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That's not true, certainly not in the south east. The bubble never burst here, house prices have been growing faster than inflation for decades. Politically it
by eterm 11y ago
That's not true, certainly not in the south east. The bubble never burst here, house prices have been growing faster than inflation for decades.
Politically it is now impossible to let it burst, so all sorts of schemes are made up to keep it going.
Edit to add: a typical 2 bedroom terrace or end of terrace now costs between £350-500k ($500-700k) here. These are not large homes, don't have luxurious gardens, don't have a garage at all. This isn't even London, this is just outside London in the south east. And wages haven't kept up.
Imagine San Francisco house prices without San Francisco wages, that's why people are talking about a generation of renters.
- mjevans 11y agoThis concisely points out exactly why we never recovered from the great recession of our time. It is politically beneficial to obey the rich paying for their campaigns, and placate the voters, then to deliver the harsh correction for bad behavior that a controlled lancing of the bubble would involve.
- deleted 11y ago[deleted]
- objclxt 11y ago> Imagine San Francisco house prices without San Francisco wages, that's why people are talking about a generation of renters. As someone who lives in both cities, I can assure you that San Francisco is measurably worse. Before I moved here from London I didn't think that was possible. Directly comparing the advertised prices of housing in London and SF is misleading, because houses in SF in most cases are being sold above their sticker price, whereas that's still very uncommon in London. It is not unheard of to pay a 30% premium on the price the seller has put the house on for in SF. For renters London also isn't nearly as bad: for comparison - an average one bed rent in SF is $3,500 per month [1], whereas in London even in central areas like Bloomsbury it's $2,500 per month (£1700). This is not to detract from your argument, and SF also has a "generation rent" problem (as does the rest of the bay area). But London's market is more comparable to New York in terms of prices and pressures - both cities have a housing crisis, but one that is at least partly tempered by more supply and a far superior transport network than SF. SF is in an insane world of its own. [1]: http://www.sfgate.com/bayarea/article/San-Francisco-rent-cost-drop-rental-6690357.php http://www.sfgate.com/bayarea/article/San-Francisco-rent-cos... [2]: http://www.londonpropertywatch.co.uk/average_rental_prices.html http://www.londonpropertywatch.co.uk/average_rental_prices.h...
- eterm 11y agoAnd now compare average software developer salaries between London and San Francisco, you'll find the SF one about 50% more. I'm not sayin that SF, or NY doesn't have a housing crisis, they have their own problems too. But the problem or rather the solutions required are different in each case. I don't think it is OK to hand wave it away with "it is OK just buy the crash" as someone further up did.