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Guest Post: The Post-2009 Northern & Western European Housing Bubble

Tyler Durden's picture




 

Submitted by Jesse Colombo of The Bubble Bubble

The Post-2009 Northern & Western European Housing Bubble

Could Sweden or Finland be the scene of the next European financial crisis? It is actually far likelier than most people realize. While the world has been laser-focused on the woes of the heavily-indebted PIIGS nations for the last couple of years, property markets in Northern and Western European countries have been bubbling up to dizzying new heights in a repeat performance of the very property bubbles that caused the global financial crisis in the first place. Nordic and Western European countries such as Norway and Switzerland have attracted strong investment inflows due to their perceived economic safe-haven statuses, serving to further inflate these countries’ preexisting property bubbles that had expanded from the mid-1990s until 2008. With their overheated economies and ballooning property bubbles, today’s safe-haven European countries may very well be tomorrow’s Greeces and Italys.

The UK and London Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

UK housing prices have nearly quadrupled from the mid-1990s to 2008, briefly fell 20% in 2009 and have since rebounded enough to keep property prices firmly in the stratosphere. UK property prices are very overvalued, currently valued at 128% of their historic price-to-income ratio and 140% of their historic price-to-rent ratio. [1] In a pattern similar to France, the UK housing bubble (since 2008) has been primarily driven by price gains in the capital city of London. Prime London housing prices rose a hearty 11.4% in the 12 months to October 2011 [2], up 40% from their post-credit crunch low [3], while most other investment markets fell in a very volatile year.

Like Paris, the city of London has such a strong level of international “brand recognition” and a perceived safe-haven status that wealthy foreign investors are clamoring to buy property in prime areas such as central London. “London property is the ‘Swiss bank account’ of the 21st century,” says Robin Hardy, an analyst at London investment firm Peel Hunt. Rich people in places like Egypt, Syria and southern Europe are rushing to get their money away from the turmoil, and for want of a better alternative, they are plunking it down in the “millionaire’s playground” of central London. [4] The nouveau riche of China, India and other emerging markets are also keen on diversifying their wealth into prime Western property markets such as London, Vancouver and Manhattan, while one hedge-fund manager said that London property was a “laundromat for Russian money.” An entire generation is locked out of the city’s broken and outrageously-bubbled housing markets as the average Londoner would need to triple their salary to £87,000 to buy an average price property. [5] The prime London property bubble is highly vulnerable to the popping of the precariously-teetering China and emerging markets bubbles as well as job losses and decreasing bonuses for City of London financial workers. [6]

UK and London Housing Bubble Articles List

 

 The French Housing Bubble (incl. Paris Housing Bubble)



Chart Source: Bulle-Immobiliere.org

After zooming 120% from 2000 to 2008 and briefly dipping 5.6% in 2009, French property prices have continued their inexorable march higher since late 2009. French property prices are strongly overvalued, currently valued at 135% of their historic price-to-income ratio and 150% of their historic price-to-rent ratio. [1] Though property prices are strongly rising throughout France, the French housing bubble is strongly driven by the Paris region, where prices have jumped 18% in 2010 and approximately 10% in 2011, up more than 40% since 2005. Some posh districts in Paris have risen at a 27% rate in 2011. [2] France’s housing bubble was goosed by a 2009 law that was meant to stimulate the housing market by creating a significant tax incentive for buyers. Mortgage rates that plunged from 6.5% in late 2008 to 3.5% in 2011 were another major catalyst for soaring property prices, causing fixed-rate mortgage lending to increase by 73% by early 2011. [3]

The French property market now has the dubious distinction of being the most overvalued in Europe and the third most overvalued market in the world, behind only Hong Kong and Australia [4], which have property bubbles of their own. The Paris-based OECD warned that “there is a risk that a prolonged period of easy finance could result in a price bubble,” which may endanger French banks [5], while Hervé Boulhol, the OECD’s France economist, warned against treating French real estate as a safe-haven and that the property market’s powerful rise without a corresponding rise in income “may signal a bubble phenomenon, as a bubble is a disconnection with fundamentals.” [6] Moody’s also issued a warning that the French property market was overheating and that the least cautious lenders could face steep losses in a more price severe drop. [7] By early 2012, the French property lending boom showed signs of an abrupt slowdown, with new mortgage loans dropping 25.7% in January 2012 (yoy) and a 49.4% drop in loans between December 2011 and January 2012. [8]

