MSE News: UK house prices reach all-time high, Nationwide says

Graham_Devon

CLAPTON wrote: »

why can't we build more cars, export more high tech equipment, enjoy more coffee shops, greet more tourists because the price of houses have gone up in Devon?

You can, to an extent.

But this point was raised last night on Question Time where a member of the audience, who owns a business in London is finding it increasingly hard to employ people.

These people are the people who will "greet the tourists, sell them the england flag and bobby hat etc etc".

They are also the police, nurses, fireman etc.

It was rasied that that these people can no longer live in the places they are expected to work. The NHS itself is near crisis point with regard to nurses, as fewer and fewer are coming forward for the pay when that pay isn't enough for your living expenses. London nurses already get a top up for working in London, but that top up soimply isn't enough anymore.

So yes, you can build cars, you can greet holidaymakers, but all these people who do that still need a roof over their heads.

It's already happening, it's just we can't see it right now, as a lot of the police, nurses etc bought a house 10-15 years ago and are OK. It's replacing them thats a problem, and the requirement for replacement is starting to hit now. It;s OK saying they should move out a bit and commute in, but commuting comes at a cost, and one which isn't cheap. It's a cost of working that can be seen as reducing your wage. Sometimes it's just not worthwhile if you also have a demanding family life.

As I say, it's not just me saying it, watch Question Time for business owners themselves saying it.

You can only enjoy a coffee shop if there is someone serving you in that coffee shop. Currently there is someone there. But for how much longer with the cost of living in London rising as it is and wages not following?

This has already happened in places down here. Try enjoying a coffee in a coffee shop in some towns in Devon and Cornwall in the winter. You can't. It's all shut down as all the second home owners have gone for the winter. This does bring some employment in the form of "key holding" agencies, which are popping up all over.

IveSeenTheLight

JamesSmith2000 wrote: »

Im surprised it has taken so long, all the talk you would think they would be way above the price from 7 years ago. But no they are only a little above.

You have to remember the market took a 22%ish drop.
IIRC, this is ahead of most experts predictions

JamesSmith2000 wrote: »

For the last 7 years you would have been better off in the stock market or almost anywhere else.

Timeframe is of course very relevant.
You could compare stocks with houses going back to 1999 and you'll find that the FTSE 100 is still below it's peak.

IveSeenTheLight

Pincher wrote: »

A house I have in North London is now £720k, according to Zoopla,

Stop right there.
Zoopla estimates are proven to be wildly inaccurate.

CLAPTON

Graham_Devon wrote: »

You can, to an extent.

But this point was raised last night on Question Time where a member of the audience, who owns a business in London is finding it increasingly hard to employ people.

These people are the people who will "greet the tourists, sell them the england flag and bobby hat etc etc".

They are also the police, nurses, fireman etc.

It was rasied that that these people can no longer live in the places they are expected to work. The NHS itself is near crisis point with regard to nurses, as fewer and fewer are coming forward for the pay when that pay isn't enough for your living expenses. London nurses already get a top up for working in London, but that top up soimply isn't enough anymore.

So yes, you can build cars, you can greet holidaymakers, but all these people who do that still need a roof over their heads.

It's already happening, it's just we can't see it right now, as a lot of the police, nurses etc bought a house 10-15 years ago and are OK. It's replacing them thats a problem, and the requirement for replacement is starting to hit now. It;s OK saying they should move out a bit and commute in, but commuting comes at a cost, and one which isn't cheap. It's a cost of working that can be seen as reducing your wage. Sometimes it's just not worthwhile if you also have a demanding family life.

As I say, it's not just me saying it, watch Question Time for business owners themselves saying it.

You can only enjoy a coffee shop if there is someone serving you in that coffee shop. Currently there is someone there. But for how much longer with the cost of living in London rising as it is and wages not following?

This has already happened in places down here. Try enjoying a coffee in a coffee shop in some towns in Devon and Cornwall in the winter. You can't. It's all shut down as all the second home owners have gone for the winter. This does bring some employment in the form of "key holding" agencies, which are popping up all over.

well, we both agree we need to build more property for people to live in.

The 'question time' discussion has of course been repeated every year of at least 50 years with similar warnings that the London infrastructure is about to collapse.

Presumably the argument is that 'it's different this time'.

By now London should be a wasteland devoid of ordinary working people: last time I was there (a few weeks ago) it looked pretty busy.
I believe it has a net inward migration both from abroad and other parts of the UK.

When businessmen say they can't recruit there is one simple question to ask: what are they paying?

The market will largely self correct. People will leave (or not go) so price of labour will rise.
If companies don't want to pay then they either improve productivity, move out of London or go out of business.

