Credit deflation and the reflation cycle to come.

[Thorn]

Aye but buying would mean your landlord can’t evict you and your family on a whim  at 4 weeks notice here in NIreland.

 

[King Penda]

33 minutes ago, TheCountOfNowhere said:

Lot of chatter about buying a house on here...no one mentioning 'intetest'. There is/was only a small golden window when buying a house in the last 20 years was better than renting, esp when u look at performance of other assets/investments.

 

I fear the property owning bulls(hitters) will just never get it.

 

Come conscription time/10% property tax time, you'll wish you'd rented.

 

Buying is the ultimate dead money.

 

Its like waking up to find your back on TOS 

that would more than half house prices and up rents ironicly,landlords will be in huge demand .i dont give much of a fook if im honest.lets take next door his rent is 400 my morgage is 160 if i remorgaged now it would drop to 130 quid ive overpayed you see.my lodger gives me 200 a month yet he is never in the house.so say you invest your cash and rent its not safe it can be taxed at will ,ie gordon browns pension raid.can you claim benifits if you rent and have a big stash of shares ,gold or cash  er no.i dont see my humble abode has an investment its just somewhere to live and ironicly ive not slept in it once in 3 weeks,i could sell it pocket the cash and vanish off the radar and use my mums house has a postal address......but your right if i had bought more tw. shares at 32p than i did just after the crash then i could have bought it outright,but id of also spent close to 5k a year in the meantime on rent.no doubt had i bought 500 quids worth of bitcoin a few years ago i could now be liveing in a 5 bed detached ....

[King Penda]

17 minutes ago, Thorn said:

Aye but buying would mean your landlord can’t evict you and your family on a whim  at 4 weeks notice here in NIreland.

 

what if is a wonderfull thing,its us vs the system thats the thing,the count is far more inteligent than me and he makes some valid points .however the system would love us all to rent we are at their mercy then we cant all fk off abroad ,demographicly wize we have not hit peak rent yet.in this country the ferral are the survivers ,say we all rent most would piss what they have left  up the wall they wouldnt have the counts inteligence how to invest ,what next the goverment steps in to make savy investments for you and tells you how much pocket money you can have,dont forget those nasty care costs the goverment cant cover.either way im better geared to survive whatever comes because i dont care and can drift from 1 dead end job to another,the middle class on the other hand are not they cant drop down to my wages and pay there debts or indeed rent lol.

[MrXxx]

10 hours ago, azzuri82 said:

I'm very tempted to buy a house - but the prices in Edinburgh are absolutely eye-watering at the moment. For a decent 2/3 bedroom flat in a desirable area with decent schools is £300k - don't know whether to buy (in cash) or wait.

We could potentially wait 18 months and get a much bigger/nicer place - but I/we aren't particularly flashy people - we don't want a massive house - we like living relatively modestly. I suppose the same flat could be 50% of the nominal price it is now in a couple of years - it'll mean using most of our savings/cash pile to buy something - is that a better strategy than having everything in cash/bonds/equities waiting on a crash?

"We aren't particularly flashy people....but we like to pay more than we have to (rather than wait a little while)"...logic?!

[Band]

1 minute ago, MrXxx said:

"We aren't particularly flashy people....but we like to pay more than we have to (rather than wait a little while)"...logic?!

Point is within 18 months prices could well be higher with Carney and Hammonds latest pact.

There is no logic to the UK housing market, i've waited 15 fucken years for a crash and apart from a minor blip in 2009 there has hasn't been one.

If someone buys i say good luck to them.

 

[MrXxx]

1 minute ago, Banned by HPC said:

Point is within 18 months prices could well be higher with Carney and Hammonds latest pact.

There is no logic to the UK housing market, i've waited 15 fucken years for a crash and apart from a minor blip in 2009 there has hasn't been one.

If someone buys i say good luck to them.