French Housing Bubble Articles List


The German Housing Bubble


While Germany was fortunate and sensible enough to have avoided engaging in the 2000s housing bubble folly with the rest of the world, Germans certainly seem eager to make up for lost time. The European Central Bank’s ultra-low key interest rate, while appropriate for the ailing PIIGS nations, is too low for faster-growing Germany resulting in negative real interest rates and fears of inflation. As is common in countries with negative real interest rates, German investors are pulling money out of low-yielding bank accounts and investments and plowing it into all types of real estate, causing prices to boom for the first time in a very long while. Property prices in Munich and Hamburg rose by more than 10% in 2011 [1] , while obscure fields and forests in northeastern Germany’s Uckermark region have soared by as much as 20 to 30 percent. [2] It is too early to determine if Germany is in the midst of a property bubble, but it is certainly a situation that warrants monitoring, especially if there is an improvement in global economic growth and sentiment.

German Housing Bubble Articles List


The Swiss Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

Global and EU economic turmoil have heighted Switzerland’s traditional economic safe-haven appeal, particularly due to the fact that Switzerland is not a part of the EU and has its own currency, the Swiss Franc. After suffering from a 1980s property bubble, Swiss property prices rose an average 42% since the year 2000, with prices doubling in some spots, for reasons similar to those of concurrent European housing booms. The median price for a house across Switzerland is now a California circa 2005-esque $850,000, $2.1 million in Zurich and an astronomical $2.55 million in Geneva. [1] Switzerland’s central bank (the Swiss National Bank), in an effort to stem the rapid EU-crisis induced rise in the Swiss Franc, cut interest rates to 0% and instituted a currency ceiling in the summer of 2011, creating alarmingly similar monetary conditions to those that caused Switzerland’s 1980s property bubble. [2]

In response to rising Swiss real estate prices, UBS launched a Swiss real estate bubble index, which hit a 20-year high in February 2012 [3], while the Swiss National Bank Chairman Philipp Hildebrand warned that, “A rise in real-estate prices is among the greatest threats to Switzerland’s economy.” [4] Most worrisome is the warning of Janwillem Acket, chief economist for Julius Baer Group Ltd. (BAER), who claims that Switzerland could experience its own version of the subprime borrowing crisis, saying, “People who shouldn’t be borrowing are now seriously considering entering the housing market.” [5]  

Swiss Housing Bubble Articles List


The Belgian Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

Belgium, which is the sixth-largest economy in the euro area and has not had a government in almost two years, has seen its property prices roughly double since the year 2000, barely pausing during the financial crisis in 2009. When property prices hit an all-time high in 2011, The Economist magazine included the Belgian housing market in a list of housing markets that were overvalued by 25% or more according to price-to-income and price-to-rent ratios and described the market as “more overvalued than it was in America at the peak of its bubble.” [1]

Belgian Housing Bubble Articles List


The Dutch Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

While Dutch housing prices have moderately deflated since 2008 after doubling since the late 1990s, they are still firmly in bubble-territory, according to a report by The Economist magazine. The Netherlands’ property market ranks among the most overvalued property markets in the world, overvalued by over 25% according to price-to-income ratio and price-to-rent ratios, common property-market valuation measures. [1]  Like many countries in recent decades, the Netherlands engaged in a mortgage-borrowing binge that sent property prices soaring, saddling Dutch households with a level of household debt that exceeds 240% of disposable income, the highest level in the euro zone by far. [2

Dutch Housing Bubble Articles List


The Luxembourg Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

The tiny country of Luxembourg has not been immune to the European property bubble epidemic as already lofty property prices have risen 11% since 2009 as mortgage rates fell 2.4% in Q2 2009, in line with ECB key rate cuts, from 4.5% in Q4 2008 [1]. By late 2011, year over year rent prices for houses have exploded by nearly 18% and 8.35% for apartments [2], causing people to flee Luxembourg city in pursuit of cheaper housing.[3] Luxembourg’s soaring cost of housing has caused its residents to sink deeply into debt, with the average household’s level of indebtedness up an incredible 172% since the year 2000. [4]

