Wednesday, 20 November 2013

London bubble latest

In September I wrote:

"The Mystreet property price index (yes, literally the 40 homes in my street) has been predictably active lately. From a 2007 mean index base of 100, asking prices dropped to 94 with the crash. By last year, 2012, they were back at 100 and earlier this year one was sold at 104, marking a modest and realistic return of the market. This week, another's just sold at 115.5 - 15.5% above the 2007 bubble high, marking a new price-point for us all. This is now solid Foxtons territory. And it's a bubble."

Well, another one went in October for the same after just a few days on the market, and now an identical third has just gone on the market at an index of 121 - 21% above the 2007 high and last year's recovered price. 

How can we be so friggin stoopid? It's a bubble.


DeeDee99 said...

As far as Osborne and Cameron are concerned, it a nice little property boom in order to generate a more economic activity and a bit of a feel-good factor running up to the General Election.

Meanwhile, our young people trying to buy their first homes are seeing themselves either priced out of the property market or have to take on irresponsible levels of debt.

We'll all pay for it after the election.

Anonymous said...

The laws of supply and demand are at it again.

The previous glitch in the market was just that; a glitch and it was caused by an inability to borrow at the lower end.

No such thing up north though guys; I just bought a large two double bedroom apartment for £52K and spent £6K renovating it.

I have to say though that as a nation of property owners, the effect of housing ripples through our entire economy and thus we feel better and are better economically that our EU counterparts.

Coney Island

Budgie said...

I have to agree with Coney Island, it's only a London bubble at the moment. Also if we had no net immigration then prices would still be at the 94 mark, or lower, outside London.

Demetrius said...

If it not a bubble then it is the property market signalling a bout of hyper inflation, 1970's style but more dangerous. Other pre conditions are in place. All we need is some kind of added financial lurch or trigger. Perhaps like a government frantically buying votes to stay in power.