Debate House Prices


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Who is responsible for the cost of house?

245

Comments

  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    What I mean is, who or what is responsible for the steep rise in the cost of buying a house nowadays?

    Supply and demand.

    We need to build around 250,000 to 300,000 additional houses a year, we actually build around half that number, and this under-building has been going on for almost two decades.

    It has been worsened in recent times by mortgage rationing, as the banks still issue only around half the numbers of mortgages they did before the credit crunch, this has led to builders not building what they can't sell, so house building numbers have fallen to the lowest level in 100 years...
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”

    -- President John F. Kennedy”
  • Don't believe what you read.

    I can reveal exclusively for the first time that there is one cause, and one cause only, and that is Hamish McTavish.

    He may come across as an honest provider of accurate statistics, keen observations, and an analysis of the mortgage and building markets, but that's just a 'front'.

    Behind the scenes, he sticks his paws into the 'establishment' and systematically ramps up the prices. His assertions of a tight mortgage market and a lack of building can sound credible, and his tentacles reach so far into the inner workings of Government, Business, Whitehall, and the Bank of England that everyone believes his predictions, which thus become a self-fulfilling prophesy.

    The only way to stop this is to join HPC and work tirelessly towards their mission of making them crash......
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    stator wrote: »
    Human greed is responsible. The greed of people selling houses who try to push for 10k more than other houses have sold for. The greed of people who have a few grand spare and decide to become BTL landlords, pushing out first time buyers. The greed of land owners who push for unreasonable amounts of money to build houses on their old land. The greed of house developers who control their developments to avoid flooding the market and try to push up prices. The greed of estate agents trying to maximise their commission by inventing non existant competive offers. The greed of NIMBYs who want to prevent people building houses anywhere near them and the politicians who come up with stupid policies like green belt land to help them.
    Have I left anyone out?


    Yes, you left out bankers, the main cause with their greed to push cheap credit, take that away and the Ponzi must fail, hence all the government intervention to desperately try to prop things up.
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    Don't believe what you read.

    I can reveal exclusively for the first time that there is one cause, and one cause only, and that is Hamish McTavish.

    He may come across as an honest provider of accurate statistics, keen observations, and an analysis of the mortgage and building markets, but that's just a 'front'.

    Behind the scenes, he sticks his paws into the 'establishment' and systematically ramps up the prices. His assertions of a tight mortgage market and a lack of building can sound credible, and his tentacles reach so far into the inner workings of Government, Business, Whitehall, and the Bank of England that everyone believes his predictions, which thus become a self-fulfilling prophesy.

    The only way to stop this is to join HPC and work tirelessly towards their mission of making them crash......


    Or drop the price of oil and crash Hamish`s home town hard thus reducing his posting rate by about 80% :rotfl:
  • System
    System Posts: 178,355 Community Admin
    10,000 Posts Photogenic Name Dropper
    Supply and demand.
    Government increases the demand with subsidies and low interest rates.
    Government restricts the supply with planning regulations.
    This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com
  • westernpromise
    westernpromise Posts: 4,833 Forumite
    High prices are the fault of buyers.

    Someone who buys a house, occupies it for 40 years then sells it, has done nothing to affect the price of houses. He has simply used the house as it was meant to be used.

    If he paid £19,000 for it and 44 years later along comes a buyer who bids £2 million, who brought that about? Er, the buyer, who has to match the selling price of other nearby houses...to other buyers.
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    High prices are the fault of buyers.

    Someone who buys a house, occupies it for 40 years then sells it, has done nothing to affect the price of houses. He has simply used the house as it was meant to be used.

    If he paid £19,000 for it and 44 years later along comes a buyer who bids £2 million, who brought that about? Er, the buyer, who has to match the selling price of other nearby houses...to other buyers.


    Problems arise though when the seller thinks it is "worth" three million :rotfl:
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    In recent years it was all just a credit fuelled Ponzi with the main aim of bankers getting their bonus, and it can only continue with large numbers of new buyers entering the pyramid, this is unlikely to happen at todays prices though.
  • westernpromise
    westernpromise Posts: 4,833 Forumite
    stator wrote: »
    Human greed is responsible. The greed of people selling houses who try to push for 10k more than other houses have sold for. The greed of people who have a few grand spare and decide to become BTL landlords, pushing out first time buyers. The greed of land owners who push for unreasonable amounts of money to build houses on their old land. The greed of house developers who control their developments to avoid flooding the market and try to push up prices. The greed of estate agents trying to maximise their commission by inventing non existant competive offers. The greed of NIMBYs who want to prevent people building houses anywhere near them and the politicians who come up with stupid policies like green belt land to help them.
    Have I left anyone out?

    Yes, you've left out buyers, who could choose not to pay the asking price. Houses, surprisingly, tend to be sold to buyers. When a house is sold the seller sells it to the buyer. The seller does not sell it to another seller.

    Disgruntled buyers should get together with sympathetic sellers and agree to sell their houses at the right price. The right price is some figure lower than presently, and that enables the buyer to occupy a house they would like to occupy but that they want cheaper than others are prepared to pay.

    What could be fairer than that?
  • westernpromise
    westernpromise Posts: 4,833 Forumite
    Problems arise though when the seller thinks it is "worth" three million :rotfl:

    The seller can think it's worth anything he likes but there's no deal unless the lowest he's prepared to go is matched or bettered by what's the highest a bidder is prepared to go.

    It follows that if a seller thinks the house is worth 3 million and buyers think it's worth 2 million then it won't sell until he drops his price.

    Sellers are price-takers from buyers.
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