Containg the Property Boom


M

Malcolm Shykles

Raising interest rates may not be the answer to containing house
prices.

One of the major reasons; is that the present boom in house prices
started with Brown's £6 billion-a-year raid on pension funds in 1997.

The destruction of this pillar of long term savings has resulted in
heavy property investment and a corresponding fall in the value of
equities.

Some parents are actually selling stocks to fund their children into
the property market.

The knock on effect is devastating for young and old alike. Young
couples cannot afford houses and pensioners' funds have lost
considerable value.

Both have been forced into relative poverty. We are now in a crazy
situation. Perhaps heading for Japanese disaster similar to that of
1990 when property values reached around five times their realistic
levels.

When the Stock Market gets more attractive (and this maybe brought
about by a change in government), that I think, will be the danger
time for house values.

Malcolm Shykles
 
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J

John Smith

Malcolm Shykles said:
Raising interest rates may not be the answer to containing house
prices.

One of the major reasons; is that the present boom in house prices
started with Brown's £6 billion-a-year raid on pension funds in 1997.

...then a bit of a rant

When the Stock Market gets more attractive (and this maybe brought
about by a change in government), that I think, will be the danger
time for house values.

Malcolm Shykles
Thanks for sharing... Your will find happiness on
http://www.housepricecrash.co.uk
 
J

Jon S Green

One of the major reasons; is that the present boom in house prices
started with Brown's £6 billion-a-year raid on pension funds in 1997.
Nope, it started with Nigel fscking Lawson's announcement that joint
MIRAS would be abolished for new applicants ... in six months' time.

Result: a monstrous bubble in the housing market whilst non-married
couples, young professionals buying in common to beat rental prices, and
any other group purchasers raided the market for anything they could
find that they could get bought within that period. And despair for
anyone else instantly priced out of the market whilst house prices
almost doubled in a few months.

A few years later, it all collapsed again, and negative equity became a
force of misery for hundreds of thousands, with follow-on effects on the
domestic economy as consumers suddenly lost spending power.


Jon
 
J

John Smith

I was reading a report yesterday, think it was the Council of Mortgage
Lenders, that said historically the amount of BTL mortgages given out was
about 28,000 per year but last year some 400,000 BLT mortgages were givern
out.


Jon S Green said:
Nope, it started with Nigel fscking Lawson's announcement that joint
MIRAS would be abolished for new applicants ... in six months' time.

Result: a monstrous bubble in the housing market whilst non-married
couples, young professionals buying in common to beat rental prices, and
any other group purchasers raided the market for anything they could
find that they could get bought within that period. And despair for
anyone else instantly priced out of the market whilst house prices
almost doubled in a few months.

A few years later, it all collapsed again, and negative equity became a
force of misery for hundreds of thousands, with follow-on effects on the
domestic economy as consumers suddenly lost spending power.


Jon
email.
 
D

Doug Ramage

I am suggesting to my BTL clients to review their portfolios to see if a
pile of cash might not be a better option at the moment.

The current asset value increases mean that some of the returns have fallen
below 4% p.a. even without void periods The downward pressure on rents won't
help either.
 
M

Malcolm Shykles

Jon S Green said:
Nope, it started with Nigel fscking Lawson's announcement that joint
MIRAS would be abolished for new applicants ... in six months' time.

Result: a monstrous bubble in the housing market whilst non-married
couples, young professionals buying in common to beat rental prices, and
any other group purchasers raided the market for anything they could
find that they could get bought within that period. And despair for
anyone else instantly priced out of the market whilst house prices
almost doubled in a few months.

A few years later, it all collapsed again, and negative equity became a
force of misery for hundreds of thousands, with follow-on effects on the
domestic economy as consumers suddenly lost spending power.


Jon
No that was in August 1988. A semi in Essex was worth(at the market
peak)some £80,000. One could now be sold for around £200,000 or more.
The realistic value would be around £160,000.

Malcolm
 
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D

Daytona

Jon S Green said:
Nope, it started with Nigel fscking Lawson's announcement that joint
MIRAS would be abolished for new applicants ... in six months' time.
This occurred in the 03/88 budget and double relief ended in 08/88.

Before this Lawson had carried out a currency fix with the Deutschmark
at around DEM 3 to the pound. This occurred from around 03/87 to 03/88
and resulted in base (and exchange) rates being lower than they would
otherwise have been.

So house price inflation was well and truly primed.

More info. here -
<URL:http://news.bbc.co.uk/1/hi/programmes/the_westminster_hour/1940421.stm>

Subsequently some fuckwit called Major carried out another currency
fix with the EMU between 10/90 and 9/92 resulting in base (and
exchange) rates higher than they would otherwise have been.

So house price deflation was well and truly primed.

Daytona
 
S

sam1967

This occurred in the 03/88 budget and double relief ended in 08/88.

Before this Lawson had carried out a currency fix with the Deutschmark
at around DEM 3 to the pound. This occurred from around 03/87 to 03/88
and resulted in base (and exchange) rates being lower than they would
otherwise have been.

So house price inflation was well and truly primed.

More info. here -
<URL:http://news.bbc.co.uk/1/hi/programmes/the_westminster_hour/1940421.stm>

Subsequently some fuckwit called Major carried out another currency
fix with the EMU between 10/90 and 9/92 resulting in base (and
exchange) rates higher than they would otherwise have been.

So house price deflation was well and truly primed.
thats right blame goold old John Major. the only decent PM we have had
in the past 30 years.
 
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D

Daytona

thats right blame goold old John Major. the only decent PM we have had
in the past 30 years.
Why do you think he's not to blame for this ?
 

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