Generation rent, cost of living is so high it's impossible to save for a decent deposit, stuck in poverty for rest of your life unless the bank of mum and dad come into play
Will property prices keep rising? Yes. Simple answer. The UK property market is given anti-gravity powers by central and retail banks and Government housing and immigration policy. The supply is artificially squeezed, the amount of available lending is abundant and the number of people wanting to borrow to buy is ever growing. It's a pyramid scheme on which the nation is built. Next question.
Also big corps are buying them up as assets, they can afford the higher prices as the return will come over a longer time horizon. To compete with that we are now looking at multi generational mortgages. Land (that the property sits on) is a finite resource and therefore has no upper limit on its value. Having said that, the rate of growth will likely slow. One of the big drivers in house prices was it being normal for the majority women to work full time. This meant people were now competing with 2 salaries rather than one. We have likely seen that increase happen over a long time as first they joined the work force and then migrated from low paid jobs to more and more professional and executive roles, giving the couple much more money to compete for houses, hence driving the prices up. I don't t
I don't think you can import enough immigrants to offset the demographic decline. And if you did your country would resemble sub Saharan Africa, since that is the main source of the imports
@@Jaime-eg4eb I suspect that the declining birth rate is due to few people being able to afford a house until they are in the 30s and needing two wages to pay the mortgage then.
I live in a council house in a small rural village in Scotland. Would love to buy my own home and I have enough to do so, but everytime I run the numbers it puts me off. Currently paying
@@shabbos-goy9407 I'm investing the difference between what my rent is Vs what a mortgage would cost me as an extra into my portfolio. Equities will outperform houses IMO. So the money will be there if I need to buy a house. Alternatively, my portfolio should be able to fund my living costs including rent.
buying is always better in the long term. in the short term, yes - your mortgage might be bigger. but that mortgage will be roughly the same in 10 years... 20 years... ( actually, it normally gets lower as your equity gets larger). The rent at the same time? it'll be far higher. ...and, added bonus, you'll have a big chunk of capital if you can, then do it.
It's is simple laws of supply and demand that mean in the long term house prices and rents will continue to go up. Yes there will be dips here and there but the overall trend will be upwards. Housing is like anything else, if you have something that is high demand but low supply, then the price goes up. Sad truth is you can streamline planning all you like but there simply isn't the capacity in the house building industry to build enough new houses to even keep up with the increase in demand of an increasing population let alone tackle the backlog of the millions of homes we are already short of. We simply don't have the numbers of bricklayers, plumbers, electricians, carpenters etc to keep up with the demand for new houses. This means restricted supply of a thing in high demand. Hence the price goes up. A young work colleague of mine recently bought a small new build. It is costing him all but 50% of his net wages per month just in mortgage repayments. People are just going to keep extending themselves further and further to get on that first rung of the housing ladder.
They need to solve the supply problem. In the 1950s the got industry to churn out pre-fabs. In some places like Ipswich they are still seen as desirable residences.
@@MrDuncl yes, on the continent they use prefab much more, but it’s seem as less desirable here and building regs are mostly against them. They could change the regs but then the traditional builders would lose out as houses would be imported. Maybe there has been lobbying to prevent this. The old bricks and mortar houses seem too good and in America, many houses are timber. With good fire protection these are viable in the U.K. also. So a house that lasts 50 to 100 years from timber should be considered. Most flats are steel frame with brick clad and this is another option for houses that can utilise a cheaper prefab construction. There’s no way the Gov will build enough houses the traditional way
The supply is artificially restricted by people purchasing multiple properties as assets. This means those with capital squeeze those without. Restrictions/Dissincentives could be introduced to make multiple property ownership unattractive as an investment, increasing supply and reducing costs.
I think you missed the point of the video Stuart. It's not about whether prices will continue to trend up, barring any significant market corrections of course they will, and the video doesn't suggest otherwise. It's about the rate at which they trend up, and whether it's reasonable to expect the performance of the past 70 years to be matched over the next 70 years. And the simple answer is it pretty much can't possibly happen unless wages somehow rise astronomically.
In real terms, UK house prices have gone sideways since 2000. Prior to that, the growth was on the back of increased availability of finance and more dual income households.
Really brilliant work as always Damo. I’m starting to understand things a lot more now. Just recently bought my home and I didn’t do it to make money I bought it because rents and landlords are seriously taking advantage of renters. I also did it so that I know I have relative security. The reason this is a thing - Is people can’t afford to have kids anymore. Children a very expensive and younger generations don’t want to have children to give them a crappy standard of life. Unless prices come down. It’s just going to stagnate all round.
I think a good personal example is my parents were interested in buying a holiday home in wales in the 1990s which was 40,000, which was is a lot of money. Although below their yearly combined wage. Now that same property is worth 270,000 pounds and is over double their combined wage and they are both in higher positions in their respective employment than they were back then. Of course them missing out on a holiday home is much less of an issue than the locals who will not be able to afford anywhere around there. Reducing the number of local people which strains the local economy massively and a much worse quality of life for the propel who do stay.
I hate that way of framing the increase in property prices, it's so insincere. Inflation increased the property prices by ~30x in the past 70 years and 'real price change' increased them by a mere ~4x. You'll see the issue if you reverse the "Inflation accounts for £45.000 of the £242.000 house price"-statement, because by the same logic 'real price increase' would account for only £8.000 of the £242.000 house price (£242.000/30).
Supply and demand hasn’t changed. What has changed is the interest rate hike shock.. demand is pent up because buyers are waiting for the interest rate hike shock to come down. Once interest rates come down to a new level the demand will open up again and we will probably see a spike in house prices for a little while due to the pent up demand.
I was always baffled when I first came to London how low its overall skyline is given its size and population trends.Not a fan of the idea of living in a tower block for sure but even something a few storeys above the predominant terraced houses seemed like a trend begging to happen.
In central London there are very strict viewlines to avoid blocking historic buildings, that's why we have such funky shaped skyscrapers - all to avoid blocking viewlines. London also sits on, aptly named, London Clay, which doesn't lend itself to tall development without the use of piled foundations as clay can change volume through the year as moisture levels change so it would be really bad if your skyscraper started leaning because part of the soil has swollen in one area more than another. That's why most higher rise developments are generally either very high end, where the costs to build can be recouped, of further out of the city where planning viewlines aren't blocked
Rory and Alastair (Rest is Politics) have both agreed we need to be open to gentle density like our some of our European neighbours have been comfortable with for decades.
They are in some areas of London, although not improving infrastructure at the same time, so they are easing living pressure (often with build to rent so you can't either buy the home) but putting a strain on everything else. I'm more baffled by why they are allowing the population trends to happen in the grand scheme of things.
