So he spends most of the article praising to the heavens the virtues of high house prices. Then at the end he suggests maybe though we should aim to stabilize house prices. Won't "stagnant" house prices undo much of the social good he ascribes to high house prices? Anyhow, so all you have to do to stabilize house prices is just to build more. That's it. Because undersupply is the only thing causing rapid property price increases, amirite?
Like many talking heads, he sees inflation as a real increase in wealth. As does 90% of the population. My Brother in law for eg sees his house price inflation as real 'earned' wealth of which he is entitled to spend on boats and cars via MEW, not understanding that he has just taken out a new loan for these toys, actually to the point of wanting a fist fight with me when I explained the realities of it. Hence we have a 'wealth' effect with this form of inflation. I suggest we are bringing the future forward with a 'spending' effect which is always good for the incumbent politicians and their masters, the bankers.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?
The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly. Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
My Brother in law for eg sees his house price inflation as real 'earned' wealth of which he is entitled to spend on boats and cars via MEW...
Yeah that is dumb. When I was a kid I thought to myself "what's the point of your house price going up? So you'll have more money when you sell it, houses everywhere else will have gone up in the meantime, and so after you buy your next house you'll end up no better off."
Of course there's a little more too it. You can take a mortgage out on your house, but only safely if you treat it like a loan you'll be able to pay off with your wages (unlike your BiL). Or you can bet on property prices going up at different rates in different location (risky). But I think the basic principle still applies.
On the contrary, he in fact has been in many fist fights over the years whereas I have had none since school even though I have done 20 years of martial arts as a hobby. I am very diplomatic but just having a conversation with you on the forum is impossible without you being insulting, he also cant have a conversation without getting aggressive. I, in fact am a very amiable people person, not just a blunt stupid idiot as per yourself.
Yeah that is dumb. When I was a kid I thought to myself "what's the point of your house price going up? So you'll have more money when you sell it, houses everywhere else will have gone up in the meantime, and so after you buy your next house you'll end up no better off."
Of course there's a little more too it. You can take a mortgage out on your house, but only safely if you treat it like a loan you'll be able to pay off with your wages (unlike your BiL). Or you can bet on property prices going up at different rates in different location (risky). But I think the basic principle still applies.
Partially true.
Every suburb and street is different. You might be able to sell your house for a 50% profit then buy again in a nearby suburb which has only increased by 20% or it may have fallen in value resulting in you having a much smaller mortgage or a much larger house and land for a similar sized mortgage.
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