To think it's depressing that everyone seems to think after this recession we should just return to exactly how things were?

[kake]

Does anyone else get this sense? What I mean is that everybody is lamenting this recession, quite rightly as it's awful, and I feel for everyone who has lost their job or is struggling.

But on the other hand there doesn't seem to be an acceptance that in some ways this has been at least a little bit caused by complete over-consumption in the good times and that we need to change our ways a little bit. Or a lot. When people talk about house prices especially, the consensus always seems to be that if there's any talk about a recovery that must be a positive thing, with the implication that we should be getting back to stupidly inflated house prices as soon as possible.

I find it depressing, as someone who didn't buy partly because we couldn't really afford it but also because we were really cautious and didn't want to overstretch ourselves. But now we're seeing a lot of friends who did somehow being rewarded as their mortgages have been slashed.

I'm also someone who wishes that taxes had been much higher for what I consider to be well paid people (and that would include my DH!) during the boom, so that there hadn't been such a disparity in income in this country then. It's a shame that higher tax levels in future will have to pay off debt not contribute to the national benefit! If I mention this to (well paid) friends they look at me as if I'm mad, although they are people who in principle I think sort of do believe in equality, just not if it affects their/our pockets. My view is that as satisfaction with income is largely relative (ie it matters more to people apparently that they get paid more than their neighbour than their absolute wealth), then if everybody is taxed more at higher income levels, then we'd all be in the same boat and it wouldn't make much difference.

But I feel like I'm STILL swimming against the tide, just when I would have thought more people would begin to feel like this. We have lots of friends who work in the banking sector for example who've been through a bit of a rocky time but now seem to be out the other side and better off than ever and sort of with no lessons learned!

It just seems ... so wrong! Or maybe I just got out of bed on the wrong side. And this post isn't as articulate as I would have hoped!

ABetaDad. I disagree about house prices still falling. I think the fall has slowed right down and there is a small but significant shift upwards in the house market. The true bargains have all been snapped up, with a few left over if you're quick.

There will still be cheap stuff around but it won't be quality cheap stuff. People are holding off selling until the market rises again so it's only those who have to sell at today's lesser prices who are doing so.

Now's the time to bag a bargain IMO not waiting another 6 months because we'll be 2/3 the way through and people will continue to hold off selling unless they have to.

IMO.

There is a fantastic article in the latest issue of the Land magazine called 'Three Cheers for the Recession' which really helped me crystallise my feelings on this subject. (The article's not on the website btw, only earlier editions of the mag)

I've really struggled with part of me really welcoming this recession because of falling house prices, and some kind of shock to the system for the city, but the most part of me just worrying about what will happen to all of the normal people that lose their jobs, and who don't have all the cash in the bank that the bankers have.

Simon Fairlie's article really makes the point that going back to where we were just isn't going to help most of us, what we need is a really creative response to dealing with global slowdown, in a way that makes the least pain for everyone.

It also includes the great quote (which of course is not true for all but I will give 3 cheers for) "Stuff your jobs, we want land!"

Maybe I'm wrong in my reasoning here... There is a housing shortage and an increasing population. If there aren't enough houses to go around then there is no reason why the prices would reflect the national average salary.

MillyR you are bang on track there.

There is a big housing shortage (hard to believe with all the newbuild around).

I don't know if house prices will recover to their previous highest values in the near future but I imagine that the average to good to excellent areas will continue to be worth far more than 3x the average salary, so it's no use holding on for that.

The places where houses will be more affordable are the poorer areas and those areas that are party to regeneration initiatives to encourage more people to live there.

Hence my earlier post, that the house price fall is slowing down so if you're looking for something in a particular area, don't assume prices will come right down or even much further down than it is currently.

ABetaDad, that is indeed the article I was referring too!

This thread has been very reassuring as well as interesting. We are not alone - there IS intelligent life out there!

DH and I have long felt completely off the demographic radar (if that's the correct turn of phrase) because we are superficially "middle class" but possess few, if any, of the material trappings of our peers. Apart from a house full of computers that is!

Over the years we have been hectored and lectured and called peverse and irresponsible by family and friends. I'm now giving them lessons on how to flog tat on eBay and make lentil soup!

Lots needs to change, we now pay people to do the jobs mothers, grandmothers, aunties and neighbors used to do for free and who benefits exactly ?
Strikes me the government has gone for a divide and concur policy, stop communities working together, get everybody ofsted registered, remove all trust in our neighborhoods and then tax everyone for the pleasure.

PMSL at the bargains have all been snapped, this has only just begun, three million unemployed before the year is out, how are they going to pay their mortgages.
Will we see Kirsty and Phil presenting repossession repossession repossession ?

It's hard to predict how long the recession will last at the moment. There may be a lot farther to fall I suspect. We have had 3m unemployed in my life time in the UK and only have 2m at the moment. There might of course be galloping inflation at some point and big rises in interest rates to deal with that so value of loans might in effect go down which will help the debt laden but the cost of servicing them will go up which won't matter if those in work get wage inflation benefits too. We'll just have to see. Obviously quite liking my 2% current mortgage rate of course...