I'm a property owner but think it's incredibly unfair on the younger generation how it's almost impossible to buy a property if they are in average circumstances. Mass immigration has been a big mistake and successive Government's have failed the country by not having more family friendly policies to encourage a stable population. This constant obsession with national economic growth doesn't align with happiness. We are now seeing young people either living with their parents for longer and longer or having to spend most of their wages on rent and not being able to save for a home, it's just wrong.
I took a trip down memory lane this morning to confirm that 'She's Electric' by oasis is in fact the UB40 theme song from the 80's kids TV show 'You and Me'.
If we wanted to fix it we could stop taxing productivity and switch to land value tax to lower land price inflation, but we (collectively) don't, people want affordable housing AND property to build wealth, which are ultimately irreconcilable goals as it's a zero sum game which causes damaging boom and bust cycles (18.6 years on average as per Fred Harrison).
In spent 1989 to 1999 in a house that wasn't worth what I paid for it. It took Tony Blair promising "things can only get better" to break the eight year decline in prices. There is a huge amount of "positive feedback" in the housing market. If you don't understand "positibve feedback in a control theory sense look it up on Wikipedia. Interestingly the first photo in the article is a queue of people wanting to withdraw their money from Northern Rock.
Great vid. I bought my first place in Feb (lil 2 bed in the south) and have been really contemplating how different the future is likely to look compared to the last few decades. I think the boom is going to slow down somewhat. That being said, I'm immeasurably pleased I managed to snag my own place, as a single millennial no less. Ultimately, I always had the goal on the basis that I didn't want to be under the thumb of a Landlord, and that I'm building equity and that the money I pay every month is actually going somewhere.
I bought my house in 2005 and it has barely kept pace with inflation against the price I paid, let alone with the £120K of improvements I've done since then. However, my index fund portfolio has generated enough over that same period that I no longer need to work (and the mortgage is paid off). I never include the value of my house in my net worth calculation.
Many people still think houses are a great investment. Index funds have done far better for me. There is an element of opportunity cost in housing. Having a huge mortgage makes it hard for many to find money for investing in markets.
@@philipjamesparsons The issue is that no building society will lend against an index fund. In contrast in the noughties anyone with a £10K of savings was being bombarded with the idea of taking out a BTL mortgage and building up a property portfolio.
I'm currently looking for my first home and this is exactly the reason I don't want to clean out my investments and max out my mortgage. I'm going for a property price that's roughly half of what the bank will lend me, I'd rather use the rest of my income to overpay the mortgage and invest in an ISA. It baffles my friends who are in the same position and are now living paycheck to paycheck to pay their mortgage
I brought my house in mid 2002 when according to your chart was the crossover of house price rises and interest rates falling. I paid 100k and now worth 500k, nuts!
I was reading some historical document, in the 1600s where a local lord spared his carpenter for 6 weeks to build an entire mill by hand with a dozen labourers. Nowadays you couldn't build an extension in 6 weeks. To be fair the builders weren't have 6 tea breaks a day back then.
There's a lot of truth in this. Somehow despite all the modern tech, we've become slow and unskilled at 'real' jobs (i.e. not poncing about an office) compared to times-gone-by. It's crazy seeing what some of our ancestors were able to build without modern tech, and comparing it to the low-quality, mass market housing/buildings of today. I think a lot of it ties back to a general degradation of society, with everything today being about money and instant-gratification. There's relatively little pride or decency anymore in the trades, it's just about doing the minimum to turn the greatest profit, in my opinion.
Immigration is such a volatile topic right now, but these people who come over on boats end up living 12 to a room in a slum landlord property, not some newbuild 3 bed starter home. Any immigrants that do can obviously afford to, and therefore are contributing. But then try having that conversation with Reform voters.
Wow, talk about ignorant of the facts, explain then how in several places in the UK local councils have handed keys of new builds over to immigrants, stories are out there go look for yourself. Those that are coming over in boats are being housed in 3/4 star hotels at the cost of 15m a day, you must of missed that, not to mention someone i know in the military has told me army housing are being refurbed for these people too, nice reward for breaking the law eh, sets a nice image, break the law be rewarded, first impression of this country. 48% of immigrants are NOT working but claiming, fact, yea, maybe have a "conversation" eh.
Price is determined by supply and demand. Demand exceeds supply due to demographic growth ( 30% since early 1950’s) and housing stock is increased only by 1-2% pa. Therein lies much of the problem and we have a finite amount of land. Property prices increased dramatically from the 1980’s with the financial services revolution and the availability of credit unleashed then. Property inflation is quite separate from general inflation.
It's the corrupt system that means the issue with the trains hasn't been fixed yet.. UK taxpayer paying the train operating companies for lost profits during strike action? Laughable
Heavily skewed by London, the huge number of people coming into it, low unemployment, low interest rates and the lack of new land. Go elsewhere & you'll find house prices have dropped relative to wages. You can still buy a house in Sunderland for £20k.
@@MPD90 - Not much to live there. Rightmove have 3 bed houses for £10k. But I'd rather be there than some overpopulated s***hole in London at ten times the price.
I had a look and the Dow Jones Industrial index between 1952 and today is around x153 difference, not far from your x151 for UK house prices. Also I would say saving for a house deposit in a currency which is devaluing by the day is like trying to fill a bucket of water with a hole in the bottom, anyways good luck.
The uk is a finite land mass. We cannot just keep increasing population and houses indefinitely. Their always seames to be this push for growth. I feel stabilisation is what we should be aiming towards.
Silly comment! Whilst the UK has a finite land mass like everywhere else, we’ve currently built on less than 10% of it so there’s a lot of space! It’s just not in the interest of house builders to destroy their money making market. It’s always about money!
@@joey-pn3xe It is not just about building homes to house an expanding population. That extra population also needs schools, hospitals, power, water. And land to grow food on. My point is that permanent and constant growth is not a feasabul or sustainable long term option. not only in the UK also globally, permanent growth is not sustainable. Eventually their will be a crash.
@@catsmother4556 booms and busts are built into capitalist system. Unless as a country we want to try another way which no political party has suggested then we should expect booms and busts.
@@joey-pn3xe I agree boom and bust followed by boom and bust. Bust is no fun for the majority so perhaps we should try another way. And stop striving for a constant boom. Strive for balance instead.
