"Confirmation Bias" among generation who did well from house prices

Cornucopia

And did they deliver on their manifesto?

BTW the youngest babyboomers would have been 2-years-old in 1966. How did they benefit, exactly?

princeofpounds

all of these ideas that today get suggested as ways forward by people who babyboomers today attempt to paint as, y'know, idle, jealous little deviants or whatever, fifty years ago they were so mainstream as to be the proudly trumpeted policy of the conservative party. what changed?

Almost like flipping a switch... They were so successful that most people got to own a home. Once most people owned a home, driving up the value was a winner. Pro-house price policy became even more feverish in the Blair years, and really is only just starting to turn (on planning reform, if not on demand-boosting schemes)

ruggedtoast

This is exactly correct. Boomers look at young people without a house, look at the fact they own a phone and assume that is the reason. Ignoring the fact houses are ten times more expensive than they were in Boomer times.

CLAPTON

ruggedtoast wrote: »

This is exactly correct. Boomers look at young people without a house, look at the fact they own a phone and assume that is the reason. Ignoring the fact houses are ten times more expensive than they were in Boomer times.

presumably that observation is based on you talking to your parents / grandparent, aunts/ uncles etc

Windofchange

For me, anyone who thinks that things are fair and sustainable, certainly around London and the South East needs their head looking at. The UK seems obsessed with this drive for ever increasing house prices, and to my mind it is making up for the shortfalls elsewhere in the economy. What do high house prices actually produce? There is no tangible product from them. It benefits some who sell up and cash in a fortune, and the rich of course get richer, but for the vast majority of us what benefit does it have?

I'm not going to start blaming other generations - I think people of my generation have had benefits that my father and grandfather never had - universities, travelling, cheap credit, not living through a war! Simply looking at facts however, this cannot go on forever. Who is going to keep buying million pound 1 bed flats? We have so many housing props currently it's like a drunk getting that last hit of whisky to keep them going that little bit longer. At some point the party has to end. There will be winners, and there will be losers, but my feeling is the vast majority of losers will be from the under 50 demographic. If house prices fall dramatically, and interest rates go up, what does the 70 year old with no mortgage care? The over-leveraged 40 year old however...

I think it is sad that things have been allowed to get to this state. The sole purpose of government policy in the last 15 years or so has been to keep house prices rising at all costs. Argue all you want about the details of it, but housing where I am is astronomically unaffordable. I'm not trying to live in a penthouse in Kensington, but when 3.5 x salary won't get you a garage in Croydon you have to wonder.

cells

Windofchange wrote: »

For me, anyone who thinks that things are fair and sustainable, certainly around London and the South East needs their head looking at. The UK seems obsessed with this drive for ever increasing house prices, and to my mind it is making up for the shortfalls elsewhere in the economy. What do high house prices actually produce? There is no tangible product from them. It benefits some who sell up and cash in a fortune, and the rich of course get richer, but for the vast majority of us what benefit does it have?

I'm not going to start blaming other generations - I think people of my generation have had benefits that my father and grandfather never had - universities, travelling, cheap credit, not living through a war! Simply looking at facts however, this cannot go on forever. Who is going to keep buying million pound 1 bed flats? We have so many housing props currently it's like a drunk getting that last hit of whisky to keep them going that little bit longer. At some point the party has to end. There will be winners, and there will be losers, but my feeling is the vast majority of losers will be from the under 50 demographic. If house prices fall dramatically, and interest rates go up, what does the 70 year old with no mortgage care? The over-leveraged 40 year old however...

I think it is sad that things have been allowed to get to this state. The sole purpose of government policy in the last 15 years or so has been to keep house prices rising at all costs. Argue all you want about the details of it, but housing where I am is astronomically unaffordable. I'm not trying to live in a penthouse in Kensington, but when 3.5 x salary won't get you a garage in Croydon you have to wonder.

Some things to consider


London was too cheap in the 1990s due to about 30 years of good house building coupled with a falling population. So much so that, even by the year 2000, Londons citizens were living less dense than any other region of England (people per home). That has all changed over the last 15 years

House prices vs GDP are almost flat over the last 20 years for more than half the country (NE NW W-Midlands E-Midlands Wales)

Globalisation has meant places/people that trade internationally rather than jist nationally or locally have done a lot better. Professional footballers or A star lost actors are paid insane money now. 50 years ago they were not. A big part of the reason is globalisation they can 'sell' themselves to many more people.

London is a 'pro' football player...or the city of London is and its wages have gone up much more than national pr locap players

The housing stock has been improved. When you lool at the average house today it isn't the same as the average house 30 years ago. From better boilers tp loft extensions to house extensions to basement conversions to £20k kitchens and bathrooms...... thisis especially true in inner london. So when it says prices up 20% it doesn't take Into account that some of that was because people spent £2m extending and improving their home

BobQ

Graham_Devon wrote: »

The title is part of a much bigger article looking at whether politicians could ever put a pledge out to reduce house prices.