Luxembourg Housing Bubble Articles List


The Austrian Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

Austria’s housing prices are up a stout 60% since 2005, a rise completely unabated by the global financial crisis. Negative real interest rates and a relatively-low unemployment rate of 4.9% have encouraged Austrians to close low-yielding checking accounts and park their life savings in local property for rental income and capital gains. [1] Austria’s obvious property bubble poses serious risks to the country’s banks, which are already teetering on the brink after losing billions of euros in an Eastern European mortgage-lending scheme that has gone terribly awry since 2008. [2]  

Austrian Housing Bubble Articles List


The Danish Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

Although Danish housing prices have leveled-off after doubling from the late 1990s to 2008, prices are still thoroughly in nosebleed territory and are among the most overvalued in the entire world. Jes Asmussen, chief economist at Svenska Handelsbanken AB, claims that Denmark’s housing market may still be as much as 25 percent overvalued. [1] Denmark’s overleveraged banking system, with banking assets as a percentage of GDP at 454% versus the U.S.’s 90%, will experience unimaginable pain when the country’s housing bubble deflates in earnest. For all of the worry that Greece’s $462 billion sovereign debt has caused the world, Denmark’s ticking-time-bomb mortgage market alone is worth more than $500 billion, with nearly 70% of new mortgages being of the highly-risky adjustable rate variety (ARMs). [2]

Danish Housing Bubble Articles List


The Swedish Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

In a pattern similar to other Nordic property markets, Swedish property prices have nearly tripled since the mid-1990s and shrugged off the Great Recession woes to rise to incredible new heights. Swedish property prices are overvalued, currently valued at 120% of their historic price-to-income ratio and 140% of their historic price-to-rent ratio. [1] The most recent phase of Sweden’s housing bubble is fueled by mortgage interest rates that have fallen from 6% in August 2008 to a just above 3%, with adjustable rate mortgages falling to under 2%. [2] Tommy Waidelich, the Social Democrats’ economy spokesman, warned that Sweden may have a housing bubble and that "A drop in house prices would hit growth, employment and state finances” and also saying, "If the reason that the price is high today is only because investors believe that the selling price will be high tomorrow – when ”fundamental” factors do not seem to justify such a price – then a bubble exists.” [3

The IMF has also warned of a possible Swedish housing bubble, saying  "There is significant risk of a decline in house prices in coming years, even in a relatively benign economic scenario,” [4] while the OECD warned that Swedish housing prices are overvalued by about 30 percent in relation to income. [5] Robert Shiller, the economist who successfully predicted the popping of the Dot-com and U.S. housing bubbles, warned investors against treating Sweden and Norway’s markets as safe-havens as the Nordic region is caught up in asset bubbles that will end with plunging asset prices. [6] A Danish finance minister has even warned Sweden of the risks of its housing bubble, saying, “Do not make the same mistake as we did in Denmark,” [7] referring to the Danish property bubble that has been deflating since 2008.

Swedish Housing Bubble Articles List


The Norwegian Housing Bubble

 


Chart Source: GlobalPropertyGuide.com

Norwegian property prices have tripled since the mid-1990s, up nearly 30% since the Great Recession as the oil-rich nation rode the coattails of the commodities bubble and has benefitted from the same “flight to safety” capital flows that have benefitted (and inflated bubbles in) other Nordic countries. Norwegian property prices are highly overvalued, currently valued at 125% of their historic price-to-income ratio and an incredible 170% of their historic price-to-rent ratio. [1] Norway’s Prime Minister Jens Stoltenberg admitted that he was “afraid” that the Norwegian property bubble might burst [2], while renowned U.S. bubble skeptic Robert Shiller said of Norwegian property prices, “This really does look like a bubble.” [3]  and that policy makers “should start worrying now because when the home prices get so high there’s a problem.” The euro area’s crisis has sparked “flight to safety” capital flows into Norway’s highly-desirable investment assets, pushing the Krone currency to undesirable export-harming heights and forcing the country’s central bank to cut interest rates to stem the inflow. Norway’s ballooning housing bubble is a side-effect of the nation’s excessively low interest rates relative to economic growth and inflation rates.