What seems to be a big misunderstanding in my book is that the whole mess of housing and immigration is a revolving door, there was a huge increase in housing prices from around 1997 pretty much when Blair opened the countrys doors to mass migration. The huge increase in housing costs has completely put the younger generation off from having children due to the costs of living and being able to afford a home. Couples not wanting to start a family till they can afford a home but now instead of being able to afford a home in their early twenties they arnt able to buy a house until the mid to late 30s. So due to a high migration rate we now have a low birth rate, which in turn they say we need more migration for jobs. Basically the government havent got a clue what they are doing
idk this sounds like you did 2+2=3 when there are tons of reasons why people aren't having kids anymore. economy or not being able to support is one of them but it's not the definitive answer nor is migration entirely to blame. there are still plenty of people having children who rent, in contrast all my friends own properties and do not have children. people are more content without the stereotypical nuclear family and it tends to be the more well off and educated who are just now choosing to not have children, especially women established in their careers. by far the opposite in recent few decades lower classes in the UK have historically been the ones to have more children. migration for jobs has been a long running thing in the uk happening since wartime as opposed to some new phenomenon, there were periods before as you mention such as 1997 increase in migration, or 2009, etc that didn't stop people from having children so it is more just a general society shift though yes of course cost of living plays some minor role in it. it's just never that simple imo and it's easy to just blame migration for absolutely everything. but personally and speaking to my friends in my circles, it seems to be a similar general western world increase in less desire for families and children and women no longer wanting children (south korea is a good example) and us living in a more self sufficent society where we don't care about relationships anymore and just fending for ourselves. modern society has become less of a society and more 'selfish', which in turn results in more reclusivity meaning less relationships, less families, less desire for children, more desire to just exist individually.
I completely agree. In the 1970s a single wage doing something like plumbing was enough to buy a large house in an upmarket Bristol suburb and support a wife and four children. I have just described a schoolfriend's family but that was the norm back then.
I am an immigrant who lives in London, and considering to buy a house 2-3 years later but, nope, it's not possible to buy in London at these prices. So i think prices will go down, because it's too high for everybody right now.
As an American, I love your videos Damien. Even when your videos are specific to Europe, they are great. You are an amazing story teller. alright now F*** off I've given you enough praise.
I have several friends that live in Albuquerque, NM and home prices have increased 35-40% since 10/2020 and they are still going up! Also my niece lives outside Nashville and her house has increased in value by 4K in the past 2 weeks! When will this end?
Tax and insurance rate increases seem to be pushing investment homes back onto the market. All the profit from holding a rental property are being sucked away. Without cash flow, you'll be eager to get rid of the property now, while the prices are still relatively high.
If the U.S. expects countries to want to use the dollar and the U.S. Treasury we should stop weaponizing the current financial system. This is not in America's interest to do this without due process.
Consider diversifying your portfolio with a mix of stocks and stable assets. Seeking professional advice now could provide valuable insights and strategies to navigate market uncertainties and protect your investments.
No doubt being financially free and not having to worry much about health care and other expenses cannot be overemphasized, making smart plans and setting up diversified investment portfolios is quite essential.
If you had used 1kg bars of gold (instead of plastic blocks) , you would find a decrease: In 1970 then 10 bars of gold buys a house. In 1988 then 7 bars. In 2024 you would only need 6 bars to buy the same house! I am sure this would make a good broadcast for you. 😊
It ia all about timing, both gold and the stock market have been something of a rollercoaster....when you enter the market and sell is cherry picking. However imo gold today unlike many other assets looks a good long term bet.
I think you missing the point- many people not just can't afford to buy they don't want to buy overpriced crap! Half of what on sale is just unfit for human habitation! And the prices for simple homebase/b&q renovation and the labour is just ridiculous. Recently I found the 2 bed flat I can afford to buy but I was quoted £80k.for renovations and it's just killed the deal for me. Ripoff Britain...
Peas in my bowl, green and bright, They're like tiny investors, full of delight! I planned to save them, grow my stash, But they keep slipping away, like disappearing cash! 'Invest in peas,' they said with glee, But the property market's the place to be! The peas bought land and built a home, Now they’ve got equity in a garden dome! So next time you're cooking, think twice, please, Your next financial advisor might just be peas! (I had a chat with Ai) 🤣🤣🥰
Unfortunately the gov won't offer incentives for people to get into the trades. If instead of burdening the housing market with an influx of people they could be spending money on getting economically inactive citizens into the building sector.
The growth in house prices is behind other assets like gold. The house prices are highly dependents on their local economies. UK's productivity is behind other countries.
Growing the population by net migration of low skilled workers (this is not an insult, it’s a description, nothing dishonourable about it) will not solve future tax needs because great numbers of these are not net fiscal contributors. Need investment in technological solutions to deal with many of these issues instead.
Policy solution triple whammy is planning reform (time to Build), skills and training and a more sensible migration system. Then maybe houses will become homes again rather than speculative growth assets
In the 1970s two big concerns (often on the news) were "The Money Supply" and "The Brain Drain" (to places like the USA and Australia. They don't seem to be bothered about either now.
That is why capital gains tax is a con. No inflation effect is taken into account against the gain. I know we get an allowance per year, but they are still effectively stealing. That's why the ISA allowance is so important. Thanks for your videos. It's helped me educate myself on maintaining my wealth
Just saw a video on another channel about homes for sale in Italy, which showcased a 3-story townhouse in Abruzzo for 29k. It needed some plastering and a kitchen and bathroom fitted, but the price just seemed pea-nuts compared to UK house prices. I've long since given up the idea of getting on the housing ladder. It will really take a lottery win to make it a reality.
My dad bought his first home in 1954 for £200. Its now worth about £400,000. I bought my first home in 1989 for £30,000 then bought and sold for increasing values. 45k then 75k then 350k then finally 400k 8 years ago. You never loose with property on a lifetime journey. My advice. Buy what you can afford and build from there
As far as I can see, this is only heading one way: to a quasi-feudal renter system, with housing increasingly owned by a powerful few. In this case, corporate landlord companies. Blackrock in the US are already on the march, and Lloyds Bank are seeking to do this here. And, even if banks upped the lending amounts, I'm not sure I'd want to take it. Because, you still don't own anything, and owe everything. The only sign you should look for is houseprice-to-earnings ratios. Everything else is just a debt prison.
Wages have not stagnated since 2008. They've fallen sharply. They've stagnated only when tracked against inflation. But inflation does not include the rising price of purchasing a house outright, nor the rising price of land, nor the rising price of S&P 500 shares. Everything that constitutes actual WEALTH is conveniently excluded from the inflation calculation. Economists know this, but actively choose to use misleading terminology like 'stagnated' because they don't want transparency. They believe the system works in our best interests - despite it surreptitiously slashing our wages. They believe this system is threatened by an incomplete layman's understanding of it. They lie for our benefit as they slash our wages.
I am only 4 mins in but I hope you also mention the quality of houses too, the cheap lumber lego houses that are sold at a premium today boggles the mind. Hoping to buy a house in the near future when my gold/silver/btc allows but I won't be touching anything built after 1990
In regency novels, when somebody says "Lord D'arcey has an income of £2000 a year", they instinctively understood that was at an interest rate of 6%. And remember:- we had the gold standard so negligible inflation.
The level of intelligent policy change required from government to genuinely attempt to fix the hard problems that our society faces is way beyond the abilities of the modern political class.
I think one of the biggest problems is this country's obsession with home ownership. In a lot of the countries with the lowest expenditure on housing, it is rented from the government. We need to build more social housing but then not give people the option to buy it from the state. While this will increase the divide between home owners and renters, if you also introduce large inheritance taxes on housing which the government can then spend on buying more houses, eventually the problem will be reduced.
