Inflation rising, stocks down - end of housing boom?

[milanbenes]

at last,

sasguru is agreeing with the Benes Invoicing Ltd wisdom !

good lad

Milan.

[Hart-floot]

If 40-50% happened that would probably be fantastic for me (and a bit scary for the nation). I don't know how long a crash takes in the house market. I was figuring a very very slow burn <> 2 years.

If all houses were 50% cheaper next week then I'd be lovin' it.

Would you not worry that the market may not have bottomed out ?

I seem to remember that the last house market "correction" lasted from 1989 to 1996 (depending on the region). House prices dropped in my area, by 25-30%. In real terms, against an average inflation rate of 6% of the time, it still took at least 6 years to drop 40-50%, chances of that happening now in 2 years are pretty slim.

Dont forget that unemployment then was 10%+ and the rubbish ERM policy of the Major/Thatcher government overvalued the pound. Now, emplyment prospects are better (not sure for how much longer though!), bank of england controlling interest rates, huge rise in more households thru immigration plus people opting for the single life are underpinning the housing market.

[Troll]

[QUOTE=BlasterBates]Well the thing to bear in mind is that immigrants are not permanent like they were. India and China have booming economies, immigrants are even returning to places they wouldn't have gone back to 20 years ago.

What does that mean...

Well there are 200,000 going out and 400,000 (or whatever ) coming in. If the economy goes down then, you'll find the new generation of fickle immigrants will quickly disappear and you get the "Germany" effect, i.e. net emigration and a population decline, which means a....

A HOUSE PRICE CRASH[/QUOTE

Would that be a price worth paying?

[wendigo100]

The so-called economic miracle has been largely driven by a spending boom. Our economy is soundish - despite gradually increasing unemployment. House prices are kept high by demand - in part from massive net immigration.

The whole economy is being driven by an unprecedented borrowing boom. Bit of a house of cards if you ask me.

[AlfredJPruffock]

The whole economy is being driven by an unprecedented borrowing boom. Bit of a house of cards if you ask me.

Aye W

Heres a case in point, heard from an old pal yesterday who is now living in London with his wife and kids, he and his wife is on social security and has his rent paid by the council.

I was astonished when he told me that over the past couple of months he applied for several credit cards and now has received a value 15k worth of various cards which he intends to max out and he has no chance of repaying whatsoever.

Im sure he is not he only one, what kind of checks are these credit companies doing for crying out loud ?

[milanbenes]

it is interesting that the great unwashed are beginning to realise there is a crash coming

all we need now is for them to slow down there spending and...

pop

it'll all go t u

Milan.

[Angela_D]

Having see the inside of a household name credit card call / debt centre. I would say vitually None.

If you tell them what they want to hear, they won't query it.

Banks are in a money for old rope situation. You borrow at anything from 6 to 30% + annually. They are getting it from BoE / ECB network at a fraction of that. So why would they do anything to stop this ?

[NoddY]

...They are getting it from BoE / ECB network at a fraction of that. So why would they do anything to stop this ?

They don't 'get' money from anywhere. They are allowed to create money from nothing based on the amounts they hold in trust i.e. deposits. Why else do you think inflation exists?

Therefore most of the interest people pay is interest on money that never really existed.

[swamp]

First time buyers priced out

I know alot of would-be first time buyers that are priced out the market, or haven't got their tulip together yet. If prices fell then they would buy in and help push the market back up.

[DimPrawn]

Mark my words, within the next 50 years, there will be a property price crash.

You have been warned.