Can housing ever actually drop?

zagfles

Voyager2002 said:

zagfles said:

Labour won the 1997 election having made a big issue about negative equity in the 90's. Gordon Brown promised not to let house prices get out of control in his first budget in 1997. Then watched them skyrocket over the next 10 years while boasting about the cause - ie lowest mortgage rates since the 60's.

I was paying a mortgage over this period. Interest rates were not particularly low until after 2008. They had been low in the late 1980s, fuelling the boom, then went to high levels after 1989 putting many people into negative equity before declining to historically reasonable amounts.

Interest rates were historically low well before 2008, Labour election posters in the 2005 election, which of course they won, were boasting of it! See https://www.theguardian.com/media/2005/jan/11/advertising.politicsandthemedia

And they were low because Brown set the BoE an inflation target RPIX which specifically excluded house price inflation. So the BoE didn't care about house price inflation when setting interest rates.

C_Mababejive

Whilst HM Government continues to create fake money and keeps spaffing taxpayers money in propping up housing ponzi schemes, then this countries' precious house prices will continue to rise.

Government has no care as to who is homeless and who is forced to be a rental slave for the rest of their lives.

Thrugelmir

C_Mababejive said:

Whilst HM Government continues to create fake money and keeps spaffing taxpayers money in propping up housing ponzi schemes, then this countries' precious house prices will continue to rise.

Government has no care as to who is homeless and who is forced to be a rental slave for the rest of their lives.

For a Government, housing is an easy way to generate economic activity and most importantly jobs quickly. Grander plans take time to have a meaningful impact. Better left to the private sector.