This will only change if rental costs are more reasonable. Every country that doesn't have an obsession with owning a property also has a heavily regulated, and fairer, rental market. Owning a home, even at these stupid levels, is still cheaper than renting in the vast majority of the UK
My dad made more money in property than he did in his whole working career. And he wasnt shy of working. Good news i guess. However something is wrong with that statement. They can't continue to rise like they have... enjoyed your vid
I got my mortgage in 2010 it was 152000 peas today it’s now at 326000 peas . Thankfully I used all my peas last years and paid the mortgage off . Now my peas are all mine.
@@DamienTalksMoney That remains to be seen. Once Council Tax morphs into a 'Property Value Tax' people will find that their peas come with a cost that they can't service. I wondered how they would take everybody's stuff off them by 2030. The path is now obvious.
I wonder if you could do the same math with our Salary. If things were to stay relative to the value of the house in the 50s. But also, can you really buy the SAME house? or is the wealth only every released when you sell the house you bought in the 50s, for 2000 pound for 250,000 pounds today? The same two bedroom house in the 50s today is valued at 250,000, so we're not really better off.Unless, we downgrade. Maybe inflation is only there to really inflate the government debt away. The national debt shrinks, but my house hasn't shrunk in size.•just the debt) Its still a 2 bedroom home, but now costs 250,000, and i still need two bedrooms.
Owning properties are just one of the best inflation hedges. We might not see the same growth, but inflation alone will make it worthwhile. If you can get a cheap enough loan inflation will diminish that loan in real terms over time too, so you make money by borrowing against your asset. There is risk in everything though, but I think properties in the UK are still a worthwhile part of an investment portfolio.
I so glad I went on an all out mission to buy as many small properties as possible 10 years ago up until covid struck when I backed off. I'm not sitting on a very healthy portfolio . If anything I'm very under leveraged but my appetite for risk has reduced dramatically. The world is a different place. I spend as little as possible on the property stock and am building up cash in various ways. Feel sorry for people trying to get on the ladder but...if they want to rent a house let me know 😅
I wonder how the UK housing market compares to France and Germany. After all, long term renting in France and Germany doesnt have that stigma like we do here in the UK
12 годин тому
Yes bit are we going to have inflation along with decreasing interest rates?
Ah perfect, just back from running an another great video! You just made my day Damien, I really enjoy how you break down different financial subject and also make all videos entertaining.
Nobody ever mentions that that there is a possibility of crime and riots and burned houses are even possible. Like people will just roll over and die. I just find it funny. Because it happened before like 50 times in last 2000 years. But in this predictions nobody ever even mentions this possibility.
Some factors missing are investments by private sector. John Lewis is building flats and Chinese corporations are starting to increase their portfolios.
The thing you don't get about inflation is that there is monetary inflation (increase in the number of monetary units) and price inflation (CPI and RPI indexes). But the monetary inflation is a river that meanders around the economy and bids up prices when it touches things. Most of the increase in monetary units comes from increases in credit and thus the things bought on credit will rise much much faster than the general price level e.g. cars and houses can go up 100% over the last 20 years while CPI (the general price level) only rises 70%. But in the past the gap was much bigger e.g. house prices doubled between 1969 and 1973 but the general price level rise was about 40%. High interest rates DID NOT stop lending and thus did not stop house price growth! Mortgage lending was out of control and it led to a massive banking crisis in the secondary banks. Thus 100% of the house price growth is a collapse in the purchasing power of the pound, it is just that price inflation in goods bought on credit is always higher than goods bought with savings because the credit goods are closer to the monetary spiget.
The growth in house prices and living costs in general vs wage growth has really pea'd me off.
Generation rent, cost of living is so high it's impossible to save for a decent deposit, stuck in poverty for rest of your life unless the bank of mum and dad come into play
He just straight up peas on his desk in this one 😂
HAHA!
Don't envy you having to clean up all those peas. But powerful demonstration
Thank you! Overall I think it was worth it
It pead me 😂
Will property prices keep rising? Yes. Simple answer. The UK property market is given anti-gravity powers by central and retail banks and Government housing and immigration policy. The supply is artificially squeezed, the amount of available lending is abundant and the number of people wanting to borrow to buy is ever growing. It's a pyramid scheme on which the nation is built. Next question.
Also big corps are buying them up as assets, they can afford the higher prices as the return will come over a longer time horizon.
To compete with that we are now looking at multi generational mortgages.
Land (that the property sits on) is a finite resource and therefore has no upper limit on its value.
Having said that, the rate of growth will likely slow. One of the big drivers in house prices was it being normal for the majority women to work full time. This meant people were now competing with 2 salaries rather than one. We have likely seen that increase happen over a long time as first they joined the work force and then migrated from low paid jobs to more and more professional and executive roles, giving the couple much more money to compete for houses, hence driving the prices up.
I don't t
I don't think you can import enough immigrants to offset the demographic decline. And if you did your country would resemble sub Saharan Africa, since that is the main source of the imports
@@Jaime-eg4eb I suspect that the declining birth rate is due to few people being able to afford a house until they are in the 30s and needing two wages to pay the mortgage then.
Klaus Schwab of Davos World Economic Forum says "you will own nothing and you will be happy."
Then why did we have crashes in the 1970s, 1990s, 2008/9 and now?
Love the commitment with the peas 🤣
i am still finding them
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Consider it a pod cast.
😂
lksMoney
What northern accent is this? It hilarious 😂 I am from Guildford
The production quality of your videos is peanominal and I look forward to you hitting 43m subs!
I just bought a house. But I hope to sweet jesus house prices come down. The UK cannot function properly like this.
Smashed it again Damo, there’s loads of videos on YT about property values but this one just pees all over them.
Labour talking about putting cap amount on Isas now. Dreading this budget in October
The pea centage rise in cost price! Love it
I live in a council house in a small rural village in Scotland. Would love to buy my own home and I have enough to do so, but everytime I run the numbers it puts me off. Currently paying
What happens when you retire?
@@shabbos-goy9407 I'm investing the difference between what my rent is Vs what a mortgage would cost me as an extra into my portfolio. Equities will outperform houses IMO. So the money will be there if I need to buy a house. Alternatively, my portfolio should be able to fund my living costs including rent.
buying is always better in the long term.
in the short term, yes - your mortgage might be bigger.
but that mortgage will be roughly the same in 10 years... 20 years... ( actually, it normally gets lower as your equity gets larger).
The rent at the same time? it'll be far higher.
...and, added bonus, you'll have a big chunk of capital
if you can, then do it.
@shabos in simple terms he'll be fcked
Buy that house mate And pay it off ASAP You should be much better off unless labour screw you over
It's is simple laws of supply and demand that mean in the long term house prices and rents will continue to go up.
