UK house prices have risen by 81pc since early 2009, with regular weekly wages rising by just 3.4pc when adjusted for inflation during the same period.
Are those house prices also adjusted for inflation or not? That is, is that a fair comparison or not?
Are there still unions in the private sector? I thought they’d all moved to the bottomless pit/trough that is the public sector. Interesting concept and I’d love to hear the thoughts of the ghosts of the Labour founders. Campaign for your members to be paid more and campaign for the government to steal more of their money.
Still, with all that campaigning the union bosses have even more excuses for not doing any work…
As long as they can sell houses the prices are right. There is no specific link between house prices andv wages because most buyers have a house to sell. Only first-timers are constrained primarily by income. Anyhow, prices are right for current levels of moderate supply and unconfined demand but don’t mention the I word.
The answer to Tim’s question is “of course not”. Comparing inflation-adjusted #’s to unadjusted, income to wealth, pre-tax to after-tax, who’s got time to worry about getting such things “right”?
Curious, though, how the errors always run in the direction of making the story more dramatic.
Not adjusted for inflation:
https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/latest
Sep 07 £190,032
Mar 09 £154,452 – someone has arbitrarily chosen the bottom of the trough to exaggerate
Dec 23 £284,697
BoE inflation calculator is 52.7% from 2009 to 2023.
The prices are a bit schit though, size of the houses is schit and their locations. You will be allowed though to stay in and smoke. Schit.
It’s the Terriblegraph discussing numbers.
Here’s a zinger from the same source earlier in the week on the rise in the cost of Fish & Chips:
“The rise in prices spiked in 2022 after the cost of living crisis caused energy costs to rocket”
Oh and also:
“Inflation and soaring costs of potatoes and fish brought about by climate change and the war in Ukraine are partially to blame”
Maybe they really were surprised by Biden’s debate performance
It’s the Terriblegraph discussing numbers.
That rag seems to have degenerated from employing thick posh monkeys to hiring actual monkeys. They seem utterly bewildered by the concept of cause and effect.
The housing market coverage is particularly laughable. Innumeracy prevents them from coming up with anything serious, so we get estate agent’s press releases and crash/crisis hysteria in equal measure.
Also, they don’t understand investment yields, so you get occasional articles saying the best place to invest in property is some sink estate in Sunderland…..
Why would you want to adjust house prices for inflation? They are inflation.* You might as well take the “basket of goods & services” & knock the inflation rate off the current prices to prove you haven’t got inflation.
*Mostly, of course, they’re credit creation. With an adjusted 3.4% rise in earnings it can’t be where they money’s come, can it?
I once sat down to review how we came to be in our present financial condition (i.e. not remotely rich nor even “well off” but comfortable, given our fairly frugal life, unless/until “care” bills come along).
The two main components were (i) both getting into the housing market at OK times, and (ii) some neat footwork involving pensions.
By comparison our earnings, including freelance earnings and merit payments from work, played minor roles, as did legit tax avoidance.
Somebody might say “Shame on you, a bloke of your abilities should have shown more ambition and made himself a heap of money”. Then I would bid him a hearty “fuck off”. I knew from childhood that the likelihood was that heaps of money would eventually be at risk of confiscation from socialist governments and trade unions. So there was a good case for instead doing something I enjoyed and accepting that pay in such professions is unlikely to be stellar.
A sensible policy we adopted was to ensure that the younger generation were well educated and understood the good sense of pissing off abroad.
You might say “Get a grip, you were over-reacting to the cast of mind of the post-war Labour government”. Maybe so but “The evil that men do lives after them”.
The biggest determinant of how large a house you can afford is how large a mortgage you can afford. When mortgage rates drop from double figures to low single figures, house prices will rise.