Financial Lemonaid from "impending" Financial Lemons??

You have to remember that it is easy to be a Mr. Doom and Gloom merchant..have you any idea for how many years people have been saying about this impending doom and gloom senario...

We had it all during the last war, ten years ago! I remember hearing all of this ten years ago! Allways the same, but somehow we all struggle on.

Don't give any more credibility to them than the people who say otherwise....

For every expert who thinks its going to be crashes and peopel jumping off ten story buildings, you can find exactly the same number who have good predictions.

You hear some talking about japan....ok fine lets talk about japan...has anybody any idea of the real standard of living in japan? They are ten times wealthier than we are....

Germany, you often hear bandied about! Yet its much wealthier than we are, its citizens enjoy higher standards of wealth and success than we do....

Around 1991 my in-laws sold their home (which they had purchased for around 70,000 in 1983) for just shy of 169,000. They subsequently bought a bungalow for 80,000 which is now valued at just over 200,000. GBP. They live in the Midlands and their last home dropped about 12% in value a year after they sold it. From what I have been able to find from the UK census (2001 & earlier) people's income has not been keeping anywhere near the rate of housing inflation. If people's real income hasn't been rising and there has not been an enormous transfer of inherited wealth the only rationale for the housing prices that I can think of is greed induced collective self delusion.

On this side of "the pond" my father purchased a home in the early

1980's for $29,000 CDN that had previously sold for over $120,000 (granted when my father purchased interest rates were 19.5%). The last time I was in the neighborhoods I spoke with a realtor selling an almost identical home for $180.000 CDN. Perhaps my family's experiences have been extremely unusual but if there is a possibility to purchase a niceish detached house in England for 3.5x the average salary instead of 8+ x the average salary I would prefer to go that route even if it were to mean waiting a year or two.

Guess where I am coming from is the viewpoint that it is possible to make a positive personal outcome from a larger negative situation. I am trying to figure out if there are any alternate routes to interest only 50 year mortgages. (well, that & I would HATE to end up in a negative equity situation, an older colleagues here in Toronto is still in that situation from a house he purchased in 1991).

Stephen.

I think that is what I will end up doing initially (renting). I suppose that I am basing my assumption of house price moderation on the real estate segments talk of a lack of first time buyers entering the market and on the global economic stagnation which is being held with abnormally low interest rates (prime below 4% with talk of sub 1% if things do not turn around). The average Canadian home is between 60,000 & 150,000 GBP. Keeping in mind that our operating costs are significantly higher (winter temps to -20 -->

-40'C and summer highs regularly exceeding +30 -> +35'C with high humidity in many parts of the country). Add to this transportation costs; I travel over 110 miles to and from work each day so that I can live in a city with a low murder rate (usually less than 4 per year in the city we live in pop, 90,000). My car insurance is over 1,500 GBP per year with no collision coverage & a clean record.

The average cost of homes in the US is extremely variable. If you don't mind living in a city like Detroit you can buy a home for 10,000 GBP. Granted you might not live to make more than 8 mortgage payments and your home owners insurance might cost more than your mortgage but it is cheap! If you want a reasonable house in a nice neighbourhood expect to pay at least 110,000 ->170,000 GBP unless you want to live in a temperate area like SanFran or NY NY, then, the preceding will buy you a parking spot. I suppose you'll have to add the cost of guns & ammo relative to the neighbourhood that you live in.

One thing that does happen in the larger urban centers Toronto for example is that the housing is very cyclical (the last recession my aunt purchased 5 houses from realtors in the 50,000 GBP range rented them out for 4 years, did virtually no repairs and re-sold them for over 100,000 GBP each. People see that and assume that can occur regardless of purchase price. I have a inkling (now I could be very wrong) that the UK housing market is over sold and that a correction will occur. So..... having liquidated assets (and not getting burned by the stock market correction) I am just trying to figure out what the best course of action is for my childrens future.

Thanks for any insights. Stephen.

What? did I read that correctly odd moose or grisly? Now that was totally uncalled for! I know the "girls" here in North America can be a bit "big boned" but really... ;-)

With regards to the insurance rates our government about 15 years ago decided to go to no-fault auto insurance. That, coupled with a large influx of people from "pain sensitive cultures" has resulted in huge claim loads. Well that & the fact that our insurance Actuary's aren't the worlds best gamblers and the stock markets have not suffered fools the last while. (yes you are correct I work in Auto insurance claims).

Oh yeah My mini van is 10years old and has 120,000 miles on it. If only a Ferrari.....

What? Poor People in the UK? Surely you jest. When I was over in 97 there was poor people there then. Haven't you "fixed" that problem yet? What happened to the "third way"? I can't believe it, if you can't trust a politician to keep their promises who can you trust?

What ever happened to the 10's of thousands who were supposed to die of Mad Cow? Can't there be a short lived outbreak of the Black plague or something that will only affect the nice neighbourhoods?

Really? Crap. Hmm.... Do I want to live in Croydon or Liverpool.... I suppose that Meadowhall in Sheffied used to be an old steel works...... Perhaps if the properties got cheap enough & I got a bulldozer..... Parkland in Birmingham.... Think I could get funding from a bank or Building society? Inner city golf courses...

With regards to property in Canada if it provides any insight 90% of Canadians live within 100 miles of the US border. Stephen

I am a great fan of ole ~Tony! However, he's going to be in for a rocky ride. This chap at the center of the "mole" who gave the BBC info that the secret services said that downing street "sexed up the info/dossiers" on iraqs weaopns program! Pretty difficult time that this happened....

If it was just a natural occurance sure, but frankly if there was any suggestions that foul play then I think my ole mate tones going to have a rough ride. People will ask questions? And rightly so.

Good Point! Good Point! yahh..what ever did happen to them.......thats a very good point, it seems these days the news is made up of sensationalism which gives rise to inaccurate reporting..or should I say, inaccurate impressions. lol

Hey, thats not a bad idea! lol.

These days with interest rates so low, it would'nt cost too much either.