House prices are still falling

[centurian]

True. But repossessions are not included. Which is the point centaurian was trying to make?

Nor are any auction sales included for that matter (even if instigated without a repossession).

Wasn't the argument for excluding auction sales because they "distort" the figures.

[HairyArsedBloke]

C'mon this is written by that fraking c'nt Blanchflower.

He claims to be a labour economist, what the frak does he know about house prices.

This ..... ...... ....... ...... .... was Labours man on the MPC. He was calling for lower interest rates when we needed higher ones to cool the hyper-inflation on asset prices like houses. He was part of the cause of the problems we face today. He should go to gallows with the rest of 'em.

[expat]

http://www.telegraph.co.uk/finance/5...l-falling.html

House prices are still falling
...
How much further will house prices fall? The best guide is the ratio between average earnings and average house prices. This is a measure of affordability. ...

============================================

A very good article : but one small point. Earnings growth is not totally flat.

One other point: the ratio of average earnings to average house prices is not a good measure of affordability, because people don't buy houses directly out of their salaries, they take out loans. A reasonable measure of affordability would be the ratio between average earnings and average house prices including mortgage interest, because that is what people actually have to pay.

[BrilloPad]

One other point: the ratio of average earnings to average house prices is not a good measure of affordability, because people don't buy houses directly out of their salaries, they take out loans. A reasonable measure of affordability would be the ratio between average earnings and average house prices including mortgage interest, because that is what people actually have to pay.

Which is great until mortgage rates go up. Even if they are fixed the deals come to an end eventually.

Mind you : not much sign of base rates going up for a while. Though I think a few banks would like to rip us off to a few more quid to "rebuild their balance sheet".

[TimberWolf]

Which is great until mortgage rates go up. Even if they are fixed the deals come to an end eventually.

Mind you : not much sign of base rates going up for a while. Though I think a few banks would like to rip us off to a few more quid to "rebuild their balance sheet".

Do interest rates always reflect the rate of inflation? Or can interest rates be low when inflation is high?