Cheap Money to Boost U.K. House Prices 6% in 2016

Graham_Devon

Thrugelmir wrote: »

Depends how much ones personal spend is impacted by deflation. I walk to work so petrol price makes little difference to me in the pocket.

People don't see the savings either. We may be paying 22p less per litre than this time last year, which may save people £300 a year.

That's great and I'm happy about that.

But I don't think anyone really sees that £300 in their bank account and thinks "great, we can afford a larger mortgage now, let's sell up and gazump some buyers on a larger property". Same as when petrol increased in price people didn't sell up and downsize.

The saving is too incremental to make much difference to spending habits.

the_flying_pig

Graham_Devon wrote: »

Oh the irony of this sentence...

"Record low interest rates and a resilient economy".

yeah, i suppose it sort of begs the question 'resilient to what?'.


certainly not resilient to historically normal interest, and certainly not historically high, base rates.


a short spell of sat 5-10% base rates would cause one or more of house prices, the banking system, etc, to crack like a raw egg chucked onto concrete from a great height.

Rich2808

Oh please please buy more houses now so us surveyors can make more money?!!

Why do we have these endless forecasts and predictions about house prices when frankly they have no more clue than the rest of us about how prices will move and the increases - or falls - won't in any case be uniform across the country. It will depend on economic factors including external factors - which no one can frankly predict. Have these exact percentage forecasts ever been right?

Prices may go up 20 per cent or fall 10 per cent or go up in Scotland and fall in London - but these ridiculous made up numbers and the reporting of them gets rather tedious! Quoting a made up number like 6 per cent is just silly and a waste of newsprint.

You might as well ask Mystic Meg!

cells

Rich2808 wrote: »

Oh please please buy more houses now so us surveyors can make more money?!!

Why do we have these endless forecasts and predictions about house prices when frankly they have no more clue than the rest of us about how prices will move and the increases - or falls - won't in any case be uniform across the country. It will depend on economic factors including external factors - which no one can frankly predict. Have these exact percentage forecasts ever been right?

Prices may go up 20 per cent or fall 10 per cent or go up in Scotland and fall in London - but these ridiculous made up numbers and the reporting of them gets rather tedious! Quoting a made up number like 6 per cent is just silly and a waste of newsprint.

You might as well ask Mystic Meg!

the analysis probably comes to some sort of a range as a conclusion eg up 2% - 10% next year. but thats not easy enough for a headline so it picks the mid point and goes with that

wotsthat

Thrugelmir wrote: »

Depends how much ones personal spend is impacted by deflation. I walk to work so petrol price makes little difference to me in the pocket.

It's that forum thing again. Petrol going up is bad but no-one can admit to any benefit when it falls.

Graham_Devon

wotsthat wrote: »

It's that forum thing again. Petrol going up is bad but no-one can admit to any benefit when it falls.

Theres an obvious benefit and many on this forum have stated so, including myself directly responding to your post, so it's hardly true to say no one can admit there is a benefit.

But you appear to take that benefit a little too far and that's when people disagree. (That's disagree with your analysis, not disagree with your premise that a saving is a saving and thats a good thing).

22p off a litre of petrol isn't going to have people planning sell to their house and upgrade / buy a second home. Neither is it going to have FTB's jumping into the housing market. This is the only way your theory (that 22p a litre saved on fuel will feed into HPI) would work.

wotsthat

Graham_Devon wrote: »

22p off a litre of petrol isn't going to have people planning sell to their house and upgrade / buy a second home. Neither is it going to have FTB's jumping into the housing market. This is the only way your theory (that 22p a litre saved on fuel will feed into HPI) would work.

Of course no one says 'oh look I'm saving £300 per year on fuel - let's move house'. Creating a silly scenario that has nothing to do with normal people's thought processes hardly disproves my premise that Brits like to spend spare cash on wine and houses.

Having an extra £300 each year will come into play when a move is considered because there's extra cash to pay a mortgage and then you need to add on the pay rise too. People can borrow more and are better able to support a mortgage - try and downplay it but that sounds like a recipe for HPI.

Graham_Devon

wotsthat wrote: »

Having an extra £300 each year will come into play when a move is considered because there's extra cash to pay a mortgage and then you need to add on the pay rise too. People can borrow more and are better able to support a mortgage - try and downplay it but that sounds like a recipe for HPI.

So the flipside of your rather absurd post that 99p a litre petrol is a recipe for HPI would be petrol at £1.20 a litre is a recipe for house price falls.

If I had stated that, you and the merry gang would have been all over it like a rash.

I'm not trying (hardly need to try!) to downplay your argument. I'm just stating it's truly absurd to relate every single extra penny people have into more borrowing power and HPI.

PasturesNew

Thrugelmir wrote: »

Depends how much ones personal spend is impacted by deflation. I walk to work so petrol price makes little difference to me in the pocket.

You should get a car loan, buy a car, then spend every weekend driving about, knowing you're saving a lot of money!

:0

wotsthat

Graham_Devon wrote: »

So the flipside of your rather absurd post that 99p a litre petrol is a recipe for HPI would be petrol at £1.20 a litre is a recipe for house price falls.

Yes, it's not difficult is it? Petrol going up in price takes money out of people's pockets they'd otherwise spend on wine and houses.

These aren't difficult economic principles - pay rises and falling prices of non-discretionary items allow consumers to consume more and vice versa. My theory is Brits like to spend money on wine and houses.

Sometimes you surprise even me. In the last 24 hours you've suggested that if a benefits claimant doesn't get £1500 then £1500 is lost to the economy. And during the depths of the GFC Brits paid down £220bn debt.

I suspect you might have invested your pay rises and petrol savings in drinking earlier in the day.