Very good graph showing long term prices.

magicdogsbrain

I put this on a thread that may not have been seen by everyone.

This graph puts the whole thing in context I reckon. Use scrole wheel to zoom in

http://www.housepricecrash.co.uk/graphs-average-house-price.php

(sorry if everyone already knows about this)

PasturesNew

What I find interesting is that the peak in 1989 wasn't reached again until 2002.

Overall, I've never been aware of housing cycles or boom/crashes before. It's only been this last one that's got me interested.

In the olden days, we didn't have such free and ready access to so much information to find out about these things. Restricted to just a couple of newspapers and a 30 second slot on the news it's not something people in the main have ever thought about before.

magicdogsbrain

Given the long term growth of 2.4% per year - my guess is it will be around 18 years until prices are at this level again.

http://www.allagents.co.uk/calculator/mortgage-rent/

magicdogsbrain

The 90s bubble popped at around 35% above trend whereas this time it was more like 33% - maybe the US helped to knock us down this time.

Woby_Tide

interesting they have to make a point about certain points on the graph for dramatic effect

"Peak of the last housing boom
This looks like a molehill compared to where we currently are.£113,689."

£113,689 at the peak against a trend expectation of £84875 = 33.95% over the trend

fast forward and the peak figure was £179363 against a trend of £143691 = 33.89% over the trend


so they both peaked at pretty much exactly the same point over the trend

magicdogsbrain

Woby_Tide wrote: »

interesting they have to make a point about certain points on the graph for dramatic effect

"Peak of the last housing boom
This looks like a molehill compared to where we currently are.£113,689."

£113,689 at the peak against a trend expectation of £84875 = 33.95% over the trend

fast forward and the peak figure was £179363 against a trend of £143691 = 33.89% over the trend


so they both peaked at pretty much exactly the same point over the trend

Yes they are definitely bears trying to sensationalize. I agree that the data doesn’t really show a huge difference - except this time it was quite a bit slower in the making.

morg_monster

I know this graph is impressive regardless... but my most hated graph trick (as a bona fide statto) is the "start the y axis above 0", in this case, at just over £50,000. Especially in a case like this, where it would not extend the graph by much to take it all the way down to 0!! The graph would still get across the point, and I know the values are clearly marked, but instead of making it look like houses were almost free back in the 70s it would be a bit more honest, IMHO....

bryanb

magicdogsbrain wrote: »

Given the long term growth of 2.4% per year - my guess is it will be around 18 years until prices are at this level again.

http://www.allagents.co.uk/calculator/mortgage-rent/

As I'm 66 my children should benefit then (actuarily)

PasturesNew

morg_monster wrote: »

I know this graph is impressive regardless... but my most hated graph trick (as a bona fide statto) is the "start the y axis above 0", in this case, at just over £50,000. Especially in a case like this, where it would not extend the graph by much to take it all the way down to 0!! The graph would still get across the point, and I know the values are clearly marked, but instead of making it look like houses were almost free back in the 70s it would be a bit more honest, IMHO....

I usually hate that too. Not so much in this case, but I've seen tiny changes made to look huge in other instances.

magicdogsbrain

morg_monster wrote: »

I know this graph is impressive regardless... but my most hated graph trick (as a bona fide statto) is the "start the y axis above 0", in this case, at just over £50,000. Especially in a case like this, where it would not extend the graph by much to take it all the way down to 0!! The graph would still get across the point, and I know the values are clearly marked, but instead of making it look like houses were almost free back in the 70s it would be a bit more honest, IMHO....

I agree - we need a logarithmic scale ideally.

tomstickland

The graph would be better if the y axis was zeroed and they annotated what the top graph is showing.