Yes there will be dips here and there but the overall trend will be upwards.
Housing is like anything else, if you have something that is high demand but low supply, then the price goes up.
Sad truth is you can streamline planning all you like but there simply isn't the capacity in the house building industry to build enough new houses to even keep up with the increase in demand of an increasing population let alone tackle the backlog of the millions of homes we are already short of. We simply don't have the numbers of bricklayers, plumbers, electricians, carpenters etc to keep up with the demand for new houses.
This means restricted supply of a thing in high demand. Hence the price goes up.
A young work colleague of mine recently bought a small new build. It is costing him all but 50% of his net wages per month just in mortgage repayments. People are just going to keep extending themselves further and further to get on that first rung of the housing ladder.
Saves me writing this. Thanks 😊
They need to solve the supply problem. In the 1950s the got industry to churn out pre-fabs. In some places like Ipswich they are still seen as desirable residences.
@@MrDuncl yes, on the continent they use prefab much more, but it’s seem as less desirable here and building regs are mostly against them. They could change the regs but then the traditional builders would lose out as houses would be imported. Maybe there has been lobbying to prevent this.
The old bricks and mortar houses seem too good and in America, many houses are timber. With good fire protection these are viable in the U.K. also. So a house that lasts 50 to 100 years from timber should be considered. Most flats are steel frame with brick clad and this is another option for houses that can utilise a cheaper prefab construction. There’s no way the Gov will build enough houses the traditional way
The supply is artificially restricted by people purchasing multiple properties as assets. This means those with capital squeeze those without. Restrictions/Dissincentives could be introduced to make multiple property ownership unattractive as an investment, increasing supply and reducing costs.
I think you missed the point of the video Stuart. It's not about whether prices will continue to trend up, barring any significant market corrections of course they will, and the video doesn't suggest otherwise. It's about the rate at which they trend up, and whether it's reasonable to expect the performance of the past 70 years to be matched over the next 70 years. And the simple answer is it pretty much can't possibly happen unless wages somehow rise astronomically.
I cant comprehend the peasy mess you hsd to clean up. Youre srill going to find peas in thst room in a years time.
Great video!
Your content should be used in schools. Simple, engaging, spot-on economics.
In real terms, UK house prices have gone sideways since 2000. Prior to that, the growth was on the back of increased availability of finance and more dual income households.
Which is interesting, as rates were much higher during this period, then they were during 2000 to now.
We need to collectively and aggressively invest in uk based REITS, development and building companies. Money will flood to these companies.
Really brilliant work as always Damo.
I’m starting to understand things a lot more now. Just recently bought my home and I didn’t do it to make money I bought it because rents and landlords are seriously taking advantage of renters.
I also did it so that I know I have relative security.
The reason this is a thing - Is people can’t afford to have kids anymore. Children a very expensive and younger generations don’t want to have children to give them a crappy standard of life.
Unless prices come down. It’s just going to stagnate all round.
I think a good personal example is my parents were interested in buying a holiday home in wales in the 1990s which was 40,000, which was is a lot of money. Although below their yearly combined wage. Now that same property is worth 270,000 pounds and is over double their combined wage and they are both in higher positions in their respective employment than they were back then. Of course them missing out on a holiday home is much less of an issue than the locals who will not be able to afford anywhere around there. Reducing the number of local people which strains the local economy massively and a much worse quality of life for the propel who do stay.
I hate that way of framing the increase in property prices, it's so insincere. Inflation increased the property prices by ~30x in the past 70 years and 'real price change' increased them by a mere ~4x.
You'll see the issue if you reverse the "Inflation accounts for £45.000 of the £242.000 house price"-statement, because by the same logic 'real price increase' would account for only £8.000 of the £242.000 house price (£242.000/30).
Supply and demand hasn’t changed.
What has changed is the interest rate hike shock.. demand is pent up because buyers are waiting for the interest rate hike shock to come down. Once interest rates come down to a new level the demand will open up again and we will probably see a spike in house prices for a little while due to the pent up demand.
I was always baffled when I first came to London how low its overall skyline is given its size and population trends.Not a fan of the idea of living in a tower block for sure but even something a few storeys above the predominant terraced houses seemed like a trend begging to happen.
One issue is how wet the ground is I think whereas newyork is built on very hard rock
In central London there are very strict viewlines to avoid blocking historic buildings, that's why we have such funky shaped skyscrapers - all to avoid blocking viewlines.
London also sits on, aptly named, London Clay, which doesn't lend itself to tall development without the use of piled foundations as clay can change volume through the year as moisture levels change so it would be really bad if your skyscraper started leaning because part of the soil has swollen in one area more than another. That's why most higher rise developments are generally either very high end, where the costs to build can be recouped, of further out of the city where planning viewlines aren't blocked
Rory and Alastair (Rest is Politics) have both agreed we need to be open to gentle density like our some of our European neighbours have been comfortable with for decades.
They are in some areas of London, although not improving infrastructure at the same time, so they are easing living pressure (often with build to rent so you can't either buy the home) but putting a strain on everything else. I'm more baffled by why they are allowing the population trends to happen in the grand scheme of things.
I'm a property owner but think it's incredibly unfair on the younger generation how it's almost impossible to buy a property if they are in average circumstances. Mass immigration has been a big mistake and successive Government's have failed the country by not having more family friendly policies to encourage a stable population. This constant obsession with national economic growth doesn't align with happiness. We are now seeing young people either living with their parents for longer and longer or having to spend most of their wages on rent and not being able to save for a home, it's just wrong.
Holy balls a Poddington Peas reference. Core memory unlocked.
turns out there was only ever a handful of episodes each 5 mins long. I watched them all while making this video!
I took a trip down memory lane this morning to confirm that 'She's Electric' by oasis is in fact the UB40 theme song from the 80's kids TV show 'You and Me'.
If we wanted to fix it we could stop taxing productivity and switch to land value tax to lower land price inflation, but we (collectively) don't, people want affordable housing AND property to build wealth, which are ultimately irreconcilable goals as it's a zero sum game which causes damaging boom and bust cycles (18.6 years on average as per Fred Harrison).
In spent 1989 to 1999 in a house that wasn't worth what I paid for it. It took Tony Blair promising "things can only get better" to break the eight year decline in prices. There is a huge amount of "positive feedback" in the housing market. If you don't understand "positibve feedback in a control theory sense look it up on Wikipedia. Interestingly the first photo in the article is a queue of people wanting to withdraw their money from Northern Rock.
The commitment to this video!!!!!!!!!!!!!!
And all in all Equates to massive wealth inequality
Great vid. I bought my first place in Feb (lil 2 bed in the south) and have been really contemplating how different the future is likely to look compared to the last few decades. I think the boom is going to slow down somewhat. That being said, I'm immeasurably pleased I managed to snag my own place, as a single millennial no less. Ultimately, I always had the goal on the basis that I didn't want to be under the thumb of a Landlord, and that I'm building equity and that the money I pay every month is actually going somewhere.