 

I agree, being in a similar situation and waiting for the madness to end BUT you also have to ask yourself "Is this pile of bricks worth half a mil (what a 3 bed costs around my way) or could that much money be better spent elsewhere?"......I think this is the problem, as people haven't had to earn the money before they buy it seems to lose touch with reality...some probably focus more on a couple of hundred pounds on a smartphone than they do with a mortgage.

[azzuri82]

23 minutes ago, MrXxx said:

"We aren't particularly flashy people....but we like to pay more than we have to (rather than wait a little while)"...logic?!

I understand exactly what you're saying - and of course we don't want to have to pay more for something than we absolutely have to. But...we can afford to buy a modest home in a decent area with good schooling, in cash. I'm not suggesting for a moment this is 'good value'. But when you consider the complete mess that UK and global finances are in - what chance my extremely hard-earned cash (over 15 years of taking risk after risk in various businesses) disappears overnight because of some government policy, £ devaluation or bank run/crash.

I don't think anything is particularly good value at the moment as everything seems to be financed to the hilt, as much as I'd love to time things to perfection for my own selfish means, I have a long-term partner and a 10-month old daughter - we've never had any semblance of stability in our lives and could be evicted from our current long-term rented home with just 4 weeks' notice. 

It's easy to be objective when you're looking at charts, graphs and long-term trends. But emotionally, it's very different. Every decision people make is real world risk, and those who have ignored financial/economic predictions over the last 15 years have done extremely well out of it.

I just want to have a house for my daughter to grow up in, one with a wee garden that we can put a new bathroom suite into when we desire, when we can paint the front door a different colour if we choose to, or to let my daughter choose the colour of her bedroom walls. It does sound vacuous, but there's more to life than simply evaluating every little thing in terms of optimising your finance/s and trying to time things to perfection.

I'm also aware that I could be the last bear to buy. I'm just trying to figure out if I'm comfortable with that in exchange for having security of tenure and perhaps fewer sleepless nights.

[azzuri82]

24 minutes ago, MrXxx said:

I agree, being in a similar situation and waiting for the madness to end BUT you also have to ask yourself "Is this pile of bricks worth half a mil (what a 3 bed costs around my way) or could that much money be better spent elsewhere?"......I think this is the problem, as people haven't had to earn the money before they buy it seems to lose touch with reality...some probably focus more on a couple of hundred pounds on a smartphone than they do with a mortgage.

Agreed. Me and my missus had a falling out the other day as her mobile phone contract (which expired 2 years ago!) is still being charged to her at £30/month when she could be getting the same level of tariff on a sim-only deal for £10/month. At the same time we're considering spending £300k on a house.

It's the big decisions in life you need to get right. Yes, lots of little bad decisions in life add up, but it's the big ones that really end up costing you down the road. Taleb writes constantly about such things, lots of little mistakes you can recover from, it's the big ones with massive tail risks you need to be wary of.

[DurhamBorn]

10 hours ago, stokiescum said:

to some extent thats the plan,i realised that after a lifetime of fking about what bit you have can be lost very rapidly or someone you trust can get you in a load of debt.the key off course is independance and that means buying an house on your own,but your not independant until its paid for there are still to many variables ie interest rates,work,payrates ,illness etc etc.hence i started to conform a bit clear the debt then buy a humble terrace in the shit hole that is stoke.i have £15400 left on the morgage after 5 years,once thats cleared im going back to fking about i hope,not that i stoped in the last 5 years ive had 5 jobs lol.

Sounds good to me.I own my house outright myself as well.Its a nice 3 bed semi on a good size plot (1979 build).My partner has her own house she owns outright as well.She rents two rooms out on the rent a room scheme and is here most of the time.Her house now makes £350 a month profit without having to have any tenancy agreements.Its actually a very good deal for her and the people she gets (they pay £330 a month all bills included).Shes mostly here so they have the run of the decent sized house with all mod cons.She tends to get people working up here for a year,or people who have had a crisis,divorce,split up etc.They usually stay until they are back on their feet.The two at the moment are from Malta and Switzerland,one a vet and one a nurse.I even picked the vet up from the airport in my van to save him having to get a 35 mile taxi.

