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London property the most overvalued in the world watch

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    http://www.bbc.co.uk/news/business-34676643

    Some notable points;
    Real house prices, after adjusting for inflation, have soared by almost 40% in London since the beginning of 2013.

    The decoupling of the London market is "even more drastic" considering that real average earnings have fallen by 7% since 2007.

    The demand for London properties was largely driven by foreign investors, but domestic buyers have also helped to boost prices.
    UBS said the government's Help to Buy scheme had stoked demand too.

    On past experience, UBS said that a price correction of 30% usually occurs within three years of the index exceeding a score of 1.0. London is at 1.88(see article for what this means and how it is calculated).

    In my view properties should not be an investment for foreign owners or buy to let landlords. A home is a home, a nessecity. Being able to make huge profits out of housing is no different to making huge profits out of food. And again in my view another area that shows the Tory myth of the "party of working people".

    Working people are being hammered because of this. The already very wealthy are milking the working people. A party of working people would see those who are working and not see them give 50% or more of their salary each month to a person who is doing no work to collect the rent. And yet still Tory policy is one of do nothing about rising house prices, as if working people weren't being fleeced enough already.
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    Well,I would hope most people would agree with you.

    But the question is what can be done about it?

    The good news is that houses in the suburbs will now likely only go up 3 or 4 % a year for the next few years.

    But the prices are of course ridiculous already.

    I actually cannot for the life of me understand why anyone who doesn't earn or expect to earn £100,000 would live in London.

    The quality of life for those not on the housing ladder is ****.

    In fact I read an article in the Standard just a few weeks ago where a journalist was pointing out that even talented young people are leaving in droves and that something must be done.

    But what? As far as I can see its way too late for anything to be done.

    And the political problem is that people already on the housing market simply aren't inclined to vote for anything likely to lead to a fall in prices.

    The housing market in this country is the underlying cause of many of the other problems in this country.

    Yet there is little political will to do anything about it.Mainly because a buoyant housing market tends to help parties win elections and boosts the economy ( no **** Sherlock)


    Politicians argue about how much someone is to receive in their pay packet yet the real issue is the cost of houses compared to which ones net income is of little consequence.

    The elephant in the ( rented) room.
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    if foreigners will pay more than you to live in London, why complain?
    its a free market.
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    (Original post by JeremyOU)
    if foreigners will pay more than you to live in London, why complain?
    its a free market.
    Many of them aren't actually paying for houses in order to live in London.

    (Why would they when they are rich enough to live in far nicer places?)

    They are buying houses in London because prices are increasing due to it not being a fair market.
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    (Original post by moggis)
    Many of them aren't actually paying for houses in order to live in London.

    (Why would they when they are rich enough to live in far nicer places?)

    They are buying houses in London because prices are increasing due to it not being a fair market.
    theres nothing unfair about it. London is the most successful banking and investment capital in the world, many people have second homes or investments here, as well as living or staying here. London gives financial stability and security to those property owners.
    as for nicer places, feel free to think of some.
    and anyway, those with money can live in london, those without money can live in spain/russia/republic of congo/china. or wherever the people with the money came from.
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    (Original post by JeremyOU)
    theres nothing unfair about it. London is the most successful banking and investment capital in the world, many people have second homes or investments here, as well as living or staying here. London gives financial stability and security to those property owners.
    as for nicer places, feel free to think of some.
    and anyway, those with money can live in london, those without money can live in spain/russia/republic of congo/china. or wherever the people with the money came from.

    As far as I can tell your second sentence is a non sequitur isn't it?

    But no matter. My posts are littered with them.

    When I use the word unfair I'm referring to the housing market in this country.

    It is most certainly not a free market by the strictest definitions of a free market.*

    I'm not inclined to give all the reasons because many of them should be obvious for one reason .

    Just one though.The issue of the green belt and of brown belt sites.

    Anyone who owns a house in the green belt is going to very determinedly oppose any change in the law with regard to use of the green belt.

    But even when builders find sites that are suitable for housing, the residents ,who naturally are all home owners, protest and too often succeed in preventing any building from being carried out.Or force the building of fewer properties.

    Now this isn't really an issue in London of course but it is exacerbated by foreigners being allowed to buy houses in London and by private landlords buying up houses.


    The fact is supply cannot keep up with demand, while those who own property do all they can to prevent anything from being done about it.


    As for me listing places that are nicer than London I would have though that the fact that many houses in London are unoccupied would suggest that the owners have found somewhere better to live.
    Of course they may just want to be near their mothers in some cases.....


    * I confess that I made a calculated guess there.I stand to be corrected . ( Unlike house prices)
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    (Original post by moggis)
    As far as I can tell your second sentence is a non sequitur isn't it?

    But no matter. My posts are littered with them.

    When I use the word unfair I'm referring to the housing market in this country.

    It is most certainly not a free market by the strictest definitions of a free market.*

    I'm not inclined to give all the reasons because many of them should be obvious for one reason .

    Just one though.The issue of the green belt and of brown belt sites.

    Anyone who owns a house in the green belt is going to very determinedly oppose any change in the law with regard to use of the green belt.

    But even when builders find sites that are suitable for housing, the residents ,who naturally are all home owners, protest and too often succeed in preventing any building from being carried out.Or force the building of fewer properties.

    Now this isn't really an issue in London of course but it is exacerbated by foreigners being allowed to buy houese in London and by private landlords buying up houses.


    The fact is supply cannot keep up with demand while those who own property do all they can to prevent anything from being done about it.


    As for me listing places that are nicer than London !i would have though that the fact that many houses in London are unoccupied would suggest that the owners have found somewhere better to live.
    Of course they may just want to be near their mothers in some cases.....


    * I confess that I made a calculated guess there.I stand to be corrected . ( Unlike house prices)
    the government still cant build enough houses they wont even recognize the issue.
    when saying how nice London is, i was really talking about the multi-million pound mansions, rather than than crappier parts.
    (the housing market is by definition a free market, remember a free market is not to be confused with a fair market.)
 
 
 
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