I think that a 1950s house should cost around 45 to 60k. House prices are overvalued.
I bought my house in 2005 and it has barely kept pace with inflation against the price I paid, let alone with the £120K of improvements I've done since then.
However, my index fund portfolio has generated enough over that same period that I no longer need to work (and the mortgage is paid off). I never include the value of my house in my net worth calculation.
Many people still think houses are a great investment. Index funds have done far better for me. There is an element of opportunity cost in housing. Having a huge mortgage makes it hard for many to find money for investing in markets.
@@philipjamesparsons The issue is that no building society will lend against an index fund. In contrast in the noughties anyone with a £10K of savings was being bombarded with the idea of taking out a BTL mortgage and building up a property portfolio.
I'm currently looking for my first home and this is exactly the reason I don't want to clean out my investments and max out my mortgage. I'm going for a property price that's roughly half of what the bank will lend me, I'd rather use the rest of my income to overpay the mortgage and invest in an ISA. It baffles my friends who are in the same position and are now living paycheck to paycheck to pay their mortgage
You had your finger on the pulse with this one.
I brought my house in mid 2002 when according to your chart was the crossover of house price rises and interest rates falling. I paid 100k and now worth 500k, nuts!
That fine! But if you want to buy something bigger you be looking at 700k+ more debit and longer to pay it off 😂
Not nuts, but peas 😂
Damiem your videos are always gold mate. Fantastic production value.
Jesus must be kicking himself now for not getting in on UK houses way back then.
🤣
I keep telling my family and friends.. it's not that your home value has gone up, it's the purchasing power of your currency has gone down.
I was reading some historical document, in the 1600s where a local lord spared his carpenter for 6 weeks to build an entire mill by hand with a dozen labourers. Nowadays you couldn't build an extension in 6 weeks. To be fair the builders weren't have 6 tea breaks a day back then.
There's a lot of truth in this. Somehow despite all the modern tech, we've become slow and unskilled at 'real' jobs (i.e. not poncing about an office) compared to times-gone-by. It's crazy seeing what some of our ancestors were able to build without modern tech, and comparing it to the low-quality, mass market housing/buildings of today. I think a lot of it ties back to a general degradation of society, with everything today being about money and instant-gratification. There's relatively little pride or decency anymore in the trades, it's just about doing the minimum to turn the greatest profit, in my opinion.
Are you talking about asking price or sold prices?
Immigration is such a volatile topic right now, but these people who come over on boats end up living 12 to a room in a slum landlord property, not some newbuild 3 bed starter home. Any immigrants that do can obviously afford to, and therefore are contributing. But then try having that conversation with Reform voters.
Wow, talk about ignorant of the facts, explain then how in several places in the UK local councils have handed keys of new builds over to immigrants, stories are out there go look for yourself. Those that are coming over in boats are being housed in 3/4 star hotels at the cost of 15m a day, you must of missed that, not to mention someone i know in the military has told me army housing are being refurbed for these people too, nice reward for breaking the law eh, sets a nice image, break the law be rewarded, first impression of this country. 48% of immigrants are NOT working but claiming, fact, yea, maybe have a "conversation" eh.
@@leejames1792- could you provide some evidence/ sources to these claims?
Wasn't expecting Damien to say "I've got P's". Damien roadman arc foreshadowing.
Price is determined by supply and demand. Demand exceeds supply due to demographic growth ( 30% since early 1950’s) and housing stock is increased only by 1-2% pa. Therein lies much of the problem and we have a finite amount of land. Property prices increased dramatically from the 1980’s with the financial services revolution and the availability of credit unleashed then. Property inflation is quite separate from general inflation.
It's the corrupt system that means the issue with the trains hasn't been fixed yet.. UK taxpayer paying the train operating companies for lost profits during strike action? Laughable
Heavily skewed by London, the huge number of people coming into it, low unemployment, low interest rates and the lack of new land. Go elsewhere & you'll find house prices have dropped relative to wages. You can still buy a house in Sunderland for £20k.
where in sunderland?
Good luck with that gaff😳
@@drifterdude9823 -Go onto Rightmove & you'll even see 3 bed houses for sale at £10k.
People pay money to live in Sunderland? I always assumed it was like a mining camp sort of situation where they put you up while you dig?
@@MPD90 - Not much to live there. Rightmove have 3 bed houses for £10k. But I'd rather be there than some overpopulated s***hole in London at ten times the price.
I had a look and the Dow Jones Industrial index between 1952 and today is around x153 difference, not far from your x151 for UK house prices. Also I would say saving for a house deposit in a currency which is devaluing by the day is like trying to fill a bucket of water with a hole in the bottom, anyways good luck.
The audio quality on this video is amazing well made video mate
This makes me happy thank you!
The Poddington Peas theme tune is a banger!
The uk is a finite land mass. We cannot just keep increasing population and houses indefinitely. Their always seames to be this push for growth. I feel stabilisation is what we should be aiming towards.
Planet earth is a finite land mass. We cannot just keep increasing population and houses indefinitely. Mars anyone? 😋
Silly comment! Whilst the UK has a finite land mass like everywhere else, we’ve currently built on less than 10% of it so there’s a lot of space! It’s just not in the interest of house builders to destroy their money making market. It’s always about money!
@@joey-pn3xe It is not just about building homes to house an expanding population. That extra population also needs schools, hospitals, power, water. And land to grow food on.
My point is that permanent and constant growth is not a feasabul or sustainable long term option. not only in the UK also globally, permanent growth is not sustainable. Eventually their will be a crash.
@@catsmother4556 booms and busts are built into capitalist system. Unless as a country we want to try another way which no political party has suggested then we should expect booms and busts.
@@joey-pn3xe I agree boom and bust followed by boom and bust. Bust is no fun for the majority so perhaps we should try another way. And stop striving for a constant boom. Strive for balance instead.
What seems to be a big misunderstanding in my book is that the whole mess of housing and immigration is a revolving door, there was a huge increase in housing prices from around 1997 pretty much when Blair opened the countrys doors to mass migration. The huge increase in housing costs has completely put the younger generation off from having children due to the costs of living and being able to afford a home. Couples not wanting to start a family till they can afford a home but now instead of being able to afford a home in their early twenties they arnt able to buy a house until the mid to late 30s. So due to a high migration rate we now have a low birth rate, which in turn they say we need more migration for jobs. Basically the government havent got a clue what they are doing
idk this sounds like you did 2+2=3 when there are tons of reasons why people aren't having kids anymore. economy or not being able to support is one of them but it's not the definitive answer nor is migration entirely to blame. there are still plenty of people having children who rent, in contrast all my friends own properties and do not have children. people are more content without the stereotypical nuclear family and it tends to be the more well off and educated who are just now choosing to not have children, especially women established in their careers. by far the opposite in recent few decades lower classes in the UK have historically been the ones to have more children. migration for jobs has been a long running thing in the uk happening since wartime as opposed to some new phenomenon, there were periods before as you mention such as 1997 increase in migration, or 2009, etc that didn't stop people from having children so it is more just a general society shift though yes of course cost of living plays some minor role in it. it's just never that simple imo and it's easy to just blame migration for absolutely everything. but personally and speaking to my friends in my circles, it seems to be a similar general western world increase in less desire for families and children and women no longer wanting children (south korea is a good example) and us living in a more self sufficent society where we don't care about relationships anymore and just fending for ourselves. modern society has become less of a society and more 'selfish', which in turn results in more reclusivity meaning less relationships, less families, less desire for children, more desire to just exist individually.
