No Cash

Yes I am really interested if you could tell what problems there will be when incomes are pegged with inflation.

Please don't just bring examples like Weimar Germany or Zimbabwe who had war reparations to pay and trade sanctions against them respectively.

Obama did print money and gave it to citizens with his stimulus even if the sums involved were quite modest.

http://www.rightmove.co.uk/property-for-sale/property-40222388.html

There you go, a three bedroom house for under £80,000, and there are many cheaper than that.

Our average couple could afford to buy lots of the properties on the market.

And remember our lesson about averages, there are many couple getting far more than the average wage who could afford to pay a deal more.

Gas Panic

I agree with you house price inflation is something we need to tackle urgently as well.

The thing is this phenomenon is not recent and has been repeating it self for the past 40 years no government has done anyhing about it.

The average home according to the ONS used to cost £5K in 1970 and it quadrupled to £20K in 9 years!!!

It trebled its value again in 11 years when it stood at £60K in 1990. After the crash it only increased modestly to £76K in 97

The prices again trebled in the next 10 years to £223K in 2007.

The state need to make the banks lend more sensibly and reinstitute rents control and perhaps ban interest only mortgages in order to limit the increase the prices of the BTL market as well.

Agree with Ronnie on most of this.

Interest only mortgages are a time bomb waiting to explode.

So are PFIs.

So are our Pension schemes.

So is Power Supply. Centrica have pulled out of the plan to build new generators, can't agree "terms" with the govt.; the French company EDF are the only players left so much for competition. If they pull out we are struggling.


I remember when North sea Oil was discovered; it was going to set us up, 40 years later we are not only heading for a power crisis , we have spent the income and another trillion on top.

I remember when North sea Oil was discovered; it was going to set us up, 40 years later we are not only heading for a power crisis , we have spent the income and another trillion on top.

Yes Mister E, an island with its foundations built on coal and we've got an energy crisis.

You'd think it would take a genius to manipulate us into that situation.

The words of Aneurin Bevan.

Boris
Printing the money and giving say £100K to each and every citizen to repay the banks for the endebted or spend/invest for those who were prudent seem to me to be the milder pill for everyone to swallow.

Just a few small points I need to clarify, starting with the £100,000. Let's say they buy apartments in Spain, Portugal or France. How does this help our own economy?

What if the immigrants send it back to their families in the country of their birth. How does this help our economy?

I would be interested to know why you think that a trebling of house prices in the last 10 years has been a good thing?

RR's very much like Rumpelstiltskin - then he woke up!

I would be interested to know why you think that a trebling of house prices in the last 10 years has been a good thing?


Trebling of house prices in the last ten years eh?

Did you just invent that figure for your argument hoping that it would pass as fact?

There is NOTHING GENUINE about you REAGAN!!!!!!!

and on the day some BofE idiot wants NEGATIVE interest rates, in a nation of interest only mortgage property speculation, to suggest there is no excessive fuelling of a housing bubble is just being a flatearther. 

i wish some of these people would answer honestly that on the wages they would be on today in the roles they had back then, could they afford the same house today they bought on those wages in the 1970s, 80s, 90s. 

if they were working in the south east, starting out now, how would their route to property ownership run.

Another way to look at the rise in house prices in comparison with wages, is not that property prices have outstripped labour, but that UK labour is now worth far less than it was back then.

I’ll certainly go along with that looking at the dopes that we now produce in comparison to the cheap labour that is flooding in from the EU.

I am presuming the stats are taken from a bigger source than Shanelee's road.

can you give us an idea of what you earnt to afford the 90k, and what you think that same salary would be now?  that is the key question shane.

and look at the comparison with 1998.

2003 things were overheating then, late 90s were the last time a healthy market existed, not driven by investors and the odd buyer fuelled by property porn.  2003 greenspan was at his height of cheap credit, and assume you limeys were in on it as well.

.
http://www.ft.com/cms/s/0/f269df52-251d-11e2-86fb-00144feabdc0.html

I found the above article a bit of an eye-opener, especially the comments.
There is no repayment action on over half of the loans in London and the South.

I disagree with Reagan as to whether interest-only should be barred. If an adult wants to walk along the edge of the cliff we should let them however unwise. Putting down around 25% deposit and effectively paying rent to the bank after that seems a common option. In a free market interest-only should be allowed to exist provided everyone knows the risks and there's no bailouts or subsidies offered. Sadly, there is - it's called London rates of Housing Benefit.

Subsidies bugger everything.

Our economy is helped so far as most people will have most of their debts written off hence they will have higher disposable income and demand will sky rocket since they won't need to service a huge mortgage or credit cards.

Boris

I'm beginning to warm to your idea.

1. I act irresponsibly and amass debts of £100,000.
2. I wait for the Government to come along with a printing press. They print £100,000 to pay off my debt.
3. I act irresponsibly and amass debts of £100,000.
4. I wait for the Government to come along with a printing press. They print £100,000 to pay off my debt.
5. I act irresponsibly and amass debts of £100,000.
6. I wait for the Government to come along with a printing press. They print £100,000 to pay off my debt.
7. I act irresponsibly and amass debts ................................

boris, if this is a windup, you are failing miserably. If it isn't, it's making you look like a complete fool.

I don't think that there is a single poster on here that hasn't piped up with some sort of example/explanation on how your suggestion is massively naive (if not downright idiotic) yet you keep repeating the same childish idea over and over and over and over again, as if you hadn't even read what others said, and as if by repeating it, it would make it good.

Let me sum it up for you. Your suggestion is stupid. Move on.

thank you shane.  honesty from a great man, cutting the bollockios.

so house has increased by 50% and earnings by 2%, or declined if, as seems to be so widespread in the uk males of a certain age seem to have adopted a low paid, subsistence self employment existence.  a third world solution to work as a nation marches towards poverty.

so a house on 2 x joint income (and 4.5 x sole income) has increased to 3 x joint income and more pertinently to me 7 x sole income, and thus unaffordable for the latter.

people on AVERAGE salaries on their OWN could afford average houses in the 1990s and first year or so of the last decade, and it is denying it to say otherwise.  as they should.  who should buy average homes if not those with average earnings?  it is not to be for those speculating on geared investments or lottery winners. 

your example shows this, and the statistics shows this is close to the norm.

it is not DEMAND or WAGES keeping these prices high.  it is a turgid, non moving low transaction market with prices kept high by those that should be struggling bailed out and subsidised by tax credits, housing benefit or low interest rates.

Forgive me people for politically i am young and naive.. BUT

Considering under 2% of UK land is built on.. why can we not build more houses thus lowering the price + creating jobs in the process?

(I know that the 2% figure isnt reliable i.e lots of land not suitable etc) but still a substantial amount to be built upon.

?

what does it come too?

^Gotcha. n1