"House price crash predictions are premature"

Sisyphus

Generali wrote: »

True but since when that stop someone?

Dot com boom - some terrible investments to be made and a lot of punters made them.

...

quite, the rest is history. So less people buying property out of necessity leads to what?

ReportInvestor

Look at the surge in dating agencies which match "wealthy" clients.

These are people who already have two properties or more and when "matched" they will let out one of the two properties.

ReportInvestor

Sisyphus wrote: »

There comes a point where if rents rise further, the labour force can foxtrot oscar. Today I'm working from my Paris office - I'm using my London computer and telephone lines at distance. As far as my clients can tell I'm in London. I could just as easily be in Frankfurt, Zurich, Madrid or Bratislava.

Meanwhile 100,000s of French are working in England pushing up the rents .

Sisyphus

ReportInvestor wrote: »

Meanwhile 100,000s of French are working in England pushing up the rents .

and we're exporting our old wrinklies to the Dordogne.

I think we're on the better end of that deal

mystic_trev

ReportInvestor wrote: »

There's no negative yield, just a whole host of potential tax benefits .

and what about the IHT?

ReportInvestor

To stick with the main argument:

Many of the old wrinklies will be letting their homes for retirement income.

ReportInvestor

mystic_trev wrote: »

and what about the IHT?

Get a good accountant/lawyer and the right house and you might not pay it.

I personally think that's wrong, but it's helping to drive the market.

Sisyphus

ReportInvestor wrote: »

To stick with the main argument:

Many of the old wrinklies will be letting their homes for retirement income.

that's been the argument all the up to these levels but at these prices there are less risky investments that yield better. The only reasons investors accept such low yields /risk is the perception that the risk is lower than it is and assumption that high HPIs will continue ad infinitum. If these perceptions change, propert as an investment will unwind fast as is happening in US and perhaps now too in Spain.

I'm expecting someone to start arguing that Uk investors are selling up in Spain to buy in UK again.

ReportInvestor

Could be.

Although the UK investor has been traditionally neglectful & foolishly wary of the alternative rising income investment to date, namely income shares.

I'm not actually a house price bull. I'm more interested in the social and political implications of the housing market over the next decade, and its relationship to other investments.

On my general theme of growing inequality, lower numbers of children per family (combined with Gordon's proposed increase in the IHT limit to £350K in 2010) will ensure that the number of private landlords is set to increase, irrespective of any pain caused to prospective first time buyers who aren't lucky enough to benefit from the property wealth trickle down effect.