Radio 4: Bricks and Bubbles

Thrugelmir

AndyGuil wrote: »

Asking prices up 0.85% for London, 0.57% UK.

Wasn't it 3 regions up and 7 down.........

So excluding London, 2 vs 7.

Generali

ukcarper wrote: »

Do you think land registry make up figures latest report shows prices up 9.2% over the last year in Oldham with 0% over month. Average price £83k not exactly out of reach for someone on average earnings.

How much do people in Oldham earn?

In_For_A_Penny_2

New to this forum and just to put my cards on the table, I'm a would-be first-time-buyer so I'm watching the market very carefully. Interesting piece on Radio 4 and looking forward to the rest of it.

HAMISH_MCTAVISH wrote: »

Northern Ireland is a completely different situation to the rest of the UK.

The mainland UK did not have a speculative bubble in house prices, just a genuine imbalance between supply and demand which caused prices to rise in order to ration the limited supply.

Isn't the precisely what is happening in the rest of the UK now? Buying mainly if not exclusively because of prices going up? Whether its for potential profit, fear or greed - when buying is solely on account of anticipated rises, we're looking at moving into potential bubble territory.

The Radio 4 piece was frightening - shared viewings with people filling in offers on the way out. Crazy. Sad that we've ever got into this situation (again).

ukcarper

Generali wrote: »

How much do people in Oldham earn?

I'm not sure but I would imagine a lot less than national average but 2 people on minimum wage would earn £24k between them.

CLAPTON

In_For_A_Penny wrote: »

New to this forum and just to put my cards on the table, I'm a would-be first-time-buyer so I'm watching the market very carefully. Interesting piece on Radio 4 and looking forward to the rest of it.



Isn't the precisely what is happening in the rest of the UK now? Buying mainly if not exclusively because of prices going up? Whether its for potential profit, fear or greed - when buying is solely on account of anticipated rises, we're looking at moving into potential bubble territory.

The Radio 4 piece was frightening - shared viewings with people filling in offers on the way out. Crazy. Sad that we've ever got into this situation (again).

no, buying because prices are going up, may or may not be a potential bubble.


if population is rising and few houses are being built then it's reasonable to assume that in many places prices will rise : no bubble

In_For_A_Penny_2

CLAPTON wrote: »

no, buying because prices are going up, may or may not be a potential bubble

Sure. I understand - and that sort of inflationary pressure is key to any healthy economy. But the panic buying outlined in the Radio 4 piece is anything but healthy.

CLAPTON

In_For_A_Penny wrote: »

Sure. I understand - and that sort of inflationary pressure is key to any healthy economy. But the panic buying outlined in the Radio 4 piece is anything but healthy.

if the prices are going up because the population is increasing and we aren't building enough then price will rise further




no idea what 'healthy' mean in this context

In_For_A_Penny_2

CLAPTON wrote: »

no idea what 'healthy' mean in this context

I'm no economist and have only a basic understanding of these things but I would consider a "healthy economy" to mean prices rising in accordance with what people can afford. Ideally in line with wage increases?

AndyGuil

They rise according to what the proportion of the population makes up the demand. As the demand is much higher than supply it can only increase.

Reactor_2

In_For_A_Penny wrote: »

New to this forum and just to put my cards on the table, I'm a would-be first-time-buyer so I'm watching the market very carefully. Interesting piece on Radio 4 and looking forward to the rest of it.



Isn't the precisely what is happening in the rest of the UK now? Buying mainly if not exclusively because of prices going up? Whether its for potential profit, fear or greed - when buying is solely on account of anticipated rises, we're looking at moving into potential bubble territory.

The Radio 4 piece was frightening - shared viewings with people filling in offers on the way out. Crazy. Sad that we've ever got into this situation (again).

I don't think we are in bubble territory, yet, as I've yet to hear random people talk (gloat) about how much money they have made on their property and how they didn't need a deposit with their mortgage.

We need to see the crazy 100%+ mortgages appearing too and the offsetting mechanism (CDO equivalents). If a company can repackage this rubbish (subprime mortgages) and sell them as 'guaranteed notes' paying 5%, then mortgage buyers will be able to finance for free, savers will get 5%, the repackaging company gets it's fee, creating jobs all round. It's a win, win scenario! (Another phrase I heard people saying a lot at the peak).

However, instead of the banks taking a hit this time, normal people will, losing all their life savings, as they have bought a structured product, which is not insured against losses.