Bit simplistic that, have house prices not risen in counties with lower levels of migration?
I completely agree. In the 1970s a single wage doing something like plumbing was enough to buy a large house in an upmarket Bristol suburb and support a wife and four children. I have just described a schoolfriend's family but that was the norm back then.
Reverse unskilled immigration, wages will rise, house prices growth will slow.
I am an immigrant who lives in London, and considering to buy a house 2-3 years later but, nope, it's not possible to buy in London at these prices. So i think prices will go down, because it's too high for everybody right now.
It’s never gone down in the long term so it’s highly unlikely to go down.
As an American, I love your videos Damien. Even when your videos are specific to Europe, they are great. You are an amazing story teller. alright now F*** off I've given you enough praise.
Nice use of the Hanz Zimmer method of music
“Stinks of pea” got me too 😂
Damien, you've got to focus on how Government is causing "shortages & price hikes" failure to do this, misses the Elephant in the room
Prices will continue to decline for the next several years. Reversion to the mean is in progress and of course human greed.
I have several friends that live in Albuquerque, NM and home prices have increased 35-40% since 10/2020 and they are still going up! Also my niece lives outside Nashville and her house has increased in value by 4K in the past 2 weeks! When will this end?
Tax and insurance rate increases seem to be pushing investment homes back onto the market.
All the profit from holding a rental property are being sucked away. Without cash flow, you'll be eager to get rid of the property now, while the prices are still relatively high.
If the U.S. expects countries to want to use the dollar and the U.S. Treasury we should stop weaponizing the current financial system. This is not in America's interest to do this without due process.
Consider diversifying your portfolio with a mix of stocks and stable assets. Seeking professional advice now could provide valuable insights and strategies to navigate market uncertainties and protect your investments.
No doubt being financially free and not having to worry much about health care and other expenses cannot be overemphasized, making smart plans and setting up diversified investment portfolios is quite essential.
I hope your channel grows just as property prices have grown 🎉
If you had used 1kg bars of gold (instead of plastic blocks) , you would find a decrease:
In 1970 then 10 bars of gold buys a house.
In 1988 then 7 bars.
In 2024 you would only need 6 bars to buy the same house!
I am sure this would make a good broadcast for you. 😊
It ia all about timing, both gold and the stock market have been something of a rollercoaster....when you enter the market and sell is cherry picking. However imo gold today unlike many other assets looks a good long term bet.
Fake gold
It's completely irrelevant. Why look at the value of one particular asset when you can look at the economy as a whole?
To count out 43337 peas just for a video is unbelievable Damien, you’ve took it a level above this time 😏❤️
I welcome this very human perspective in a finance-focused channel.
I think you missing the point- many people not just can't afford to buy they don't want to buy overpriced crap! Half of what on sale is just unfit for human habitation! And the prices for simple homebase/b&q renovation and the labour is just ridiculous. Recently I found the 2 bed flat I can afford to buy but I was quoted £80k.for renovations and it's just killed the deal for me. Ripoff Britain...
It will only go down if people begin to leave the country
That's the fundamental that can't be addressed as long as people scream racism at everybody who states it.
Or (better for the country as we need people) build more houses
I agree. Seems the censor doesn't like my comment on the fact.
@@Sammy-qt9it Nonsense. Low skilled immigrants, whether illegal or legal, cost us dearly in more ways than purely financial.
@@Sammy-qt9it Ok bro lets build 500k homes a year
Peas in my bowl, green and bright,
They're like tiny investors, full of delight!
I planned to save them, grow my stash,
But they keep slipping away, like disappearing cash!
'Invest in peas,' they said with glee,
But the property market's the place to be!
The peas bought land and built a home,
Now they’ve got equity in a garden dome!
So next time you're cooking, think twice, please,
Your next financial advisor might just be peas!
(I had a chat with Ai) 🤣🤣🥰
Recently bought a house in Wigan so appreciate the Wigan reference!
Unfortunately the gov won't offer incentives for people to get into the trades. If instead of burdening the housing market with an influx of people they could be spending money on getting economically inactive citizens into the building sector.
The growth in house prices is behind other assets like gold. The house prices are highly dependents on their local economies. UK's productivity is behind other countries.
Growing the population by net migration of low skilled workers (this is not an insult, it’s a description, nothing dishonourable about it) will not solve future tax needs because great numbers of these are not net fiscal contributors. Need investment in technological solutions to deal with many of these issues instead.
Policy solution triple whammy is planning reform (time to Build), skills and training and a more sensible migration system. Then maybe houses will become homes again rather than speculative growth assets
Have you ever considered that there is another agenda for this low skilled immigration? It's not always money.
@@JW20236 bingo, totally another agenda, amazed so many can't grasp it yet.
In the 1970s two big concerns (often on the news) were "The Money Supply" and "The Brain Drain" (to places like the USA and Australia. They don't seem to be bothered about either now.
That is why capital gains tax is a con. No inflation effect is taken into account against the gain. I know we get an allowance per year, but they are still effectively stealing.
That's why the ISA allowance is so important. Thanks for your videos. It's helped me educate myself on maintaining my wealth
Then go buy a property in Timbuktu for no CGT.
Just saw a video on another channel about homes for sale in Italy, which showcased a 3-story townhouse in Abruzzo for 29k. It needed some plastering and a kitchen and bathroom fitted, but the price just seemed pea-nuts compared to UK house prices. I've long since given up the idea of getting on the housing ladder. It will really take a lottery win to make it a reality.
Finaly someone telling the truth whats really driving house prices !
I’ve never thought of Rise and Peas in this way before.
My dad bought his first home in 1954 for £200. Its now worth about £400,000. I bought my first home in 1989 for £30,000 then bought and sold for increasing values. 45k then 75k then 350k then finally 400k 8 years ago. You never loose with property on a lifetime journey. My advice. Buy what you can afford and build from there
*lose
Heeey, i also like that APY calculator. Use it every week to marvel at the power of compound interest.
What a peafect example of property value increases …
Just put my property back on the market. Now priced at more than 10% cheaper than last year.
Make babies, people! Your country needs you!
