Vince Cable - Bubble developing now could be more serious than before

Graham_Devon

Home ownership has now become “unaffordable” to people on middle incomes, Vince Cable admitted, as he warned that the bubble developing in the housing market could be more serious than during the last property crash.

Amid growing tension between the Conservatives and Liberal Democrats over rising house prices, the Business Secretary told The Independent: “The fundamental problem is a chronic imbalance between supply and demand. A recovering mortgage market is just fuelling demand again.”

Mr Cable warned: “A family on average income is nowhere near able to afford a house at the average price. Property has become much more unaffordable for people on middle incomes.”

The Lib Dem minister hit back at comments by Kris Hopkins, the Conservative Housing Minister, who told the BBC’s Newsnight programme that rising house prices are a good thing.

Mr Cable said: “I do not agree with Kris Hopkins that rising house prices are a good thing. If you are an owner-occupier who has paid off your mortgage, it is an increase in your paper or real wealth. But if you are a young family trying to get into the housing market and it is unaffordable, it is an extremely bad thing".

Apparently he will be taken seriously, after he was shunned last time around suggesting that the housing market would tumble....just before it, well, tumbled.

George Osborne yesterday too, admitted to the treasu select committee that price rises were a concern. However, he said he was remaining vigilant (I dunno what this new buzzord actually means they are doing...it's a bit like Brown constantly using the word prudence) and that it wasn't the governments job to intervene in the housing market....he instead pointed to the FPC.

http://www.independent.co.uk/news/uk/politics/exclusive-housing-bubble-brewing-as-prices-become-unaffordable-for-middle-earners-says-business-secretary-vince-cable-9236587.html

CLAPTON

Is he the guy that sold those PO shares too cheaply?

Is he the guy that's been in the cabinet for the last 4 years when record low numbers of houses were built?

I don't remember when London house price last 'tumbled' but I'm glad he predicted it OK.

Is he the guy that promised that LibDem would abolish the position of Business Secretary (or it is unfair to remember that)?

Graham_Devon

CLAPTON wrote: »

Is he the guy that sold those PO shares too cheaply?

Is he the guy that's been in the cabinet for the last 4 years when record low numbers of houses were built?

I don't remember when London house price last 'tumbled' but I'm glad he predicted it OK.

Is he the guy that promised that LibDem would abolish the position of Business Secretary (or it is unfair to remember that)?

While I don't agree with everything vince says or does, the point is that it's yet another article about increasing house prices and the dangers.

Secondly, this time it's from a minister. I don't think we've seen that up until now. We have just seen economists warning of the dangers.

CLAPTON

Graham_Devon wrote: »

While I don't agree with everything vince says or does, the point is that it's yet another article about increasing house prices and the dangers.

Secondly, this time it's from a minister. I don't think we've seen that up until now. We have just seen economists warning of the dangers.

we are seeing the early moves in the 2015 election campaign.

Vince believes that there should be no limit to immigration but has done nothing in government to champion reform for the planning regs so we cna actuall provide decent housing for the expanding population

in fact we can expect the LibDems to use their 'green ' credentials to oppose significant building

that doesn't mean one shouldn't be 'concerned' of course

shortchanged_2

Mr Cable warned: “A family on average income is nowhere near able to afford a house at the average price. Property has become much more unaffordable for people on middle incomes.”

But according to many of the rampers on here the average earner shouldn't be able to afford the average house.

ukcarper

shortchanged wrote: »

Mr Cable warned: “A family on average income is nowhere near able to afford a house at the average price. Property has become much more unaffordable for people on middle incomes.”

But according to many of the rampers on here the average earner shouldn't be able to afford the average house.

With only about 60% of people owning homes why should the average earner be able to buy average home surely it's the average earner of the 60% who are able to buy.

CLAPTON

shortchanged wrote: »

Mr Cable warned: “A family on average income is nowhere near able to afford a house at the average price. Property has become much more unaffordable for people on middle incomes.”

But according to many of the rampers on here the average earner shouldn't be able to afford the average house.

one would expect that poorer people would be less able to buy: the rest is simple maths

clearly Mr Cable isn't willing to recognise this

thescouselander

ukcarper wrote: »

With only about 60% of people owning homes why should the average earner be able to buy average home surely it's the average earner of the 60% who are able to buy.

I don't think that's the case because the average owner demographic is dominated by those who bought ages ago at much lower prices. For new entrants to the market it will only by high earners or those who have been subsidised who can afford to buy. Not good when you consider housing is an essential commodity and rents are likely to follow house prices upwards.

ukcarper

thescouselander wrote: »

I don't think that's the case because the average owner demographic is dominated by those who bought ages ago at much lower prices. For new entrants to the market it will only by high earners or those who have been subsidised who can afford to buy. Not good when you consider housing is an essential commodity and rents are likely to follow house prices upwards.

At any given time it is always the higher earners who can buy so it is their earnings that determine price. You talk as if prices have risen linearly but they haven't and there has been times in the past when prices in relation to earning have been almost as high as they are now. As it happens I agree it would be better if prices were lower but the only real solution to that is to build more properties.

wotsthat

Graham_Devon wrote: »

While I don't agree with everything vince says or does, the point is that it's yet another article about increasing house prices and the dangers.

You said you couldn't take him seriously anymore.

Mind you that was when he said something you disagreed with.

Not that you're fickle.

Thrugelmir

CLAPTON wrote: »

Vince believes that there should be no limit to immigration but has done nothing in government to champion reform for the planning regs so we cna actuall provide decent housing for the expanding population

After Cleggs show with Farage the LibDems are in disarray. No coherent policies. This was an attempt to distract the media rather be anything serious about housing .

Spin doctors are so predictable...........