The reason for the laughter was a series of pictures underneath the title 'Nan and Pop are moving on' found on an estate agent's website....
(Oblongs of Anonymity added by Yours Truly)something tells me that these people are really keen on selling their place
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and whilst on the subject of property sales, a subject painfully close to my heart at the moment, a quick maths lesson for the prime minister and journalists...
- If a £100,000 property increases in value by 180% that property becomes worth £280,000
- To fall back in value to £100,000 that £280,000 property only has to lose 64% in value
That's the funny thing about percentages - the bigger the number you apply them to the bigger the result.
Most of the media coverage given to recent house price movements seems to be unaware of that little fact
...and it's also worth bearing in mind that a 2.5% fall in a month is equivalent to a 30% fall in a year
This may not come as a surprise to some but our Prime Minister is either innumerate, delusional or a deceitful sack of crap
Another interesting number quirk to bear in mind is that no-one in their right mind, unless they are in desperate need, is going to pay the current market price for a house or any other commodity if they think it is going to fall in value as soon as they've bought it. People are only going to be prepared to pay what they think the eventual bottom price is going to be, less a little bit more to be on the safe side. They are going to be aiming straight for the bottom price and not pissing around gradually paying a little less month on month
The upshot is that when commodity prices collapse, particularly prices driven up by insane levels of speculation, they collapse big and they collapse fast
...and any financial journo-whore who wrote over the last five years about the probability that houses prices would level off and 'plateau' should be given the boot - which would be pretty much all of them
...and as for the media whores parroting the new line which is now being spun, that house price falls are actually a good thing - as they make homes more affordable for first time buyers and reduce 'upgrade' costs for people already on the property ladder, they also need a damned good slapping
The consequence of a house price fall for anyone who has bought a home in the last five to ten years is that they owe a shit load of money to the banks which they'll be paying off for the next 20+ years for which they effectively received nothing in return
First time buyers are still going be locked out of the market by banks refusing them loans and preferring to punt all that public money the government has given them on the commodity and forex markets; effectively driving up the price of everything else except for houses. Potential first time buyers' jobs are also going to be at risk and their costs are also going to rise as a result of people who actually bought homes going to the wall and the impact that will have on the rest of us 'fortunate' enough not to go completely under
Everyone loses
Well, not quite everyone
.
27 comments:
it's making cogent arguments such as those that're keeping you from that financial analyst job you haven't been offered by newsmonkey organisations
bravo, Stef
if only we could take over the tv, we could loon up the world in mere minutes, in that, i have absolute faith
as it happens, I have, on occasion, earned the occasional crust doing some number crunching, though not for any newspapers
and the last time I looked at some real world property portfolios in a professional capacity I saw some really fucking scary concoctions - and that was four years ago
the typical return on a London rental property is something in the region of 4-5%pa gross.
Now that capital growth is a thing of the past and typical loan rates are 6.5%+ you'd have to turn 8-10% on a rental property for it to even start to make sense to hold one
which means that a London 2 bed property currently fetching £400k would have to fall in price to something like £250-300k to be a viable proposition
unless something very dramatic happens to prevent it, we're looking at 40% falls plus some chunky rent rises once the buy-to-let knob ends who thought they'd become zillionaires through subsidising their tenants are cleaned out of the system and, er, cleaned out
but in a system fine-tuned to keep the majority out of pocket there's very little chance all those folk who have been waiting to sign up for their first taste long-term banking serfdom will benefit in any significant way
and why bother faffing around with the property market when you can make a quick and easy 40% turn pricing brown people out of food?
"... when [house] prices collapse, particularly prices driven up by insane levels of speculation, they collapse big and they collapse fast ..." but with houses, if people don't have to move, they stay put. This has the effect of hiding, to a large extent, the collapse. Consequences are things like the perpetuation of the delusion and shills still exuding credibillity to naifs.
One point about the blog. Ball falling on zero ... inspired.
The house always wins...
but with houses, if people don't have to move, they stay put.
all the best serfs are immobile serfs
especially if they keep paying their tithes
CA Fitts is at it again. Former, U.S. Assistant Secretary of Housing and Urban Development and former managing director of Dillon Read is telling us about, "The Most Profitable Economic Hit in History" (follow links inside. She's quite cool, yeah?).
So Brown has just borrowed £120 for each of us, at interest, and called it a tax cut, making as much financial sense as paying off your mortgage with a credit card. Prudent indeed!
actually, paying off your mortgage with a credit card is an act of financial genius in comparison with what Brown is doing
Brown is now borrowing back some of the money the Government/BoE recently turned over to the banking system only at a higher interest rate
which is the same as lending someone fifty quid so that he can lend it back to you at a profit
Why don't the government tell the bankers to stuff their 30+ billion interest payments a year and fund all infrastructure projects using interest free government created money?
Because he would lose credibility with the interest bearing bank created money community.
Even the idea would prompt the negatives to be released, or he would come over all dead.
We must not tamper with the natural order of things unless it brings benefit to the few.
