The reason for the confusion about the housing market is not just because asking prices are being conflated with sale prices in reports, but because many people – individuals and businesses alike – do not want to confront the economic reality of slowing house price inflation, falling house prices, higher mortgage rates and rising inflation.
At present, sellers are in a standoff with reality and are reluctant to adjust their expectations. But the truth is that a fall in house prices is probably the best possible outcome for the housing market. It would undo the extreme inflation we saw during the pandemic and make homes a bit more affordable again.
British people, like British banks, have become addicted to rising house prices. I always like to point out that theitself notes that “when house prices go up, homeowners become better off and feel more confident” which makes them spend and borrow money and keeps the world of financial services turning. That is why politicians always try to boost the housing market in troubled times with measures such as stamp duty cuts.
Victoria_Spratt ipaperviews Supply and demand. Massive shortage of housing, no shortage of buyers. I feel reports of a downturn may be premature or at least shortlived.
Victoria_Spratt ipaperviews Buy a bank.. They’re going cheap..
Victoria_Spratt ipaperviews Yes, now we can barely afford to live we should definitely stop investing in property.