In February 2012, the IMF cut Norway’s growth forecast, saying that the Norwegian housing bubble is the country’s biggest economic risk and threatens everything from banks to economic growth. [4] Norway’s booming housing markets and cheap interest rates are encouraging households to engage in a typical bubble-style debt binge as private debt burdens are estimated to grow to about 204 percent of disposable incomes in 2012. [5] A  major risk to Norway’s economy  (and possible bubble-popping catalyst) that virtually no mainstream commentators have acknowledged is the very real possibility that oil prices might drop and sharply reduce the country’s oil profits and thus economic growth.

Norwegian Housing Bubble Articles List


The Finnish Housing Bubble



Chart Source: GlobalPropertyGuide.com

Finnish property prices soared a dizzying 250% from the mid-1990s to 2008 [1], dipped slightly in the 2009 recession and bolted 20% higher as Finland and other Nordic countries recovered from the recession faster than their European neighbors to the south. The Finnish property bubble is being fueled by a mortgage market in which a jaw-dropping 90% of loans are of the highly dangerous adjustable rate variety, while banks are taking a page straight out of the U.S. housing bubble as they push reverse mortgages on their elderly customers. A Finnish bank advertisement for reverse mortgages even shows a cartoon person taking a vacation paid for with cash withdrawn from an ATM that is attached to their house! [See cartoon] It is as if nobody has learned a thing from the U.S. housing bubble – the saying, “those who don’t learn from history are doomed to repeat it” could not apply to a better scenario than the Finnish housing bubble.

Finnish Housing Bubble Articles List

Conclusion

It is simply mind-boggling that the world is back to blowing massive property bubbles so soon after the U.S. and peripheral European housing bubbles popped and caused such incredible economic carnage. The Western and Northern European housing bubble is proof that we are living in the era of The Bubble Bubble (a bubble of bubbles) as well as an era characterized by the most outrageous arrogance and hubris that humanity has ever experienced. The 2008 global financial crisis should have taught everyone their lesson once and for all, but we are clearly living in a world filled with excruciatingly slow-learners. More punishment is coming our way and will keep coming until we finally learn from our mistakes. Sadly, by the time we learn from our mistakes, it will likely be too late.

 

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Mon, 02/27/2012 - 22:15 | 2202424 Hugo Chavez
Hugo Chavez's picture

With their birthrates dropping there is no way out. You need young people to keep your country stable, not a bunch of old codgers demanding what few young people are around work harder and take on more debt to fund codger bennies.

This is going to be a long kondratiev winter. Maybe my kids in middle age will see spring.

Mon, 02/27/2012 - 22:50 | 2202492 economics1996
economics1996's picture

If we had capitalism birth rates among the over 100 IQ crowd would rise.  The biggest boner killer for the over 100 IQ crowd is socialism.

Seriously where did all this multiculturalism/socialism shit come from?

We all fucking know and we fucking know why. 

Mon, 02/27/2012 - 23:12 | 2202538 Sam Clemons
Sam Clemons's picture

I don't actually know... where?

Mon, 02/27/2012 - 23:29 | 2202575 economics1996
economics1996's picture

Lazy mother fuckers who do not want to work.  Who else would promote that crap?

Mon, 02/27/2012 - 23:29 | 2202576 economics1996
economics1996's picture

Karl Marx.

Tue, 02/28/2012 - 09:51 | 2203420 midtowng
midtowng's picture

I can tell from your deep thoughts that you are obviously in the over 100 IQ range. [/snark]

Mon, 02/27/2012 - 23:38 | 2202591 samwell
samwell's picture

Zionazi Jews who love to divide and conquer the Goy!  and we fall for it everytime.

Mon, 02/27/2012 - 23:14 | 2202542 GoinFawr
GoinFawr's picture

Anders Breivik?

Mon, 02/27/2012 - 23:39 | 2202592 samwell
samwell's picture

who just happened to be a zionist christian doing the bidding of his israeli masters?

Tue, 02/28/2012 - 00:26 | 2202687 GoinFawr
GoinFawr's picture

Small biotech... tw3lv3 monk3ys?