She gets right up to the rent a room tax allowance,not a penny more so tax free (of course).If we ever split up no financial ties,if we dont we produce an income and provide a great service.

[DurhamBorn]

33 minutes ago, MrXxx said:

I agree, being in a similar situation and waiting for the madness to end BUT you also have to ask yourself "Is this pile of bricks worth half a mil (what a 3 bed costs around my way) or could that much money be better spent elsewhere?"......I think this is the problem, as people haven't had to earn the money before they buy it seems to lose touch with reality...some probably focus more on a couple of hundred pounds on a smartphone than they do with a mortgage.

100% right.The reason is they think its not real debt because they can sell it and get their money back.Its the madness of crowds.The deposit will go in a crack,then negative,no way out.Just keep paying the higher and higher interest bill,or clear the debt,or go under and not be able to buy for 8 years at best.

[Thorn]

Do you still see house prices sliding DB

[NogintheNog]

13 minutes ago, azzuri82 said:

I understand exactly what you're saying - and of course we don't want to have to pay more for something than we absolutely have to. But...we can afford to buy a modest home in a decent area with good schooling, in cash. I'm not suggesting for a moment this is 'good value'. But when you consider the complete mess that UK and global finances are in - what chance my extremely hard-earned cash (over 15 years of taking risk after risk in various businesses) disappears overnight because of some government policy, £ devaluation or bank run/crash.

I don't think anything is particularly good value at the moment as everything seems to be financed to the hilt, as much as I'd love to time things to perfection for my own selfish means, I have a long-term partner and a 10-month old daughter - we've never had any semblance of stability in our lives and could be evicted from our current long-term rented home with just 4 weeks' notice. 

It's easy to be objective when you're looking at charts, graphs and long-term trends. But emotionally, it's very different. Every decision people make is real world risk, and those who have ignored financial/economic predictions over the last 15 years have done extremely well out of it.

I just want to have a house for my daughter to grow up in, one with a wee garden that we can put a new bathroom suite into when we desire, when we can paint the front door a different colour if we choose to, or to let my daughter choose the colour of her bedroom walls. It does sound vacuous, but there's more to life than simply evaluating every little thing in terms of optimising your finance/s and trying to time things to perfection.

I'm also aware that I could be the last bear to buy. I'm just trying to figure out if I'm comfortable with that in exchange for having security of tenure and perhaps fewer sleepless nights.

I think buying with cash - no mortgage is a very different place to be in rather than becoming a debt slave! Your 10 month old daughter is rightly the main driver here. You could argue that the cash is actually safer in a house than a leveraged banking system, and of course you won't be paying rent each month.

You just need to crash test how both you and your partner would feel if you guess wrong.....

And let's be honest, we all know there's something wrong but we're all guessing here!

[MrXxx]

3 minutes ago, azzuri82 said:

I understand exactly what you're saying - and of course we don't want to have to pay more for something than we absolutely have to. But...we can afford to buy a modest home in a decent area with good schooling, in cash. I'm not suggesting for a moment this is 'good value'. But when you consider the complete mess that UK and global finances are in - what chance my extremely hard-earned cash (over 15 years of taking risk after risk in various businesses) disappears overnight because of some government policy, £ devaluation or bank run/crash.

I don't think anything is particularly good value at the moment as everything seems to be financed to the hilt, as much as I'd love to time things to perfection for my own selfish means, I have a long-term partner and a 10-month old daughter - we've never had any semblance of stability in our lives and could be evicted from our current long-term rented home with just 4 weeks' notice. 

It's easy to be objective when you're looking at charts, graphs and long-term trends. But emotionally, it's very different. Every decision people make is real world risk, and those who have ignored financial/economic predictions over the last 15 years have done extremely well out of it.

I just want to have a house for my daughter to grow up in, one with a wee garden that we can put a new bathroom suite into when we desire, when we can paint the front door a different colour if we choose to, or to let my daughter choose the colour of her bedroom walls. It does sound vacuous, but there's more to life than simply evaluating every little thing in terms of optimising your finance/s and trying to time things to perfection.

