Reply to: We're Boomed!

[Kinvara]

House prices rising say surveyors


Anyone not on that housing ladder had better get on while prices are still cheap.

Who Lucifer ? Anyone like yourself (given that your wife owns the house you liven in)

If only you had a spine.

[NoddY]

It is the homebuying masses who have expended the labour, not homeowners. Those who have merely held on to a property (or indeed exchanged) through the rampant house price inflation of recent years have profited from the labour of others.

Yes of course. Those who hold no debt are blessed.

[Euro-commuter]

This is called a 'debt harvest'. Wealth is neither created nor destroyed but transferred. Therefore all the labour that was expended by the home-owning masses has resulted in no net gain for them because after reposession they are left with nothing. Most of it actually gets transferred to those who buy at the bottom, with the gatekeepers to capital (i.e. the banks) taking their cut on every transaction.

It is the homebuying masses who have expended the labour, not homeowners. Those who have merely held on to a property (or indeed exchanged) through the rampant house price inflation of recent years have profited from the labour of others.

[NoddY]

Not only in the UK there is lot of credit available in most of the countries. I wonder where all this low interest money is coming from .

Some comes from Japan, but ultimately money is simply created out of thin air. Of course the more money is created the less it is worth, just like any other commodity - this is inflation. Of course if you work for money this is a problem.

[NoddY]

Are banks deliberately over-lending to cause a crash and position themselves for it?

They will end up owning a hell of a lot of property, and this time they might be planning to hold on to repossessions and expand their own BTL businesses.

This has been nagging away at me for ages, but Shirley not?

This is called a 'debt harvest'. Wealth is neither created nor destroyed but transferred. Therefore all the labour that was expended by the home-owning masses has resulted in no net gain for them because after reposession they are left with nothing. Most of it actually gets transferred to those who buy at the bottom, with the gatekeepers to capital (i.e. the banks) taking their cut on every transaction.

[Numptycorner]

> Don't rely on advice from Internet Forums

Wrong, the internet is probably the most valuable source of info now. Of course, you need to know how to filter.

If you're relying on mainstream media, BBC, etc. and financial advisers, then you are up the proverbial creek. The US subprime debacle is only now being widely reported in the mainstream, but it's been discussed for years now.


People get upset if you use the word crash. I prefer 'correction'

Milan re: source of the money. It's the YCT innit? (Actually I only found out a couple of months ago, the SFCT is also massive)

But the media gets the message out to the masses. If the message is panic then people panic. The first rule of economic behaviour is expectations/consumer confidence

[milanbenes]

yes bob i too only found out at the sf doing the same a few months ago

when they put up their rates...

oh dear

anyway folks ignore me, I know nuffin, just an interested spectator


Milan.

[Numptycorner]

If London is the catalyst, why did prices rise double digit in the Midlands and North West while London was stagnating in 2003 (price falls). Surely that should have lead to prices falling elsewhere?

As others have said the key is when the money supply contracts, which it allways does at some point.

[bobhope]

> Don't rely on advice from Internet Forums

Wrong, the internet is probably the most valuable source of info now. Of course, you need to know how to filter.

If you're relying on mainstream media, BBC, etc. and financial advisers, then you are up the proverbial creek. The US subprime debacle is only now being widely reported in the mainstream, but it's been discussed for years now.


People get upset if you use the word crash. I prefer 'correction'

Milan re: source of the money. It's the YCT innit? (Actually I only found out a couple of months ago, the SFCT is also massive)

[wendigo100]

Are banks deliberately over-lending to cause a crash and position themselves for it?

They will end up owning a hell of a lot of property, and this time they might be planning to hold on to repossessions and expand their own BTL businesses.

This has been nagging away at me for ages, but Shirley not?

[Hart-floot]

What's even worse is that people have less money to save, so depend on their homes to provide them with a pension.

One of the differences in this current property bubble, when compared to the one in the late 1980's, has been the demand for BTL by people using it as a pension due to the collapse of private sector final-salary pension schemes etc. BTL's target the same property that 1st time buyers go for hence less property available for 1st timers but more available to rent .

One of the unintended (?!!?) consequences of Gordon Browns pension tax reform made in 1997. Hope all you 1st time buyers appreciate this come election day lol

[wendigo100]

I think a crash will come, but not to the extent of the last.

Well let's hope you are right, but more people are overstretched, and by a lot more money, than the last time.

What's even worse is that people have less money to save, so depend on their homes to provide them with a pension.

[Bright Spark]

good discussion today on bbc website about this

http://news.bbc.co.uk/1/hi/business/6549299.stm

[milanbenes]

andy,

disagree, on the European mainland access to credit is much stricter and rightly so.

I think only the UK and the US are up there leading the way in terms of availability of money.

Where does it all come from ? Now that's a good question, which will be answered another time.

Remember folks do your own research and do not take financial advice from bulletin boards and internet forums,

all the best,

Milan.

[andy]

Not only in the UK there is lot of credit available in most of the countries. I wonder where all this low interest money is coming from .