Witness the royal mail piratisation proposals, because they can't find a notional 2.6 bn for investment.
the reasons being given for the proposed privatisation do seem a tad spurious
the guy responsible for the privitisation proposal, Nigel Stapleton, was on the box last night and exhibited a veritable feast of subconscious physical 'tells' whilst he was reciting his bullshit
it does seem that the post office is consciously been destroyed doesn't it? I've lost count of the amount of times that I've heard talk of the Post office 'losing' a £100 million a year or not been profitable. Nobody has yet asked the obvious question - so what?
Why does the post office have to be profitable? It's a vital public service isn't it? All people want is a service where they can send a letter from anywhere in the UK to anywhere else for a flat fee. Post offices themselves are a vital social service especially in rural communities so what's the problem if they cost £150 million? By my calculation that's about 1% of what we've spunked out to bail banks out in the last year.
I mean nobody talks about prisons or hospitals having to be profitable do they...
I mean nobody talks about prisons or hospitals having to be profitable do they...
I know what you're saying but you might want to revisit and qualify that last thought
1% is near enough but if just count the recent £50bn bail out 0.3% is nearer
If you include Northern Rock it's something like 0.15%
alternatively, if you compare with interest payments on money the government could have just as easily printed itself rather than paying the banks £35bn a year to do it, it would be 0.4%
I'm still scratching my head at the breadth of this scam which has been perpetrated against the ordinary citizens of this Planet, puzzled not only by the boneheaded stupidity of many of the players but more so the shills in the press and media who so eagerly play their parts to perfection. Brown, first class fool or wicked henchman I just can't decide.
Why does the post office have to be profitable? It's a vital public service isn't it? All people want is a service where they can send a letter from anywhere in the UK to anywhere else for a flat fee.
It would be an interesting exercise to take apart and scrutinise all the operational components of a large bank and berate and punish it if any of the component functions weren't making a profit in their own right - its postroom, its employee toilets, air conditioning and heating systems, it's personnel/ office management/ marketing departments and so on
Obvious 'efficiency' improvements would centre on some kind of pay as you go system for all in-house interactions, including taking a dump, which would be administered by a fabulously complicated computer installation paid for by borrowing a heap of money from someone else
... and yes, I know, most big companies employ an internal recharge system but I'm picturing something altogether more fucked-up and unworkable, just like what's been inflicted on the ex-public sector
Unfettered free market = bad
Monolithic state = bad
Tony Blair style 3rd way shaft the taxpayer, enrich the private sector provide even worse service = bad
So is there a 4th way?
I personally doubt very much that the markets for the things we can't do without are 'free' in any meaningful sense of the word
What I see is a collection of oligopolies and monopolies constantly, and successfully, pushing for even greater concentrations of capital and power
I personally don't have a Utopian view of how a perfect society would be run but what I am certain of is that concentration of capital/power in the hands of a tiny few is the root cause of pretty much all the war, exploitation and general nastiness of the modern era
If the majority of people are to have anything like a reasonable future the malign influence of such a disproportionate concentration of influence has to be neutralised
At which point the rest of us should be able to hammer out some kind of compromise/ coalition between Leftist and Rightist viewpoints
An example of the kind of stupidity that bothers me...
There's been a lot of talk over the last year or two by Leftists about the need for Inheritance Tax as a tool for preventing social inequality
...and there is a very strong theoretical argument for that
There's also a strong conservative argument that if someone actually earns some money in their lifetime and chooses to pass it on rather than spend it that should be their choice
And round and round the debate goes
But the truth is that the really rich bastards who control things pay fuck all tax anyway. So even an allegedly redistributive system like the one we're are supposed to be living under today actually increases the concentration of capital - slapping down the middle tier whilst leaving the really rich bastards completely unscathed and, in effect, even more powerful
The Duke of Westminister is worth something like £7,000,000,000 (I'd a pick a Rothschild but no-one has the faintest idea what they're really worth)
So, hands up anyone, who thinks his beneficiaries are going to pay £3,000,000,000 in IHT when he pegs out
Id agree that land ownership is pretty much the only issue, however various distractions might convince us it isn't. Land owner ship is all that matters, economically, socially, politically.
And that facts speaks for themselves.99% of the population live on 7% of the land. <0.3% own 2/3rds of Britain. About 2000 families own 60% of Scotland. We live in middle ages serfdom, except its expertly packaged up as a liberal democracy.
All this bank, houses and market real world stuff is making my head spin. Besides, this blog is seriously lacking Freemason Bilderberg Kissinger Content.
Let's fill the gap:
Denver Airport Conspiracy Theory: A Documentary
Part 1, Part 2
Lest I forget: Pictures of the cosy atmosphere at Denver International.
@tony
lol
I have neglected the UFO/ Space Alien/ Bilderberg side of life too much recently. I'll see what I can do
Re. the DIA stuff
I've had the good/bad fortune to be stuck in DIA a couple of times and it is one seriously fucking weird place
though I'm not entirely convinced that this video is the production which will split the DIA story wide open
lines like...
'One fact must be questioned. Why is the underground base 88.5 square miles long?'
... mean that it's straight to the Conspiraloon Alliance blog for that particular piece of work
Another one for the Conspiraloon Alliance, this from The Times by ace reporter Def Leppard, "MI5 linked to Max Mosley sex scandal"
Yeah, but the house would do.
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