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Debate House Prices
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London house prices rise 8%......
Comments
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HAMISH_MCTAVISH wrote: »What is it with you lot and your constant need to assign morality to housing?
Houses are assets, and like all assets subject to the law of supply and demand.
People don't need shares and bonds to live in....there's a difference between residential property and other real and financial assets. I'm not sure I'd like to live in a society (as presumably you would approve) where housing is treated 'like all assets'.
If what you're claiming was true, that housing is like any other asset, then you wouldn't have rent control laws in capitalist countries like the Netherlands or Italy, including the United States...one of the most laissez-faire economies in the Western world.0 -
HAMISH_MCTAVISH wrote: »Oh, so now you admit there is a shortage of housing....
Well, it's a start. :beer:
What is it with you lot and your constant need to assign morality to housing?
If you mean people with a sense of fairness and thought for others, then yes, "our lot" do assign a certain amount of morality to housing. Food, water, shelter, warmth. All basic human requirements.
Houses are assets, and like all assets subject to the law of supply and demand.
Yes houses are assets, but are now seen as the most important financial asset for a majority of people. I might be a bit old fashioned, but I see my house primarily as a place to live, the value of it is of very little concern to me.
Sure, you can artificially restrain house prices for a while with mortgage rationing, but such tinkering can only ever be a short term effect, and it's having little impact anyway.
You can also artificially boost house prices with a mixture of loose lending, property !!!!!!, and a relaxed approach to multiple ownership.
Mortgage lending is just one third what it was at peak, and house prices are still 90% of what they were at peak on average, and at a new peak in some places. And in the meantime, rents have soared to a new peak instead, because ultimately, there is still a massive shortage of housing in this country.
Which, as I say, is bad news for many who are on the wrong end of the property shortage.
At some point in the next few years, enough people will have saved a deposit, rental returns will attract an influx of capital, and mortgage lending will increase.
To compete for an insufficient number of properties.
It doesn't take a rocket scientist to figure out what happens then... Prices soar.
Bad news for those who might not have the means to pay those soaring prices. Bad news.
Which is neither good nor bad... Just inevitable.
Good if you are one of your lot, obsessed by rising house prices.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
People don't need shares and bonds to live in....
People need shelter, but they don't need to own a house.
There is no right to owning a property, and never has been.there's a difference between residential property and other real and financial assets.
No, there isn't.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »People need shelter, but they don't need to own a house.
There is no right to owning a property, and never has been.
You don't necessarily have to be a prospective property owner to be affected by rising house prices, unless your landlord is prepared to accept a lower rental yield.HAMISH_MCTAVISH wrote: »No, there isn't.
You don't accept that there's a difference created by the fact that people live in residential property and don't live in bank accounts, shares, patents, gold bars...etc?0 -
You don't necessarily have to be a prospective property owner to be affected by rising house prices, unless your landlord is prepared to accept a lower rental yield.
Which is of no relevance to the fact that nobody has the right to own or rent a house more cheaply than the market rate, and the market rate will ultimately be set by supply and demand.
Society may choose to provide collective insurance to provide housing for those who cannot afford it (benefits), but that's not the same as an entitlement to cheap housing.You don't accept that there's a difference created by the fact that people live in residential property and don't live in bank accounts, shares, patents, gold bars...etc?
No, there is no difference.
Humans need shelter to survive, but there is no right to own a 3 bed semi. It can be a rental, a rented room, or a tent or caravan for that matter.
You need water to live, yet some companies sell water for more than petrol. You need food to live, yet the price of food is set by supply and demand on the global markets.
Wheat, sugar, corn, pork bellies, all commodities subject to speculation, yet all key food components essential to life.
Just because an item has utility value, does not exempt it from the fundamental laws of economics.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »Just because an item has utility value, does not exempt it from the fundamental laws of economics.
I wasn't disputing that. I was arguing against the idea that we shouldn't "assign morality to housing" vis-à-vis other assets.0 -
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You don't necessarily have to be a prospective property owner to be affected by rising house prices, unless your landlord is prepared to accept a lower rental yield?
That is what happened: as house prices rose, yields fell. I lived in a flat in Central London paying, from memory, £245/wk. The place was worth the best part of £400,000. I make that a gross yield of 3.2%. Then it was in the Barbican so the service charges are very high (£20,000 a year for 2 years out of 20 on a type 21 or 22 flat when they replace the lifts), then there's repairs and the idiot rental agent wouldnt be free either.
HPI probably made the deal worth it for them at the time, just about at least FWIW, not that I cared or it was my problem come to that.
My LL was doing me a favour really as I was renting a place that was very convenient for roughly the same money as owning in the suburbs once you take travel costs into account.0
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