| Topic: | Re:Re:Two Myths About the Housing Market | |
| Posted by: | Andrew Cumming | |
| Date/Time: | 06/01/15 10:21:00 |
| This doesn’t suprise me at all. But it does not really mean that things are all rosy. Around December 2013 I observed an absolute panic in my friends and colleagues of the ages 25-30. People love to state that the take up of Help to Buy in London has been so small as to be insignificant in terms of price rises. Unfortunately, the actual take up was irrelevant. The massive media coverage of the scheme accompanied by the apocalyptic messages of “buy now or be priced out forever”, “London is different”, “prices will go up by X amount over the next five years” messages sent people running cap in hand to their parents for as much as they could possibly get. Over the first 4-5 months of 2014 most of the conversation at my work revolved around the various terrifying mass viewings of squalid flats and how above asking price offers had been far outbid by more desperate buyers. I know of so many people over the last year who have jumped onto the “housing ladder”, stretching themselves to buy places that they wouldn’t have looked at before or that are unsuitable for them. A 35 year-old who wishes to have a family stretching themselves to buy a ratty one bedroom flat does not make much sense outside of a bubble environment. Remember, this rush to buy was not prompted by a massively recovering economy or by first time buyers getting richer, it was, in my opinion, the result of a carefully orchestrated political and media campaign to get homeowners feel richer and to tie more young people into the bottom of the ponzi scheme at any cost. You might say that 22% is not the end of days, but when you look at wage increase over the same period, or even since 2007, it is certainly scary. Average price to average wage ratios are already beyond sense and getting worse. Just my humble view from the front line. |