What?
@woooooooo9061 - Watch the video, then it should make sense :P
Need a house first. Not going to have kids if I'm renting
@danuk500 - As someone who has had two kids while renting, I think you have a good plan there
As far as I can see, this is only heading one way: to a quasi-feudal renter system, with housing increasingly owned by a powerful few. In this case, corporate landlord companies. Blackrock in the US are already on the march, and Lloyds Bank are seeking to do this here. And, even if banks upped the lending amounts, I'm not sure I'd want to take it. Because, you still don't own anything, and owe everything. The only sign you should look for is houseprice-to-earnings ratios. Everything else is just a debt prison.
houses are not selling at asking prices in berkshire - they are trying but they are reduced before they sell
Wages have not stagnated since 2008. They've fallen sharply.
They've stagnated only when tracked against inflation. But inflation does not include the rising price of purchasing a house outright, nor the rising price of land, nor the rising price of S&P 500 shares. Everything that constitutes actual WEALTH is conveniently excluded from the inflation calculation.
Economists know this, but actively choose to use misleading terminology like 'stagnated' because they don't want transparency. They believe the system works in our best interests - despite it surreptitiously slashing our wages. They believe this system is threatened by an incomplete layman's understanding of it.
They lie for our benefit as they slash our wages.
While there is supply and demand imbalance and lenders tripping over themselves to lend, prices will likely inflate over the long term.
The cleanup 🙈 fair play damo!!
I am only 4 mins in but I hope you also mention the quality of houses too, the cheap lumber lego houses that are sold at a premium today boggles the mind. Hoping to buy a house in the near future when my gold/silver/btc allows but I won't be touching anything built after 1990
Oh yeaaaah living in the dark blue 🫨😂
In regency novels, when somebody says "Lord D'arcey has an income of £2000 a year", they instinctively understood that was at an interest rate of 6%. And remember:- we had the gold standard so negligible inflation.
Check out the price of houses in ounces of gold and it is much more stable.
The level of intelligent policy change required from government to genuinely attempt to fix the hard problems that our society faces is way beyond the abilities of the modern political class.
I think one of the biggest problems is this country's obsession with home ownership. In a lot of the countries with the lowest expenditure on housing, it is rented from the government. We need to build more social housing but then not give people the option to buy it from the state. While this will increase the divide between home owners and renters, if you also introduce large inheritance taxes on housing which the government can then spend on buying more houses, eventually the problem will be reduced.
The UK population has an unfathomable obsession with home ownership as opposed to just living in a home. "My home is my castle" and all that stuff...
This will only change if rental costs are more reasonable. Every country that doesn't have an obsession with owning a property also has a heavily regulated, and fairer, rental market. Owning a home, even at these stupid levels, is still cheaper than renting in the vast majority of the UK
Podington peas theme returning to live rent free in my head for the foreseeable is what I’ve taken from this. 😂
My dad made more money in property than he did in his whole working career. And he wasnt shy of working. Good news i guess. However something is wrong with that statement. They can't continue to rise like they have... enjoyed your vid
A-peas-e me here had me rolling 😂
I got my mortgage in 2010 it was 152000 peas today it’s now at 326000 peas . Thankfully I used all my peas last years and paid the mortgage off .
Now my peas are all mine.
No one can take away your peas!
a pea is £1000, I think your math may need work or you have the most expensive home in the world
You need more peas.
Good for peas of mind.
@@DamienTalksMoney That remains to be seen. Once Council Tax morphs into a 'Property Value Tax' people will find that their peas come with a cost that they can't service. I wondered how they would take everybody's stuff off them by 2030. The path is now obvious.
I wonder if you could do the same math with our Salary. If things were to stay relative to the value of the house in the 50s. But also, can you really buy the SAME house? or is the wealth only every released when you sell the house you bought in the 50s, for 2000 pound for 250,000 pounds today? The same two bedroom house in the 50s today is valued at 250,000, so we're not really better off.Unless, we downgrade. Maybe inflation is only there to really inflate the government debt away. The national debt shrinks, but my house hasn't shrunk in size.•just the debt) Its still a 2 bedroom home, but now costs 250,000, and i still need two bedrooms.
Owning properties are just one of the best inflation hedges. We might not see the same growth, but inflation alone will make it worthwhile. If you can get a cheap enough loan inflation will diminish that loan in real terms over time too, so you make money by borrowing against your asset.
There is risk in everything though, but I think properties in the UK are still a worthwhile part of an investment portfolio.
Mad lad just launches thousands of peas on his desk to make a point. Gonna be finding them for years mate!
Had to be done. Anything for the content
I so glad I went on an all out mission to buy as many small properties as possible 10 years ago up until covid struck when I backed off. I'm not sitting on a very healthy portfolio . If anything I'm very under leveraged but my appetite for risk has reduced dramatically. The world is a different place. I spend as little as possible on the property stock and am building up cash in various ways.
Feel sorry for people trying to get on the ladder but...if they want to rent a house let me know 😅
Great video mate!!! 🙏
I posted several comments whilst watching …..only to delete again as you covered them 😂
I wonder how the UK housing market compares to France and Germany.
After all, long term renting in France and Germany doesnt have that stigma like we do here in the UK
Yes bit are we going to have inflation along with decreasing interest rates?
Ah perfect, just back from running an another great video! You just made my day Damien, I really enjoy how you break down different financial subject and also make all videos entertaining.
Is it fair to say that house prices have grown massively, or is it more accurate to say that UK wages have completely stagnated?
Wow you actually killed it this time fair play mate great job as always
Thank you
You'd think that with an ageing population there would be an abundance of properties becoming available to negate the need to build new housing.
Nobody ever mentions that that there is a possibility of crime and riots and burned houses are even possible. Like people will just roll over and die. I just find it funny. Because it happened before like 50 times in last 2000 years. But in this predictions nobody ever even mentions this possibility.
And when the riots are over, what then? Nothing will have changed.
Some factors missing are investments by private sector. John Lewis is building flats and Chinese corporations are starting to increase their portfolios.
The thing you don't get about inflation is that there is monetary inflation (increase in the number of monetary units) and price inflation (CPI and RPI indexes). But the monetary inflation is a river that meanders around the economy and bids up prices when it touches things. Most of the increase in monetary units comes from increases in credit and thus the things bought on credit will rise much much faster than the general price level e.g. cars and houses can go up 100% over the last 20 years while CPI (the general price level) only rises 70%. But in the past the gap was much bigger e.g. house prices doubled between 1969 and 1973 but the general price level rise was about 40%. High interest rates DID NOT stop lending and thus did not stop house price growth! Mortgage lending was out of control and it led to a massive banking crisis in the secondary banks. Thus 100% of the house price growth is a collapse in the purchasing power of the pound, it is just that price inflation in goods bought on credit is always higher than goods bought with savings because the credit goods are closer to the monetary spiget.