UK House Prices – The Psychology of Boom & Bust Cycles
09. Dec, 2009 
25 Comments
Psychology drives all markets. Gordon Brown’s miracle ‘no more boom & bust’ economy is a myth. Boom & Bust has been a factor of all business cycles for over 600 years. Housing Markets run in 18 year cycles. Music by maddo & packham. … house prices price property uk england boom bust crash housing bubble mortgages interest rates business rightmove crunk
BTW, not sure if you are aware, but Eddie George (former Gov of the Bank of England) has since admitted that they (the BOE) deliberately fueled a consumer boom (which in turn fueled the housing boom) in order to keep the economy going.
I have links to the actual select committee minutes to the meeting where he admits this in the vid info of my video:
housepricecrash – The Movie Pt.1 – Starring Krusty All Slop (AKA Kirsty Allsop)
On my other channel, FreeBrunoPowroznik
Well by theory I meant the theories & rhetoric spewed by the media & other vested interests in keeping the property boom going (Economists, Govt, etc) that prices would continue rising forever & it would be supported by an almost endless period of economic growth.
very useful thankyou
maddohartlepool however at the end you say reality replaces theory
what do you mean by this??
Downturns typically last as long as the boom. But it all depends on what happens inbetween now and then in terms of state intervention.
If they decide to hyperinflate the major currencies and/or start another war it could be decades of hard depression for most of the anglosphere. A fall from grace into the third world norm.
You’d either have to be borderline genius or completely misguided to predict the global economic future at this time.
Kool Video…….
anyone care to venture a guess at when things will start to at the least stablise from feb 2009?
Heres a WDGann man, love to get hold of your data source if its available, not many people appreciate that the future is but a repetition of the past. My interest is commodities but real estate is just the same animal.
There have been 5 depressions in the last 400 years the quickest return to house price values(pre crash) has been 36 years.
here are the time scales for house prices to return to pre depression peaks after each depression 36,36,38,54,and 90 years.
UK house prices will not return to 2007 highs until 2043 at the earliest (my guess will be more like 2055) UK house prices will fall 65-70% minimum, no one will believe it
The power & privelege of the rich elites is safe, as long as we – the people – don’t realise that they stole all our land (long before we were born) rendering us all landless peasants & are now renting or selling it back to ua in tiny little scraps at such high prices that we are forced to work 25-30 years hard labour on top of the fair amount of work we would have to do just to produce to consume & eat.
The value of land is kept artificially high by the fact that it was all stolen, with extreme force (before we were born), property laws were implaced to protect & keep the land in the hands of the few & a police force created to uphold the law with coercion.
In Britain, 0.6% still own 69% of the land! Basically, the same aristocratic families who owned it in the 1800’s & before.
Note that I put this video up in July 2007 before the crash, but it’s pretty much panning out as predicted.
Since 2005, the website housepricecrash has been predicting a credit crunch would trigger a recession & a crash in house prices. Something the media largely ignored.
In fact, the website got mentioned in the Times Online recently, in an article called:
Ten people who predicted the financial meltdown
search for it on google if you like.
The black up curve is based on av. house prices using Nationwide’s figures – adjusted for inflation. With the down curve (same black curve) based on predictions of falls based on the housing markets past performance in a crash.
The Red curve is a mean calculation of Above (showing what prices (values) would be without the distortion of speculation.
Are those curves based only on the current houses up for sale or all the houses in the country?
If only the old dirty houses remains, isn’t this curve going to decrease?
If the builder only built affordable houses during 3-4 years and no large expensive houses, isn’t this curve going to decrease?
The rise of housing costs is a story of the rise of land prices well documented but not well understood. The money supply issue is merely a detail in this larger picture. Houses do not go up in value, they depreciate. This is obvious especially when more can be constructed and the supply increased. The supply of land cannot be increased so its value has to go up when people think the value will continue to go up indefinitely. Land values are pushed up beyond real values and have to fall, kabust.
I thought your comments were Mad.. Then i read your name and my thoughts evaporated.
30 to 40% more falls to come over the next 2 years me thinks
Houses aren’t overpriced, you are just lazy. If you are working less than 60 hours a week, it means you are part of the nouveau leisure elite. Stop complaining about ‘high prices’ & get yourself another job!
We are currently experiencing the STR ‘bear trap’ phase of the housing cycle (the predictable dip in prices before the REAL boom starts).
Even when house prices are falling, they are still rising. Get another job, you lazy BTL wannabe!
Not really, actually its good for the market and good for the government. It’s people like me who also pay a big tax bill at the year end! All rental income as to be declared and tax has to be paid on profits.
its people like you who distroy the market for us lol
inflation helped ppl in those days, it ate the mortgage when you were getting 8/9/10% pay rises every year. inflation is kept supposidly under control therefore we all get 2/3/4% pay rises. I truly feel sorry for young couples (with kids)trying to start life with these bloody silly house prices. The only people who really win are the blood sucking estate agents and the government with stamp duty. good honest people always suffer when house prices go up or down
I dont assume, People who do buisness take risks, you have to – to make money. But you also have to be careful, not borrow to much. I know how much I can take out & what my risks are. About people leaving the country, if there leaving – then theres also people coming in. You also have the DSS contracts which pay good rent(I have many of these contracts – fixed for 3 years). I wont let my equity get eaten up, it wont happen. Thanks for your feedback.
your assuming you can keep these houses rented out. I think your going to have to reduce your monthly rental as time goes on. people are leaving the country, buy to let investors are going to find it harder to keep tenants who pay. remember we are only just a year in, we have at least another two years to go. your equity is also going to get gobbled up although I agree you are still likely to be in positive terrioritory. your gonna have to be very careful..all the best
No not really, beacuse I bought property for £40K – £50K about 6 years ago. They have equity well worth over 65% taking into account the price fall. You see landords with a strong foundation who started early (like my self) about 12 years ago. Still wont lose. You just hold onto the property and you still have your rental income (providing you fixed the rates accordingly). If people wont buy now, then they will have to rent. Which is good news for landlords, even though rents are not going up.
I think your in for a bit of a shock.