Who is to blame for UK housing market decline?

Question

I would say home owners being greedy, wanting unrealistically high and unsustainable prices, estate agents encouraging silly prices to get bigger commissions, banks being greedy knowingly lending people more than they can reasonably afford. All bubbles are destined to burst.

Answer 1

I fully agree with you. But this is all about human nature and business,  we act differently during good and bad time. We often forget that bubbles are destined to burst. This is a good question.

Answer 2

House prices were far too high, but it is wrong to put it all down to greed.

The main problem has been Brownian tax policy.  Golum Brown has turned pension plans and saving accounts into bad investments. Because of this everyone has been looking to invest into a limited property market.  Also as prices looked like they were rising beyond what people thought they would ever be able to afford, some people panic bought.

It is not in estate agents interest for prices to be too high. Agents want sensible prices, because that's when there are the most transactions.  Better to sell 2 homes for 150k than one for 200k.

Answer 3

Blame the French! mwaahahaha

Answer 4

Those that pushed it up to ridiculous levels in the first place. The Government for setting a low inflation target for the BOE to track, as well as using a totally unrepresentative measure. (CPI) This allowed the BOE to lower interest rates for along time to historic lows. ergo, this allowed the irresponsible bonus chasers in the lending institutions and equally feckless borrowers to drive up debt and house price to crazy levels. This occurred in this country and the US, and even the Government joined in on a borrowing binge. Leveraged buyouts were also a part of the overall problem.

Others involved were the buy to let merchants, estate agents, the TV media for their endless property programs.

The lending institutions were able to access almost endless foreign money via the 'money market' and were lending on ridiculous multiples of salary. Of course, whilst all this was going on, the Government look good on the back of a booming economy. All on borrowed money of course. Bubble has burst and Browns chickens have stopped laying eggs. It was always going to happen.

Answer 5

you, and the amount of credit you took on...!!

Answer 6

Why ask a question that you've already answered ?.

Answer 7

Probably the large business owners. They have been taking up lots of land to build more offices, and that is making supply go down. This makes the house prices go up, thus making less people buy houses.

Answer 8

bin laden: 9/11 > interest rates go down >real estate bubble ;) but bubble is worldwide, not merely in the UK - and, there were others in the past (last one bursted in the early '90)

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i did not mean to be ironic nor offensive: this is the story of economics! 9/11 risked to unleash a rough recession, towards this risk interest rates were reduced... and this is the origin of the housing bubble...

Answer 9

Look in the real world.

Who's creating false hope out there in time?

After hitting the head of the young one with the Book of the Dead?

Being "Reincarnated" like the dead Mummy of failures and horrors of the past?

Creaking and rattling with empty skeleton of skull and bones with two empty eye sockets?

Living in misery like cave-men from the twilight zone in different time zone?

How do we expect the dead Mummies from the twilight zone to survive in the real world in different time zone?

So who's been building pyramids without a solid foundation in time?

Did'nt anyone teach them  the "Rule of 72"

In growing with growth of population with time.

Not "Money,money,money"

Just "All for the money"

Who got buried under the pyramid schemes in time.

What a fantastic toy-land with all the match-box toy cars we have out there in wasting unnecessary wastage of natural resources in plundering, looting with destruction of God's natural assets with two empty hands passing by as time-traveler in time.

Sure?

We are the Son of God?

Not Son of a dirty old man from someone else graveyards in kicking the butts of God in not worshiping God in time with self lack of knowledge in creating own misery out there in time.

Luke 8.5-8,10-17

Luke 9.25,55-56,60

Luke 6.39-40,41-45,46-49

Matt 22.32

1 Timothy 6.7

What do you think?

Answer 10

George Bush.

Answer 11

It is not declining, it is rebalancing to a more affordable level.

Answer 12

The housing market has continual ups and downs. On average since 1950 house prices have doubled every 8 years. If you draw a graph you see that the market tends to go 10-15% above the line and then corrects. It always over corrects to about 10% below the line then starts going up again.

The market reached the 15% overpriced and started falling, so there is still probably 10-12% to go down before it picks up again. The only thing that varies really is the time it takes to correct to the right level. Once you see the average it gives you a very good idea of the best time to buy.

If you sold now and rented for around 18 months you could probably lock in a very nice profit!