Comments on: How To Avoid Boom and Bust in Housing Market http://www.mortgageguideuk.co.uk/blog/uk-housing-market/how-to-avoid-boom-and-bust-in-housing-market/ Simplifying Finance, Housing and debt Thu, 18 Mar 2010 06:56:59 +0000 http://wordpress.org/?v=2.9 hourly 1 By: Monevator http://www.mortgageguideuk.co.uk/blog/uk-housing-market/how-to-avoid-boom-and-bust-in-housing-market/comment-page-1/#comment-1907 Monevator Sat, 29 Nov 2008 15:17:32 +0000 http://www.mortgageguideuk.co.uk/blog/?p=371#comment-1907 Some thoughtful ideas, but I think you need to look again at some of your assumptions. For instance, it's a myth that there was (or is) a huge shortage of UK property. If there was, rents would have increased hugely throughout the boom, as well as house prices. In reality, rents were largely static for most of the boom, or increased only moderately, despite large levels of inward migration, and set against the 300% increase in house prices in some areas. In reality, there was a *perceived* shortage of investable UK property (whether by owners or landlords), due to unrealistic expectations about future returns in property. In other words, house prices completely uncoupled from the underlying fundamentals, based on greedy (in the economic sense) expectations. Some thoughtful ideas, but I think you need to look again at some of your assumptions.

For instance, it’s a myth that there was (or is) a huge shortage of UK property. If there was, rents would have increased hugely throughout the boom, as well as house prices.

In reality, rents were largely static for most of the boom, or increased only moderately, despite large levels of inward migration, and set against the 300% increase in house prices in some areas.

In reality, there was a *perceived* shortage of investable UK property (whether by owners or landlords), due to unrealistic expectations about future returns in property.

In other words, house prices completely uncoupled from the underlying fundamentals, based on greedy (in the economic sense) expectations.

]]> By: Housing Market » Blog Archive » Government Policies for Housing Market http://www.mortgageguideuk.co.uk/blog/uk-housing-market/how-to-avoid-boom-and-bust-in-housing-market/comment-page-1/#comment-1904 Housing Market » Blog Archive » Government Policies for Housing Market Fri, 28 Nov 2008 10:52:27 +0000 http://www.mortgageguideuk.co.uk/blog/?p=371#comment-1904 [...] See: How To Avoid Boom and Bust in Housing Market [...] [...] See: How To Avoid Boom and Bust in Housing Market [...]

]]>