I'm also aware that I could be the last bear to buy. I'm just trying to figure out if I'm comfortable with that in exchange for having security of tenure and perhaps fewer sleepless nights.

I empathize with the stability that you desire;that's what sucks about renting in the UK in comparison to parts of mainland Europe (and probably why as a nation we are fixated with property ownership) but (and in answer to your other points):

1. Find a way to ensure your wealth is safe from the grabbing hands of a UK govt; property certainly isn't and is a sitting duck for taxation.

2. With your daughter so young you have plenty of time yet, and don't underestimate how resilient young children are...what's more important to them is a loving environment ....at her age do you think she knows the difference between a rented or owned property?..the moving may even be perceived as little adventures (yet to us as adults they are a PITA)...or as a worse case scenario I.e you had nowhere to live and had to buy a caravan at short notice do you think she would really be that bothered?

3. If you want security of tenure find a LL that offers longer tenancies...they usually do this as they want the security of an investment without voids, and if you tenancy states 12 months how are you going to be mooved on after 6?

[Thorn]

5 minutes ago, MrXxx said:

I empathize with the stability that you desire;that's what sucks about renting in the UK in comparison to parts of mainland Europe (and probably why as a nation we are fixated with property ownership) but (and in answer to your other points):

1. Find a way to ensure your wealth is safe from the grabbing hands of a UK govt; property certainly isn't and is a sitting duck for taxation.

2. With your daughter so young you have plenty of time yet, and don't underestimate how resilient young children are...what's more important to them is a loving environment ....at her age do you think she knows the difference between a rented or owned property?..the moving may even be perceived as little adventures (yet to us as adults they are a PITA)...or as a worse case scenario I.e you had nowhere to live and had to buy a caravan at short notice do you think she would really be that bothered?

3. If you want security of tenure find a LL that offers longer tenancies...they usually do this as they want the security of an investment without voids, and if you tenancy states 12 months how are you going to be mooved on after 6?

When we last got kicked out last year we got 4 weeks notice after the initial short term was up.

There was one rental left  available within 5 miles and over 30 people trying to get it.

 

[azzuri82]

45 minutes ago, NogintheNog said:

I think buying with cash - no mortgage is a very different place to be in rather than becoming a debt slave! Your 10 month old daughter is rightly the main driver here. You could argue that the cash is actually safer in a house than a leveraged banking system, and of course you won't be paying rent each month.

You just need to crash test how both you and your partner would feel if you guess wrong.....

And let's be honest, we all know there's something wrong but we're all guessing here!

Yes, I realise that we're in a fairly advantageous position - not many people of our age have the same quandary - I don't think we'd even be considering this had we a 10-15% deposit and had to take the rest on in a mortgage.

I think the reason it's so hard to contemplate spending these sorts of sums is because this is hard-earned income, not borne from inheritance or similar. Twin that with the fact that the vehicle that generated a large chunk of these funds, my business, is being sold and I'm going to be left without an income (albeit I can of course go out and find another job), makes the whole situation feel a bit catch 22.

[TheCountOfNowhere]

41 minutes ago, Thorn said:

When we last got kicked out last year we got 4 weeks notice after the initial short term was up.

There was one rental left  available within 5 miles and over 30 people trying to get it.

 

Assured short hold tenancy or period tenancy notice period is 8 weeks by law.

[MrXxx]

7 minutes ago, TheCountOfNowhere said:

Assured short hold tenancy or period tenancy notice period is 8 weeks by law.

But this is usually served at the beginning of the AST...only exception is 1. If initial AST is not renewed but allowed to continue thus becoming a Periodic Tenancy (tenant has to give 1 month, LL 2) OR LL failed to protect deposit and so cannot serve Notice to Quit until it is protected.