Mon, 02/27/2012 - 22:32 | 2202464 Fluffybunny
Fluffybunny's picture

And with the common people looking with increasing scepticism at EU and the value of the Euro, many are buying real-estate as it's still considered the safest investment that cannot go down. The atmosphere in the housing market has something very '00-'08ish about it.

Tue, 02/28/2012 - 09:23 | 2203311 General Decline
General Decline's picture

Property would be a great investment if you could actually own some.

Tue, 02/28/2012 - 11:30 | 2203905 GoinFawr
GoinFawr's picture

Mr. Wemmick has two words for you:

portable property.

"...when you pry it from my cold dead hands." C.Heston on one type of portable property with defensive capabilities.

 

Mon, 02/27/2012 - 22:35 | 2202468 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

The only thing that the banksters know how to do is blow bubbles!

Mon, 02/27/2012 - 23:45 | 2202603 samwell
samwell's picture

the only thing the banksters are capable of doing is mistreating humanity for their own betterment.  they just can't help it because they are psychopaths whose brains are wired up wrong do to all of their inbreeding with each other.  It is a known fact that jews are some ofthe most inbred ethnic group in the world due to population bottlenecks in their history.  So, they suffer from diseases like Tay Sachs but they also suffer from malevolent abherrant psychopathy.  They are. incapable of experiencing empathy for another human being.  It is a well known fact that inbreeding has a tendency to create psychopaths over time.  That is exactly what we have here with the zionist bankster jews!

Tue, 02/28/2012 - 03:33 | 2202972 bartek
bartek's picture

"The 2008 global financial crisis should have taught everyone their lesson once and for all, but we are clearly living in a world filled with excruciatingly slow-learners."

 

Could it be that it has something to do with the quality of food and water supply? Just yesterday in the news from Poland: over a period of 10 years (!), up to 3 000 tons per month (!) of industrial salt (containing dangerous carcinogens and only to be used for roads and sidewalks and in chemical industry) was being sold to food processing plants as edible salt and introduced into the food supply.

 

http://www.tvn24.pl/-1,1736338,0,1,3-tys-ton-niejadalnej-soli-miesieczni...

Mon, 02/27/2012 - 22:18 | 2202432 The trend is yo...
The trend is your friend's picture

Lets not forget the the asian property bubbles.  CHINA and INDIA.

Tue, 02/28/2012 - 01:23 | 2202792 whatsinaname
whatsinaname's picture

I agree !! India is getting downright Stratospheric..

Tue, 02/28/2012 - 08:30 | 2203198 EmileLargo
EmileLargo's picture

I have a lot of friends in India. While the prices are insane, your average buyer is not leveraged as I understand it. A lot of people often misunderstand how the property markets work in China and India. There is a lot of "black money" (illegal money mostly on which no tax has been paid) which is used to buy property. The transactions are usually at least 50 percent hard cash. If the market drops, the owners take a hit but the banks generally do not.

Secondly, India has had a print-happy central bank and government for years. If you run inflation regularly at 10 percent, debts get washed out in no time. This is why the usual metrics of price to income on property in India doesn't make a lot of sense because your average landlord doesn't have mortgage repayments to service out of rent. Property is simply a haven from inflation and taxation.

Mon, 02/27/2012 - 22:20 | 2202433 GoinFawr
GoinFawr's picture

"Could Sweden (Norway-Ed.) or Finland be the scene of the next European financial crisis?"

Did you just feel that disturbance in the Force? Like millions of Libertarians and other assorted Ayn Randian acolytes all crying out at once,

"Yes!!! Oh Dear Ghod please let the answer be YESSSSS!"

Short ans. which of the nations listed above has GS with its fingers in her pie?

 

 

 

Mon, 02/27/2012 - 22:21 | 2202440 Yes_Questions
Yes_Questions's picture

 

 

EEEWW!

Mon, 02/27/2012 - 22:53 | 2202499 Hugo Chavez
Hugo Chavez's picture

Lol.

Oh god yes! Please let more social welfare states collapse!

I think I am about to come.