It looks back a couple of decades and looks at how politicians pledged to do just that, however, today it would be political suicide.

The piece regarding confirmation bias though struck me as it's something that's endlessly discussed on here. i.e. "you just have to do the same as I/We did and you will have it all later too".

I'd agree with Professor Dorling! There does appear to be an attitude of "just work like we did and you will get the same". It's all over these forums.

These people are also much more likely to appose new building in their areas. Described as "insiders" whose influence on the planning system (because they own their own home and are therefore in the area ready to protest) prevents the "outsiders" from a secure place to live. Often the "outsiders" are their own children.

Huge amount in the article itself though, well worth a read.

http://www.bbc.co.uk/news/magazine-32065625

The long term growth in HPI is due to many factors. A lot is made of the growth of BTL which is a factor. Equally the failure to arrange the economy on the basis that we must build more houses is a factor.

But a factor we hear little about is the growth in two income families. These days it is very common that mortgages are granted based on multiple incomes. Fifty years ago many more houses were purchased based on one income. The consequence of this is that as the family income goes up, the average house prices rise because families are willing to pay more for a house.

CLAPTON

Windofchange wrote: »

For me, anyone who thinks that things are fair and sustainable, certainly around London and the South East needs their head looking at. The UK seems obsessed with this drive for ever increasing house prices, and to my mind it is making up for the shortfalls elsewhere in the economy. What do high house prices actually produce? There is no tangible product from them. It benefits some who sell up and cash in a fortune, and the rich of course get richer, but for the vast majority of us what benefit does it have?

I'm not going to start blaming other generations - I think people of my generation have had benefits that my father and grandfather never had - universities, travelling, cheap credit, not living through a war! Simply looking at facts however, this cannot go on forever. Who is going to keep buying million pound 1 bed flats? We have so many housing props currently it's like a drunk getting that last hit of whisky to keep them going that little bit longer. At some point the party has to end. There will be winners, and there will be losers, but my feeling is the vast majority of losers will be from the under 50 demographic. If house prices fall dramatically, and interest rates go up, what does the 70 year old with no mortgage care? The over-leveraged 40 year old however...

I think it is sad that things have been allowed to get to this state. The sole purpose of government policy in the last 15 years or so has been to keep house prices rising at all costs. Argue all you want about the details of it, but housing where I am is astronomically unaffordable. I'm not trying to live in a penthouse in Kensington, but when 3.5 x salary won't get you a garage in Croydon you have to wonder.

you have forgotten to say : build more houses and restrict the demand (population)
easy mistake to make when on a rant.

Sapphire

Windofchange wrote: »

The UK seems obsessed with this drive for ever increasing house prices, and to my mind it is making up for the shortfalls elsewhere in the economy. What do high house prices actually produce? There is no tangible product from them. It benefits some who sell up and cash in a fortune, and the rich of course get richer, but for the vast majority of us what benefit does it have?

I think it is sad that things have been allowed to get to this state. The sole purpose of government policy in the last 15 years or so has been to keep house prices rising at all costs. Argue all you want about the details of it, but housing where I am is astronomically unaffordable. I'm not trying to live in a penthouse in Kensington, but when 3.5 x salary won't get you a garage in Croydon you have to wonder.

The problem is that housing in London in particular is now regarded by many (especially affluent) people globally, not just in the UK, as a financial asset (like gold), rather than as a place to live. It's a replacement for all the manufacturing and industry that this country used to have, and property is being 'traded' globally, which is why may 'locals' don't get a look-in. Without the rises in property prices, and if property was not regarded in the way it is now, the economy would probably be in a far worse state than it is now. That's why there is the constant drive to sell to foreign investors – building concerns and perhaps other outfits like councils stand to earn huge amounts of money from such sales, and thereby help to prop up the economy. I can't think what will happen when it all comes crashing down…

There's no point in 'blaming' any particular age group for this situation – and it seems to me that the British people who have bought and are still buying expensive property in London are often in their forties, not of the age of 'boomers'. Around me, it's people precisely in their forties, with young families, who buy properties, then do them up with expensive extensions, thereby increasing the value.

A massive amount of property has been built in the derelict East End – if it were not for all the foreign buyers, I wouldn't be surprised if there would be enough housing for all Brits who need to live in London and want to buy a property, and it would be far less expensive than it is now.

PixelPound

ruggedtoast wrote: »

This is exactly correct. Boomers look at young people without a house, look at the fact they own a phone and assume that is the reason. Ignoring the fact houses are ten times more expensive than they were in Boomer times.

Surely this is the case? Disposable income is higher now - its okay saying house prices are higher, but so are wages, where as food and clothing hasn't kept pace. People choose to spend there money on "necessities" like high cost mobile tariff, all-singing Sky TV packages, and console games that take up a large part of their monthly income.