Cameron: House Prices Will "Continue To Rise"

the_flying_pig

nembot wrote: »

He's not a troll, just a man with a passion for what he believes in - some would say too much passion.

This wouldn't be an issue, if he didn't slag everyone off at the same time.

his 'arguments' are very one-sided, and veer from the merely repetitive to the downright nonsensical, but i'd say that his online manners are pretty good?

IveSeenTheLight

the_flying_pig wrote: »

millions of people almost certainly will downsize eventually, but unless the millions of properties that they sell are going to be bought by non-existent people, any house price inflation or deflation in the period leading up to said sales will create exactly as many winners as it does losers.

I understand that for every seller there must be a buyer.
In your eyes this seems to be every winner (seller) there must be a loser (buyer) with regards to higher selling / buying prices.

But would that "loser" not in time become a "winner"

Everybody wins

IveSeenTheLight

the_flying_pig wrote: »

his 'arguments' are very one-sided, and veer from the merely repetitive to the downright nonsensical, but i'd say that his online manners are pretty good?

Indeed, generally, his posts contain links to the facts he is discussing and are therefore open to review and dicussion.

You could argue that many of his posts benefit from historical evidence, actual fact based, while the opposite side of the fence is reliant upon speculation and hope.

Harry_Powell

Asheron wrote: »

House prices are going down 40% not up

LOL!! Absolutely brilliant! :rotfl::rotfl::rotfl::rotfl:

IveSeenTheLight

Asheron wrote: »

House prices are going down 40% not up

Harry_Powell wrote: »

LOL!! Absolutely brilliant! :rotfl::rotfl::rotfl::rotfl:

Indeed, to remind people of the linked article and the words our Prime Minister used: -

http://www.telegraph.co.uk/news/newstopics/politics/david-cameron/7751610/David-Cameron-vows-to-cut-taxes.html

As the economy recovers and as house prices continue to rise you will find people getting caught by the inheritance net that should not be there.

mr_fishbulb

HAMISH_MCTAVISH wrote: »

Houses are merely an asset class like any other. Sure, they have utility value, like many other assets, but there is nothing special about housing.

Except people have to live in them.

Fair enough their prices behave like standard asset classes (being driven buy supply and demand), but there is no way someone can remove themselves from the effect of those prices - everybody has to live somewhere, be it renting or owning.

For example, if I didn't care about precious metals as an asset, I could stick Asheron on my ignore list and go about my life without it affecting me.

The difficulty with treating houses as just another asset class is you dehumanize them and think only of making a personal return, rather than people living in overcrowded conditions or being forced out of their homes because they cannot afford them

IveSeenTheLight

mr_fishbulb wrote: »

Except people have to live in them.

Fair enough their prices behave like standard asset classes (being driven buy supply and demand), but there is no way someone can remove themselves from the effect of those prices - everybody has to live somewhere, be it renting or owning.

For example, if I didn't care about precious metals as an asset, I could stick Asheron on my ignore list and go about my life without it affecting me.

The difficulty with treating houses as just another asset class is you dehumanize them and think only of making a personal return, rather than people living in overcrowded conditions or being forced out of their homes because they cannot afford them

The issue regarding living conditions / crowding etc is it seems we have forgotten how people lived in the UK in the past and are certainly ignorant on the conditions that people live throughout the world.

I've seen at close hand how people live in South East Asia, where families are more reliant on each other often having 3 or 4 generations under the onw roof.

It's wasn't that long ago that there was similar in the UK

the_flying_pig

IveSeenTheLight wrote: »

I understand that for every seller there must be a buyer.
In your eyes this seems to be every winner (seller) there must be a loser (buyer) with regards to higher selling / buying prices.

But would that "loser" not in time become a "winner"

Everybody wins

Errrr...
OK, let's use an example... let's say that a chap who was 35 yrs old in 1980 (so born in 1945) bought himself a house for £25k. He sells it, aged 65, in 2010 to another chap 30 years younger than himself (so born in 1975), and moves into a rented flat in a retirement type village.

If there has been no house price inflation whatsoever during that time, how much money changes hands? £25k, giving the retiree [on top of his pension plan] £25k cash to spend on his retirement and saddling the 35 year old with [assuming no deposit] a £25k mortgage.

If house price inflation means that the price has actually increased to £175k, how much money changes hands? £175k, giving the retiree [on top of his pension plan] £175k cash to spend on his retirement and saddling the 35 year old with [assuming no deposit] a £175k mortgage. The retiree is now £150k better off than he would have been without the inflation. How much worse off is the 35 year old because of the inflation? Yes you guessed it, £150k.

You've suggested that further house price inflation in the years 2010 to 2040 will compensate the 30 year old for the extra £150k of debt, but surely it's obvious that for this to happen someone else (say born in 2015) is going to be saddled with debt that they wouldn't otherwise have incurred.



I very sincerely hope that everyone understands this deep down.

chucky

the_flying_pig wrote: »

I very sincerely hope that everyone understands this deep down.

a decent point.

how things will pan out imo is that the next stage will be stagnation (no idea how long, maybe 5 years) that follows the 10 years of prices rises to 2007 and the 1 year of price drops.

this stagnation period doesn't mean more people will be able to buy property but it will mean that far less people will be able to afford to buy due to a number of factors - higher taxation, inflation or maybe even supply.

IveSeenTheLight

the_flying_pig wrote: »

I very sincerely hope that everyone understands this deep down.

I think we do.
It's called a fact of life. Life moves on and people get on with it.

I recall a post earlier about someone who bought a house for £2,000 and sold it later for £10,000.
It was then sold again for somthing like £40k and again at £155k.

Do you believe that house should always have been sold at £2,000?

Inflation happens to all things.
How much is a loaf of bread or a pint of milk nowadays compared to historically?
Are car prices dearer or cheaper than in the past?