Interest rates

tr3mor

wibble68 wrote: »

Are you saying that supply and demand is the number 1 driver of house prices?

Supply and demand is the number 1 driver of any prices.

He simply failed to realise what supply and demand actually are. It's not just "there are lots of people; people want houses to live in; therefore prices will stay high forever".

wibble68_2

tr3mor wrote: »

Supply and demand is the number 1 driver of any prices.

I have to disagree.

Supply and demand is a result not a cause.

High interest rates / lack of affordability = less demand.

Negative sentiment / lack of investors = less demand.

tr3mor

wibble68 wrote: »

I have to disagree.

Supply and demand is a result not a cause.

High interest rates / lack of affordability = less demand.

Negative sentiment / lack of investors = less demand.

Yes. And less demand = lower equilibrium price.

There are an infinite number of variables influencing supply and demand but it is supply and demand that set prices.

Of course, it's all b*llocks, since there's no such thing as a perfect market but never mind.

wibble68_2

tr3mor wrote: »

Supply and demand is the number 1 driver of any prices.

tr3mor wrote: »

There are an infinite number of variables influencing supply and demand.

You seem to be contradicting yourself.

carpetbelly

not defending tr3mor here but he did also say

[qupte]but it is supply and demand that set prices.[/quote]

at the end of the sentence you're quoting there.

it's nice when people pick and choose part of a sentence to quote that suits their criteria.

Or if you're trying to say that part contradicts with the rest of the sentence to me it looks like that there are many parts that make up supply and demand but in the end, you can say supply and demand is what sets the price in the end. Put me right tr3mor if I'm wrong please.

SquatNow

Interest Rates cannot drop as inflation would pick up and the value of the pound would drop. As we are dependant on imported energy, this would mean all the lights would go out.

tr3mor

wibble68 wrote: »

You seem to be contradicting yourself.

No I'm not. There is an infinite number of things that influence any decision I make. But ultimately I make the decision.

You used the term "number 1 driver".

I gather that you are of the view that supply and demand are influences like weather and lending criteria. Rather than the "summation" of these influences?

tr3mor

carpetbelly wrote: »

It looks like that there are many parts that make up supply and demand but in the end, you can say supply and demand is what sets the price in the end. Put me right tr3mor if I'm wrong please.

Spot on! :beer:

wibble68_2

carpetbelly wrote: »

It looks like that there are many parts that make up supply and demand but in the end, you can say supply and demand is what sets the price in the end. Put me right tr3mor if I'm wrong please.

My original point was that I disagree with this concept that supply and demand is the number 1 driver of house prices.

I believe that house prices are set by affordability and sentiment.

You state that "supply and demand is what sets the price in the end."

Well if it's the last piece in the jigsaw then how can it be the number 1 cause of house price fluctuations?

tr3mor

I don't know if you're being stupid or just argumentative. Your original question implies the former.

wibble68 wrote: »

My original point was that I disagree with this concept that supply and demand is the number 1 driver of house prices.

If supply and demand stay the same then house prices stay the same.

If supply or demand change then house prices change. (Unless we get a very unlikely equal shift.)

wibble68 wrote: »

I believe that house prices are set by affordability and sentiment.

You state that "supply and demand is what sets the price in the end."

Well if it's the last piece in the jigsaw then how can it be the number 1 cause of house price fluctuations?

It's not any piece in the jigsaw. It's the whole thing.