House prices are falling across Britain and the doommongers have come out of the woodwork.
The thing is house prices, and how much your house is supposedly worth, is fairly arbitrary. I mean, a luxury villa is always going to be more expensive than an average semi detatched, but the prices of these individual items are decided by the market, and what you paid for the house becomes irrelevant provided you can afford to pay for it. If the value of the house you bought goes up £20,000, you haven't made a profit. In the same way, if I buy a plasma screen telly for £2,000, if the price in the shop goes up to £2,250 I haven't made a profit either. (Not to mention the fact everyone else's house has gone up proportionally).
The problem is caused(and the argument about house prices is also caused) when the middle class begin to think they are wealthy because of their house prices and borrow money against their mortgage for whatever luxuries they want, when in reality the best thing to do is pay off a mortgage asap.
I also think low house prices are a good thing. It actaully gives first time buyers a chance to get on the market rather than screwing them over.
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