Margareta Pagano: Dr Doom predicts a housing disaster – and he's got history on his s

homelessskilledworker

http://www.independent.co.uk/news/business/comment/margareta-pagano/margareta-pagano-dr-doom-predicts-a-housing-disaster--and-hes-got-history-on-his-side-8153437.html




Be careful what you wish for. All the chat about higher growth in the US and green shoots in the UK might bring with it just what we don't want; higher interest rates to contain inflation and with them, a crash in UK house prices.

If you talk to Andrew Gibson at Galvan Research and Trading, one of the UK's top contract for difference brokers, as I did yesterday after reading his latest special report – Why UK house prices are set to collapse – you'll discover we may be on the brink of another housing disaster.

Carl31

I was thinking about this the other day, there are signs that things could be on the mend, but our economy is still full of 'props', lowest interest rates in years etc.. its not really growth in a 'usual' climate
As soon as we try to revert back to 'normality', then we are just going to be back in trouble again, well mortgage holders mainly, especially anyone thats bought in since the low IR

JonnyBravo

JonnyBravo wrote: »

:T

And have you noticed this one has stopped using different fonts, which used to be his "trade mark". I guess it just became too much of a hassle to keep the changing the font.

Carl31 wrote: »

I was thinking about this the other day, there are signs that things could be on the mend, but our economy is still full of 'props', lowest interest rates in years etc.. its not really growth in a 'usual' climate
As soon as we try to revert back to 'normality', then we are just going to be back in trouble again, well mortgage holders mainly, especially anyone thats bought in since the low IR

That's better Carl31. Good to see you're feeling yourself again

Generali

Carl31 wrote: »

I was thinking about this the other day, there are signs that things could be on the mend, but our economy is still full of 'props', lowest interest rates in years etc.. its not really growth in a 'usual' climate
As soon as we try to revert back to 'normality', then we are just going to be back in trouble again, well mortgage holders mainly, especially anyone thats bought in since the low IR

Increasingly there are signs that very low interest rates are causing problems in the economy: banks, for example, that generally provide services for free or at least very cheaply off the back of the interest they make on the cash they hold aren't able to do so. (I don't mean current accounts BTW: the interest on the £100 that is held as an average balance won't pay for the toner costs of printing your statements).

Also, a huge discrepancy between savings and lending rates is causing dysfunction in credit markets IMHO: it's not worth saving and it's not worth borrowing.

I'm starting to think that increasing base rates while increasing the amount of QE could be the way forward. It's gotta be worth a shot at least as what is happening at the moment isn't working.

purch

Generali wrote: »

it's not worth saving and it's not worth borrowing

Yes, that in a nutshell appears to be the problem we face.

FTBFun

homelessskilledworker wrote: »

If you talk to Andrew Gibson at Galvan Research and Trading, one of the UK's top contract for difference brokers, as I did yesterday after reading his latest special report – Why UK house prices are set to collapse – you'll discover we may be on the brink of another housing disaster.

http://www.galvan.co.uk/press-room

What special report?

kabayiri

Generali wrote: »

...
it's not worth saving and it's not worth borrowing.
...

At the hospital yesterday, there was an elderly gentleman visitor, who was happy to raise the topic of a Santander ISA he had purchased.

Apparently, it had a basic rate of return supplemented by 0.1% for each major Rory McIlroy proceeded to win!

It seems incentives to save are changing

chewmylegoff

FTBFun wrote: »

http://www.galvan.co.uk/press-room

What special report?

It is so special that you can't see it.

A bit like Galvan's presence in the CFD market.

Gracchus_Babeuf

The doomsayers have been preaching a housing crash for years now - and nothing happened. I suspect the market will remain flat for a long time but I don't see ant prospect of a crash unless unemployment goes through the roof, which I doubt. Interest rates are also set to remain low for years, so the worst that can happen, in my view, is lack of growth.

Gracchus_Babeuf

homelessskilledworker wrote: »

http://www.independent.co.uk/news/business/comment/margareta-pagano/margareta-pagano-dr-doom-predicts-a-housing-disaster--and-hes-got-history-on-his-side-8153437.html




Be careful what you wish for. All the chat about higher growth in the US and green shoots in the UK might bring with it just what we don't want; higher interest rates to contain inflation and with them, a crash in UK house prices.

If you talk to Andrew Gibson at Galvan Research and Trading, one of the UK's top contract for difference brokers, as I did yesterday after reading his latest special report – Why UK house prices are set to collapse – you'll discover we may be on the brink of another housing disaster.

Here is a really daft quote from the article:

"But, to get a more accurate snapshot of the whole country, you have to strip out London, which is still sadly inflated by overseas buyers with their dodgy money, and the South-east, where the average UK house price rose by just a 0.6 per cent in the last year. "

Why do we need to strip out London and the south-east, when these areas are the heartlands of the UK economy and where around a third of the national population live? Nonsense. Prices have been in the doldrums for years 'up north' and frankly this is not news. The real barometer of the nation's economic health is the south-east not the north or Wales or Scotland.