There's a Freudian slip if ever there was one Riven loan lone

Good thread. My DH believes in only replacing things when they break not just to have the latest thing or the best looking car.
He earns a decent wage and could drive around in a decent Merc if he wanted to, but he just wants a basic car that can get him from A to B.
Our stereo system is over 20yrs old, we don't have an ipod, Xbox,Wii or even a laptop.
We grow our own veg and have chickens and have done so since 2000 when we moved here.
The more you have the more you fear losing it.

MrsFlittersnoop - we aren't in some way related or perhaps married are we? Its just we are superficially middle class, have few material possessions and a house full of computers.

Good to hear so many others out there taking the alternative road to happiness.

Agree with Sorrento on house prices 3 million unemployed, banks demanding 25 % deposits and offering no more than 3 x salary is the reality. House sellers can hold off all they like - the buyers have no money to pay higher prices. End of.

Stock market took a beating both sides of the Atlantic today and commodity prices collapsed. Bring it on!

Hi ChocFridgeCake. I do understand that there could be a housing shortage although not totally convinced. But what I don't understand is where the money will come from to refuel the market to previous levels ... unless the government supplies it which will directly contradict any supposed help for first-time buyers?

PMSL @ 'bag a bargain now' in property market. It's going down,down still. OK so it may have bounced up a little but the overall trend is down a longway yet

I am a bit like Ripeberry, and always going on about the tomato knife I bought at university in 1979 and we still use etc. My adult daughter was joking that I would be proud of her because for the first time she has worn her knickers until they have holes in them (as I do)

ABetaDad - I have just this minute finished reading out this thread to DH, and he was so impressed with your posts he wants to be your New Best Friend!

You are all right. about everything, including the dog poo. (I posted about that somewhere else on here)
Can I join the revolution?

ABetadad and MrsFlitter, we are also in your club. On the outside DH and I 'look' middle class, but we also have a house full of computers and books and very little in the way of material possessions. We feel we live outside the 'matrix', we look as if we are part of the whole thing, but inside our home we look around at the rest of the world and know we don't belong to today's society. (Gosh we sound completely mad, we are in fact from outer space).

And I agree with those who say house prices MUST keep falling if the banks keep refusing to lend at the silly multiples they were offering until the crisis. And that is regardless of supply and demand of housing stock.

DH and I are homeowners, but we bought well within our limits, our mortgage is only 2x DH's salary. We always knew it was madness to overstretch ourselves even if the banks were willing to lend us much more than we actually borrowed so even though we are homeowners I don't feel we are part of the crazy spender brigade.

Apart for the inherent contradiction of governments saying we are living in a free market global economy- Then using taxes to bail out the banks and other failing companies (car companies spring to mind), I think as a society we have started to mistake what we WANT with what we NEED.

The thing is, we all buy into it. I know I do. I am clothed, have a (rented) roof over my head, enough food for my children, occasional treats and yet I still feel that I have not 'achieved' as a 'proper' person because I don't own my house, drive a big car, have a lovely architect designed kitchen etc etc etc etc etc (It goes on...).

[sighs longingly at idea of architect esigned kitchen]

I love these threads. You are all so right, and it is refreshing to read your thoughts which echo what dh and I are thinking.
We live in Surrey, in a modest 2.5 bedroom house, don't have any gadgets (I don't have a mobile phone at all) and don't have expensive holidays (we drive to Holland to see my family once a year) Most of the children's classmates live in 5 bedroomed homes, with two large cars outside the double garage, every gadget known to man and have 3 foreign holidays a year.
I sometimes worry that dh and I are the ones 'who've got it wrong', but then I read threads like these and my mind is put at rest.
Yes, we could get a larger mortgage (currently 2 x dh's salary) but I am not sure we want to. The temptation is there along with an element of wanting to be the same as the others in this area, but then I read threads like this and common sense kicks back in.

I wholeheartedly agree with the sentiment that houseprices should return to 3 x salary level. Problem is, how do we achieve it?

MrsFliterSnoop/oneplusone - I am watching the programme on the TV by Will Hutton (Dispatches). Me and my wife really do understand what those City boys were doing. We are from that world but it was insane then and even more insane the Bank of Englnd/FSA dd not understand.

We are indeed living outside The Matrix. That is a really good description of what we have lived through in the last decade.

May I ask what you both do with all those computers - do you work from home or are in fact attacking The Matrix? Sometimes I feel that is what we are doing.

Glad to hear I have a new best friend in the form of MrsFlitter's DH by the way - is he Morpheus and you Trinty?

DH works from home, he is a freelance software developer. We are too old and fat to be Trinity and Morpheus unfortunately!

Actually, he is Professor Branestawm and I am his long-suffering housekeeper, aka Mrs Flittersnoop.

As for attacking the Matrix - I don't like to ask too many questions about what he does all day, but he's v.v. upset about the Piratebay ruling so I have my suspicions....

I was a Suit in the City too, pre DS, and DH set up his own company after being made redundant during the dot.com crash. (Anyone remember that one? .)

Oneplusone - Greetings from Planet ZIP and (a belated) welcome to the new millenium! We ARE the New Technocracy!