[Thorn]

2 minutes ago, MrXxx said:

But this is usually served at the beginning of the AST...only exception is 1. If initial AST is not renewed but allowed to continue thus becoming a Periodic Tenancy (tenant has to give 1 month, LL 2) OR LL failed to protect deposit and so cannot serve Notice to Quit until it is protected.

 

15 minutes ago, TheCountOfNowhere said:

Assured short hold tenancy or period tenancy notice period is 8 weeks by law.

Surprisingly enough, 4 wee weeks over here in bloody NIreland.

Every time you then go home to say “Hey kids, guess what?” focuses the mind. 

[BurntBread]

18 hours ago, No Duff said:

And must it have more, like utility, in the same way the investment in a machine has utility.

I'm still catching up with this thread, so forgive me if I'm out of sync.

You have already separated off things of utility as "chattels", I think? What is left, which you are calling "assets" are surely just those things which people will give you their labour for, regardless of direct utility. If that's true, then being a "hard" asset is absolutely dependent on what society will be like in the future. If there is an autocratic government that demands taxes to be paid in lead, then lead will be a hard asset: there will always be someone to bite your hand off to get it. Historically, for many centuries here, we have had a society that controls access to land very strictly, again through coercive force. Agricultural land has been the hard asset par excellence since 1066 at least. More recently, prime building land in cities has taken on a similar role, but I think that kind of land is more volatile, and less worthy of the status of a hard asset. Land is "the mother of all monopolies", but I think that is because of the elite's attitude to it, over the course of a thousand years, rather than it being an intrinsic property: its status as "the mother" is a function of the stability of our aristocratic social system.

[MrXxx]

Hence why those LL that are a little more switched on get the tenant to sign a new AST every 6 months.

[BurntBread]

22 hours ago, stokiescum said:

im a retard not a genius lol. 

Bollocks.

You're one of the most intelligent posters here, in terms of your reflections on what you know (as well as what I suppose could be called "kinesthetic intelligence").

What sets you apart is that the things you know about are mostly pretty different to other people here, and (sorry for doing the crappy pop-psychology thing, which is at best annoying), I think you're at the other end of the spectrum on the "conscientiousness"* part of the big-5 personality traits. On a site full of computer programmers, businessmen, scientists etc., those make you stand out. Oh yes, and you don't give a fuck about spelling, which makes @Cunning Plan weep into his cornflakes every morning.

 

* Doesn't necessarily mean what it says on the tin.

[Castlevania]

18 hours ago, No Duff said:

It certainly has a KID.

It's weird though because after so much hassle from Durhamborn (wink!) I went to buy some IBTL but the iShares website takes you to IDTL, only for the HL website to take you to IBTL.  Feck knows what I ended up buying!  But pretty certain it was some long US treasuries!

IBTL and IDTL are the same thing, the former is GBP denominated, the latter USD denominated.

[Band]

12 hours ago, stokiescum said:

,not that i stoped in the last 5 years ive had 5 jobs lol.

I used to be like that, being as other people are all wankers and putting up with them for more than a few minutes is a major headache.

Then i bought the Mike Strutter - Strutter Bubble and life is a breeze, you ought to get one!

 

[Bear Hug]

1 hour ago, Castlevania said:

IBTL and IDTL are the same thing, the former is GBP denominated, the latter USD denominated.

I've noticed that (at least on AJ Bell website), buy/sell price spreads are higher on USD denominated versions of the same thing.  Guess it's something to do with currency conversion costs?

This includes the IDTL/IBTL and GDX/GDGB.

[Game_of_Homes]

14 hours ago, Stuffed said:

Is Mark Carney talking about a global financial reset?

https://www.silverdoctors.com/headlines/world-news/finger-on-the-button-boe-governor-says-england-is-preparing-for-the-global-financial-system-reset/

Good find, thanks.

@DurhamBorn, this quote from the speech, seems to be perfectly in line with what you have been saying they will do;

Quote

This infrastructure must be overhauled now that the economy is on the cusp of the fourth industrial revolution
and our demographic challenges are intensifying. And rebalancing of the global order is proving as dramatic
as it was in Montagu Norman’s time.