Double dip is surely on its way — simply in anticipation of the ConDem’s havoc about to be let loose on the economy.
House prices fall record 3.6% last month. The Halifax revealed the biggest monthly drop in 27 years as the number of houses for sale increases and demand dampens.
Be worried.
The chance that the private sector will get us out of the mess that Osborne is determined on delivering is zero. And it is pretty obvious that people already know it.
Most of all I feel sorry for all the personal tragedies that follow from this news, and will follow in due course — all of them avoidable.
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House prices are way overvalued. They would have fallen regardless of who is in power/what was done.
Is the vicious cycle beginning to turn?
Osborne ludicrously makes hundreds of thousands redundant. Houses have to be sold because mortgages cannot be paid. Vast over supply and no buyers triggers precipitous falls in prices. People are trapped and cannot move where the diminishing supply of jobs are. Demand collapses. People are made redundant….
This comment has been deleted. It failed the moderation policy noted here. http://www.taxresearch.org.uk/Blog/comments/. The editor’s decision on this matter is final.
It was potentially libellous
The fact is there is still enormous amounts of debt in the system – households, financial institutions and governments. Before that is cleared you will never see growth. You cannot keep spending your way out of debt. You cannot keep deferring the pain. We need to take it now.
I agree with Mike that house prices need to come down. However, I think the supply and demand situation will keep the prices up in the long term. Also there are few enough ways for individuals to save money. Pension schemes are all pretty rubbish.
There is still the view that houses are an asset. In anything other than a dysfunctional market, they would be a liability (speaking as a home-owner), given the expenses of maintaining them.
@Steve Coyle
Government debt is unlike personal debt
The two cannot be compared – except by economic simpletons like Osborne
We not only can spend out of recession – it is the only way out
And I think you’ll find Osborne might be saying that soon – because I bet they can’t find the cuts
@James from Durham
I hate to say this – but the only way out of this conundrum at the end of the day is wage inflation with house prices staying constant
@Richard Murphy
You will never have constant house prices with rampant wage inflation at the same time. Just not possible. If we had wage inflation every asset class would sky rocket.
Sorry Mr Murphy !
I’ll engage my brain next time.
@Steve Coyle
What’s your answer then?
Rampant wage inflation ?
Most of the people I know have had below-inflation increases for many years now.
I’ve no doubt that some have high increases in earnings, but I doubt that the vast majority would regard them as good, let alone rampant.