This all happens automatically without tax payer subsidy.

In any event anything that encourages business to move out of London can't all be bad.

The lack of demand for coffee in Devon during the winter has nothing to do with holiday homes or the price of houses but rather the lack of jobs.

I think we should build a lot more houses for people to live in but I don't see their price as something that stops us export or manufacture

wotsthat

Graham_Devon wrote: »

This has already happened in places down here. Try enjoying a coffee in a coffee shop in some towns in Devon and Cornwall in the winter. You can't. It's all shut down as all the second home owners have gone for the winter. This does bring some employment in the form of "key holding" agencies, which are popping up all over.

It happened as soon as the Victorians started to take holidays. Tourist destinations have less people out of season and more people in season. It has always been the case and always will be.

Out of interest did your business owners on QT offer any potential solutions to the housing shortage they described?

Pincher

Servants were always housed. Five hundred years ago, it might be in the barn, or you sleep on the floor in the hall. One hundred years ago, it might be in the attic or the basement.


I saw a brand new development in Pudong (Shanghai), in a hyper-modern Californian style three bedroom terrace house arranged over five levels, with a light well (Imagine a chimney not there, so light comes down to all the levels) and TWO sun decks (~balcony) . Amidst all this contemporary life style overload, you find a mezzanine level neatly tucked away above the garage. The room size is about that of a double bed, plus a foot or two at the end so you actually have a floor to stand on. You then realise the garage height has been reduced to squeeze this NANNY room in. Mary Poppins needs to be less than six foot tall, as that is the ceiling height in the nanny room.


All those Georgian and Victorian townhouses with servant's quarters will come in handy again, soon.


As people find it hard to treat people they know as underlings, it's probably best to work in another town as live-in servants. When you come home for Christmas, you are socially equal again. Same principle as prostitutes don't work where they live. Really embarrassing if your Rabbi or Imam walks in off the street for your services.

CLAPTON

Pincher wrote: »

Servants were always housed. Five hundred years ago, it might be in the barn, or you sleep on the floor in the hall. One hundred years ago, it might be in the attic or the basement.


I saw a brand new development in Pudong (Shanghai), in a hyper-modern Californian style three bedroom terrace house arranged over five levels, with a light well (Imagine a chimney not there, so light comes down to all the levels) and TWO sun decks (~balcony) . Amidst all this contemporary life style overload, you find a mezzanine level neatly tucked away above the garage. The room size is about that of a double bed, plus a foot or two at the end so you actually have a floor to stand on. You then realise the garage height has been reduced to squeeze this NANNY room in. Mary Poppins needs to be less than six foot tall, as that is the ceiling height in the nanny room.


All those Georgian and Victorian townhouses with servant's quarters will come in handy again, soon.


As people find it hard to treat people they know as underlings, it's probably best to work in another town as live-in servants. When you come home for Christmas, you are socially equal again. Same principle as prostitutes don't work where they live. Really embarrassing if your Rabbi or Imam walks in off the street for your services.

I've noticed that the price of bananas has fallen recently

do you think that is because the Wimbledon people are eating fewer these days.

posh*spice

CLAPTON wrote: »

is (or should it be) the BoE primary task to stop asset bubbles or is it (should it be) concerned with financial stability, economic growth unemployment levels etc?

Well, Alan Greenspan is widely accredited as being responsible for the 2008 crisis by keeping interest rates too low for too long - so yes the BOE should be worried about bubbles.

In the wake of the subprime mortgage and credit crisis in 2007, Greenspan stated that there was a bubble in the US housing market, warning in 2007 of "large double digit declines" in home values "larger than most people expect".[58] However, Greenspan also noted, "I really didn't get it until very late in 2005 and 2006."[59]
Greenspan stated that the housing bubble was "fundamentally engendered by the decline in real long-term interest rates",[60]]

http://en.wikipedia.org/wiki/Alan_Greenspan

What is going to happen when interest rates start rising as they surely must?

CLAPTON

posh*spice wrote: »

Well, Alan Greenspan is widely accredited as being responsible for the 2008 crisis by keeping interest rates too low for too long - so yes the BOE should be worried about bubbles.

http://en.wikipedia.org/wiki/Alan_Greenspan

What is going to happen when interest rates start rising as they surely must?

I don't think there is any parallel in the UK with the totally dysfunctional state of the US market in 2007-8.

There is no evidence that there is likely to be wide spread mortgage default here in the UK.

Thrugelmir

CLAPTON wrote: »

When businessmen say they can't recruit there is one simple question to ask: what are they paying?

I would say a lack of skills and endeavour.