seek to tell us exactly how things will play over the next decade, with the certainty of a Time Lord.

How can you make a factual statement house prices will be higher than now in 40 years when as you say nobody know what will happen in the future. Nobody predicted the near banking collapse etc.

Also I have given an opinion on how I think things will play out. The fact it does not fit into where you would like things to go is not my problem.

I have no doubt 25 years ago people were giving the same facts on Japan as you are now about the UK

Emy1501

HAMISH_MCTAVISH wrote: »

Where did they come from last month? Or for the last year for that matter.

Prices rose by 1.9% last month alone. 9% in the last year. Inflation is running at 3% per year or so.

Thats a real terms growth.

House prices in real terms are no higher than 2004-2005.

Graham_Devon

Harry_Powell wrote: »

It's still my lifetime and rates are still .5%!!!!

Your prediction is only a day old and it's wrong. This doesn't bode well for your predictions that cover the rest of the decade....

Pretty good at starting utterly pointless, point scoring arguments yourself sir

Thrugelmir

CLAPTON wrote: »

we have averaged real wage increases of round 2.5% pa since the second world war; mainly based on innovation and the associated increased productivity.

I see no specific reason for this to slow down or stop whether or not the East can grow at 8% or more.

As for ordinary inflation of 4% ..well that's just a guess but I would see inflation rising due to pressure on natural resources, exchange rate pressures and when the recovery comes from the usual wage inflation pressure.

I'm not sure I understand why you think real interest rates will be 3-5% above wage inflation.. historically that's very high. And even if they were I don't see that that would mean that house prices wouldn't keep broadly in line with wage inflation.
If however we started building a lot more houses and/or limited the population growth then yes maybe house prices would be constrainted.

The increase disposable income in more recent years was created (intially) in the main by the transfer of manufacturing capacity to China ( and the far east). The cost of many mainstream products has fallen signicantly in real terms since the late 80's. Innovation will also start coming from the East. Besides buying up natural resources and commodities. The Chinese are now buying up technology. As the recent acquistion of Volvo shows. Whilst the Uk has many specialist areas of expertise. None are large enough to fill the void of industrial production.

Its not just a question of growth in the Far East. Thats where the money is. Thats where the bulk of funding for Government debt and mortgages will be derived from. In simple terms the interest paid on the debt will be leaving the country. Its not going to be reinvested for the benefit of the UK population.

Wage inflation will remain subdued for many. Labour markets are international in many commercial sectors. There's no automatic right for pay to match inflation. Particularly when we've huge levels of debt to discharge as well.

What we may have witnessed is the break between BOE base and lending rates. As market forces will determine what rate of interest is required by investors to lend. Greece is a good example despite the backing of the EU. With Government bonds commanding twice the yield of German ones.

Harry_Powell

Emy1501 wrote: »

How can you make a factual statement house prices will be higher than now in 40 years when as you say nobody know what will happen in the future. Nobody predicted the near banking collapse etc.

Also I have given an opinion on how I think things will play out. The fact it does not fit into where you would like things to go is not my problem.

I have no doubt 25 years ago people were giving the same facts on Japan as you are now about the UK

I'm not sure what your point is about Japan - are you saying that 25 years ago (in 1985) Japanese people were saying that house prices will be more expensive in 40 years time (in 2025) ? Are they wrong? (only another 15 years to find out!!)

I'm not sure what you're on about now.

Harry_Powell

Graham_Devon wrote: »

Pretty good at starting utterly pointless, point scoring arguments yourself sir

I didn't say you got into 'point scoring' argument. I said that you pretend to be dense in order to get the most simplistic information explained to you at great length so as to disrupt threads and cause anguish to your victims (i.e. the poor sap who patiently tries to explain 1+1=2 to you) while all the time you're laughing down your sleeve at their efforts. While it is amusing the first few times, I have to say that I'm sick and tired of wading through pages and pages of your misdirection and obtuseness in order to try and keep up with the real discussion. OK Graham, we get the joke - ha ha, you like to cause confusion and annoyance, now can you please give us a break?