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Debate House Prices
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Can anyone explain....
Comments
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Graham_Devon wrote: »Then please.
Do shutup about mortgage famines, mortgage rationing etc etc etc
Was there a part of "components of demand" you didn't understand the first time I said it?“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 -
go easy on him Hamish. it's not your fault that Devon is slow and doesn't grasp things quickly or at all even...HAMISH_MCTAVISH wrote: »Was there a part of "components of demand" you didn't understand the first time I said it?0 -
Today was the first day I actually felt sorry for Hamish. He simply doesnt understand the basics and keeps arguing his case.
Chill out (mate) and realise that maybe, you are wrong, just like I am sometimes wrong too.0 -
Today was the first day I actually felt sorry for Hamish. He simply doesnt understand the basics and keeps arguing his case.I see that ignorance remains your forte.
The constant bashing of Hamish on here gets tiresome. What exactly annoys you so much? He's clearly an intelligent chap who likes to debate. He's a bit cocksure for my liking and I don't agree with him all the time, but he's always happy to discuss and argue. Seems a perfect type for a discussion forum. And if there is anyone who understands the basics I would say it's him, he just has a difference of opinion to most as to what those basics means for the future. But anyway, back to the topic...HAMISH_MCTAVISH wrote: »There is nothing else.
Supply and demand is THE ONLY driver of UK house prices.
I agree Hamish, but I find this rather simplistic, especially in relation to the initial question asked, which was "why have house prices doubled over the past few years?". Not, why do house prices rise and fall, but specifically why they have doubled.
If you'll allow me to use a clumsy analogy, let's take a football club who have 30,000 seats. Over the past 50 years of their history they've averaged around 25,000 a game and £20 a ticket. Sometimes they sell out, but most of the time the ground is mostly full. Suddenly, ten years ago, demand for tickets drastically increased. The ground is a sell out every single game and they get requests for between 50,000 and 60,000 tickets each time, and this has been the case for ten years. They now sell tickets for £40 each, or up to ten times this on the external market. A legitimate and interesting question might be, why has demand doubled over the last ten years and why have prices risen so much?
In the world of Hamish, apparently, there is no debate. It's supply and demand, and that's the only thing. Sure, there are 'enablers' for demand, but these aren't important, as supply and demand is the ONLY factor here. More people want tickets than there are tickets available, hence demand goes up and ticket prices go up. Simple.
But does this answer the question? Obviously I completely agree with you that supply and demand is the main issue at play here: there are more people who want tickets than there are tickets available, so ticket prices rise and so does demand. This is because supply is restricted. So is the case closed? Well, not really. Two decades ago the football club wasn't selling out, so why not? Why is it selling out now? What external factors have changed in the last ten years? That's more the interesting question and, I think, the question Shupufski was asking around houses. In terms of the footie club it could be a number of things:- They've become fashionable (Arsenal)
- They've been promoted (Blackpool)
- They've become massive in Asia (Man U)
- They've signed much better players (Liverpool)
- Wages have gone up in the area (Leeds)
- The area has attracted yuppie types (West Ham)
So I think we agree, it's supply and demand that influence house prices. But so what? Once we've all agreed that, don't we then need to look at the factors that influence supply and demand? As that's the interesting aspect to all this.
Sorry to sound frustrated Hamish, but you're clearly a clever chap and it would be nice to see you use your property shaped brain to actually debate and read between the lines rather than just using it to shout "SHUT UP, SHUT UP, I'M RIGHT, I'M RIGHT, YOU'RE WRONG, YOU'RE WRONG, BEAR MEME, BEAR MEME..."
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So I think we agree, it's supply and demand that influence house prices. But so what? Once we've all agreed that, don't we then need to look at the factors that influence supply and demand? As that's the interesting aspect to all this.
What's interesting about it?
The facts are indisputable.
Population grew, the number of households grew, we didn't build enough houses.
At the same time an expansion of credit, reduction of interest rates, increase of household income and wage increases higher than general inflation resulted in an increased amount of money that could be allocated to housing.
Enabling growth in prices.to actually debate and read between the lines
There's no reading between the lines with this one. It's another tedious hpc troll, regurgitating the same old tired and discredited hpc nonsense.“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 -
Well said Cleaver.
It isn't just "supply and demand", there is more to it than that. The availability and cost of credit will have a bearing on property prices.
There may be a surplus of properties available, but if you repeatedly tell people that property is a good investment, and you offer a supply of cheap and easy credit, you create a demand. So in a way, Hamish is right. What you also do is inflate the price, even though the supply exceeds demand. If you keep telling people there is a shortgage of property (be it true or false), you will push up asking prices. So, it's a case of what is controlling what. Are house prices where they are purely because of supply and demand ie there is a shortgage of property and people are literally outbidding each other to buy properties, or are there other factors at play ?30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
It isn't just "supply and demand", there is more to it than that.
There is nothing else.
The things you mention are all components of supply and demand.The availability and cost of credit will have a bearing on property prices.
A component of demand.a surplus of properties available,
Component of Supply.but if you repeatedly tell people that property is a good investment
Component of Demanda supply of cheap and easy credit,
Component of Demand.you create a demand.
Oh look, you do get it.So in a way, Hamish is right.
No, Hamish is completely right.What you also do is inflate the price, even though the supply exceeds demand. If you keep telling people there is a shortgage of property (be it true or false), you will push up asking prices. So, it's a case of what is controlling what.
You're actually close....
But you can't significantly increase selling prices in an open market in the absence of a genuine situation where supply is less than demand.
You can however, create a situation where demand exceeds supply, (when it did not used to) by spurring consumer demand for the product in question. Societal changes, increased credit, property !!!!!!, etc....Are house prices where they are purely because of supply and demand ie there is a shortgage of property and people are literally outbidding each other to buy properties, or are there other factors at play ?
People don't need to "literally outbid each other" for there to be a genuine shortage of property.“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 -
So, is reposession, a component of supply, or a component of demand?0
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Graham_Devon wrote: »So, is reposession, a component of supply, or a component of demand?
I know you're trying to be funny, but the act of repossession itself is neither.
What happens to the house and it's former occupants afterwards will impact both in a slightly different way to a normal sale.
To explain....
If I sell my house, I still need somewhere to live. So I buy another. I am neutral to supply and demand. I increase both by the same amount.
If a house is repossessed and ends up on the market, it increases supply. If the former owners go into bed and breakfast at taxpayer expense, or move in with friends/family, they don't increase demand. Or at least, not immediately. They almost certainly will eventually, but that could be years away. So it usually creates a temporary increase in supply without a corresponding immediate increase in demand.
Death has the same effect.
Housing bears should really be wishing for an outbreak of plague....“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: »I know you're trying to be funny, but the act of repossession itself is neither.
What happens to the house and it's former occupants afterwards will impact both in a slightly different way to a normal sale.
To explain....
If I sell my house, I still need somewhere to live. So I buy another. I am neutral to supply and demand. I increase both by the same amount.
If a house is repossessed and ends up on the market, it increases supply. If the former owners go into bed and breakfast at taxpayer expense, or move in with friends/family, they don't increase demand. Or at least, not immediately. They almost certainly will eventually, but that could be years away. So it usually creates a temporary increase in supply without a corresponding immediate increase in demand.
Death has the same effect.
Housing bears should really be wishing for an outbreak of plague....
Oh sorry, I thought that was all there was.
Now we have an inbetweener.
I do like the inbetweeners though.
What about things like stamp duty? Supply? Demand? Inbetweener? Nothing? Sh*tted all over your parade?0
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