Tag Archives: house prices

Covid-19 should stop the government’s house price subsidy

Before the new coronavirus pandemic, one of the main ways in which the UK’s Conservative Party boosted consumer confidence was pushing house prices up with the aid of various taxpayer-funded schemes such as Help to Buy.

But as the damage done by Covid-19 to the economy heaps pressure on the public purse, should the taxpayer still generously fund schemes that mainly serve to boost house prices and the fortunes of a few big companies and their already well-off clients?

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Will the UK impose a wealth tax to pay for Covid-19?

The fact that chatter about a wealth tax is increasing to the point where it could become reality in the UK should not be a surprise. But it would be a very odd thing for a Conservative government to be the one to actually implement it.

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China cannot afford to stop housing speculation just yet

When he finishes negotiating his “deal” with China, US President Donald Trump will probably try to take credit for the country’s shrinking current account surplus with the rest of the world.

However, the fact that China’s exports are slowing is not a new phenomenon, and it is not necessarily a reason to celebrate.

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Central banks enabled populism; they will soon pay the price

It is becoming increasingly difficult for central banks to surprise the markets with good news. No matter how dovish they are, investors expect them to be even more dovish still. This financial repression has facilitated the rise of populist politicians, who threaten to bring the end of central banks’ independence.

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Home price falls threaten China’s capitalist communism

While all eyes are on Italy, the world’s second-largest economy is showing signs of trouble. China, this curious mix of communism and capitalism, is running out of steam – and ideas. Unless the Chinese government finds new ways to stimulate its economy, it might find itself facing the world’s biggest revolution.

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The safety of housing as an investment is about to be tested

The price growth of an “asset” into which investors everywhere around the globe have poured billions since the financial crisis has slowed dramatically, and this should worry policymakers.

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Low interest rates threaten financial stability

When the bank of central banks warns about financial stability, you have to take notice — even if the warning comes in the Bank for International Settlements usually dry, academic style.

The BIS recently published a paper about the effect of prolonged interest rates on financial stability, and it makes worrying reading. (However, as most people are on holidays in August, unless they are reading it on the beach it will largely go unnoticed).

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Cooling housing markets will prevent interest rate rises

Housing markets in certain developed economies are beginning to lose steam, prompting worries that house prices might see corrections, especially in countries where they had been overheating.

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Central banks have bad news for property investors

As the major central banks are slowly retreating from their policy of asset purchases, we will probably witness some of the side effects of this withdrawal.

Warren Buffett famously said that “Only when the tide goes out do you discover who’s been swimming naked.” The tide is going out only slowly, but we are beginning to see, at least in the UK, the damage the ultra loose monetary policy has done.

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As home prices hit record levels, negative equity looms

A statement from Halifax shares the “good” news: home prices paid by first-time buyers are the highest ever.

In the first half of this year, first-time buyers paid on average £207,693 for a home, the highest price on record. This is 4% higher than a year ago, and 50% higher than five years ago.

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