The bear case

HAMISH_MCTAVISH

Jojo1daffy wrote: »

I still don't get what bears and bulls are....

People who are bullish on a market expect it to rise.

People who are bearish on a market expect it to fall.

However on housing forums those terms have been corrupted to mean bulls want prices to rise, and bears want prices to fall.

System

"The bear case"? Non-existant for about 12 months now.

brit1234

Joeskeppi wrote: »

"The bear case"? Non-existant for about 12 months now.

9-10 months, you forgot about the recent months of house price falls

chucky

brit1234 wrote: »

9-10 months, you forgot about the recent months of house price falls

this is brilliant - a UK average house price drops 0.5% or 0.4% even 0,1% over a few montths and people get excited.

quality frothing :T

macaque_2

HAMISH_MCTAVISH

The average house price is around £168K.

I stand by my earlier statement.
http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/houses.stm

The average salary of actual house buyers (as opposed to all people) is more like £42K.

And why do you think that the salary of actual house buyers is £42k? That proves my point.

Companies move into and out of the UK all the time, and the cost of housing has almost nothing to do with it.

Wrong! Over the past two years, almost all the big high value chemical companies have announed plant shutdowns in the UK. There are no new chemical companies setting up in the UK.

Corporate tax regimes and income tax rates are the culprit with that one. But lets examine this line of thought further..... If the bear case was correct, then the areas with the lowest housing costs should be absolute magnets for corporations and business people.

Not true. The cost of doing buisness is a major factor in influencing company location. Accomodation costs are now comparable to a 40% tax on employees under the age of 40. Most young people are forced to rent and the few who can afford to buy are faced with the risk of large capital losses.

After all, if companies are willing to move to Europe, or even further afield, in search of cheaper costs for their employees, then they should certainly be willing to move a couple of hundred miles within the UK. And yet we see that the opposite is consistently the case.

Relocating to areas with skills shortages and poor transport links is not a solution.

The North of England has many areas where houses can be bought for 30K to 50K. And yet the exodus of business from these areas has been dramatic and overwhelming, and the unemployment in those areas has skyrocketed.

These are not cheap places to do business. In these areas, the public sector are offering salaries and conditions that private companies cannot hope to compete with.

Suffice it to say that whilst some of those things certainly help with HPI, it's not true that the government has done those things in an almighty secret conspiracy to create HPI.

It is not so much a conspiracy as naked manipulation. Why did the Labour government exclude house prices in the inflation target?

House prices are where they are because of supply and demand, it is that simple and there is nothing else.

For supply read cheap money and for demand read mass immigration. Neither are sustainable.

Population is growing by 400,000 people a year, new households are being formed at the rate of 250,000 a year. And we are building around 100,000 houses a year.

You use this figure as though it was a law. The 400,000 population growth is due to net inward migration. Immigrants have been getting a free ride on our health system, schools and housing. How long do you think it can last after political motives change or economic discomfort prevails.

The country is growing at the fastest pace on record. An extra million people in the last 3 years alone. And housebuilding is at the lowest level since 1924.

That is not true and you cannot drive using the rear view mirrors alone.

Exocet

chucky wrote: »

this is brilliant - a UK average house price drops 0.5% or 0.4% even 0,1% over a few montths and people get excited.

quality frothing :T

This is even better. A poster gets excited over other posters excitement... can't wait for the next (8,885) instalments.

chucky

Exocet wrote: »

This is even better. A poster gets excited over other posters excitement... can't wait for the next (8,885) instalments.

i wouldn't say it's better unless you're easily excited... there's definitely no excitement here - more like pity for them

Exocet

chucky wrote: »

i wouldn't say it's better unless you're easily excited... there's definitely no excitement here - more like pity for them

I think the more indebted one is, the frothier one gets.

chucky

Exocet wrote: »

I think the more indebted one is, the frothier one gets.

no idea - not indebted enough to froth even if that were possible?!

but anyway it's good to here that you have a built in frothometer

Exocet

chucky wrote: »

no idea - not indebted enough to froth even if that were possible?!

but anyway it's good to here that you have a built in frothometer

Indeed I do. But one's man post is another man's froth - therefore they cancel each other out. In the end - what will be will be.