Rightmove down -4.5% in three months

wotsthat

Eellogofusciouhipoppokunu wrote: »

There was a HPI lifebelt during the period when house prices were booming and people were signing themselves into mortgage servitude, while convincing themselves that they were 'rich'. Gaining £30k in HPI post-boom is little reward for paying £170k more for a house than you would pre-boom.

As I said, people are so entrenched in their beliefs that houses are goldmines that their brains can't comprehend the truth and they argue vociferouly against any opposing view.....

I'm struggling to recognise the same reality. £170k is clearly over-egging it for a start and 5 - 6 years have passed - a lot has changed.

Have a think - how many people do you know that treat their homes like goldmines? What does that mean in practice in 2012?

Loughton_Monkey

Eellogofusciouhipoppokunu wrote: »

....As I said, people are so entrenched in their beliefs that houses are goldmines that their brains can't comprehend the truth and they argue vociferouly against any opposing view.....

House are not goldmines. However, houses are:

1. A very long term investment (typically 25 to 50 years).

2. An investment virtually guaranteed to be far cheaper than the alternative of renting.

3. An investment that will almost certainly exceed (or at the very least) match inflation over the longer term.

As such, any variation in prices over as short a period as 4/5 years is "noise". It is incidental to the points above. It doesn't matter to the 'thinking' person. It is the same rubbish as any idiot invested in Microsoft over the last 30 years moaning about a 12% fall in a space of 4 months.

It is a fact of human nature that there are those who basically understand this rather simple scenario, and those that don't. The former will, as usual, thrive, while the latter will, as usual, flounder throughout life and end up wondering why they never had any money.

Thrugelmir

Loughton_Monkey wrote: »

3. An investment that will almost certainly exceed (or at the very least) match inflation over the longer term.

Hasn't based on past 10 years figures. The doubling on house prices in the space of 4 or so years is now a distant memory. As the correction continues.

Loughton_Monkey

Thrugelmir wrote: »

Hasn't based on past 10 years figures. The doubling on house prices in the space of 4 or so years is now a distant memory. As the correction continues.

Understood. Which is why I specifically mention 25/50 years.