Mon, 02/27/2012 - 23:03 | 2202522 GoinFawr
GoinFawr's picture

Hey, if it's pipedreams that float your boat, who am I to judge?

Mon, 02/27/2012 - 23:53 | 2202612 LowProfile
LowProfile's picture

Hahaha!

You're really on a roll tonight bubala.  Don't stop!

Mon, 02/27/2012 - 22:20 | 2202435 prains
prains's picture

what about the aussie and canadian housing bubbles?

Mon, 02/27/2012 - 22:50 | 2202447 GoinFawr
GoinFawr's picture

irrelevant, not quite fiscally responsible and/or socialist enough to merit mention in this article. (Canada was close on that last one, but since last year when they elected a 'Conservative' majority gov't committed to Globalism their rhetoric pushes all the correct buttons)

Besides that, their national coffers are already a deep shade of red; misery loves company! Of course, you could argue that such profligacy would make them more susceptible but... y'know.

Mon, 02/27/2012 - 23:54 | 2202613 LowProfile
LowProfile's picture

http://www.crackshackormansion.com/ says:  Your, early...  And an idiot!

Tue, 02/28/2012 - 00:35 | 2202664 GoinFawr
GoinFawr's picture

Uh, oh, if this survey extrapolates my neighbours only have a 9/16 chance of me being right about what they're up to.

Mon, 02/27/2012 - 23:01 | 2202515 Element
Element's picture

Those are not bubbles damn it! 

 

(I'd better put a /sarc on that)

Mon, 02/27/2012 - 22:24 | 2202442 kito
kito's picture

How about the "articles on bubbles" bubble?

Mon, 02/27/2012 - 22:26 | 2202444 AUD
AUD's picture

Yeah but housing is only the little brother of the biggest bubble of all...

That of 'money' itself - the obligations of government & their central banks.

Mon, 02/27/2012 - 22:57 | 2202506 Hugo Chavez
Hugo Chavez's picture

I wonder if kondratiev cycles are just a small part of bigger supercycles.

The dark ages was one hell of a long downswing.

Mon, 02/27/2012 - 22:24 | 2202445 sickray
sickray's picture

property prices rise for different reasons, this could well be a bubble but is the mechanism actually the same as the us property bubble? can't see it mentioned anywhere...

Mon, 02/27/2012 - 22:30 | 2202459 Dr. Engali
Dr. Engali's picture

The globalist sure have done a good job of stripping this country of its wealth. They were very stealthy about it. They slowly extended credit to make up for the productivity they were stealing. Most people didn't even know what was happening because they had an illusion of wealth thanks to the credit. Now that the credit markets are broken they have moved elsewhere to plunder. Soon there will be nothing but pockets of wealthy people who can fly from luxury home to luxury home while the serfs in the servant economies who take care of them can't even afford to live in the same cities in which they work.

Mon, 02/27/2012 - 22:32 | 2202460 Yes_Questions
Yes_Questions's picture

 

 

Collapse.  Its whats for dinner, Abendessen, Deipno, dîner, engels, cena, jantar.

Mon, 02/27/2012 - 22:40 | 2202472 Caviar Emptor
Caviar Emptor's picture

You know what "They" would hate? (TPTB)

If the huge numbers of people now unemployed, underwater, near the brink throughout the developed world just gave up on their hopless yuppie aspirations and simply focused on trying to make the world a better place. 

Oh man, that would rile them! That would shatter their globalist power dreams. It's their nightmare

Mon, 02/27/2012 - 22:52 | 2202494 Sean7k
Sean7k's picture

Just finished a great short essay by Etienne Boetie, "The Discourse of Voluntary Servitude". Written in the late 1500's but strangely relevant today and to your comment.

Mon, 02/27/2012 - 22:56 | 2202503 Caviar Emptor
Caviar Emptor's picture

Interesting, @Sean. I'll look it up. Suddenly, the entire fabric of the power structure can disintegrate if everyone just stops being a "wanna be". 

Mon, 02/27/2012 - 23:02 | 2202520 Hugo Chavez
Hugo Chavez's picture

As long as the top 0.001 percent keep us divided into red teams and blue teams this could go on a long time.

The xmas armistice of WW1 was an example of what the world could be like if we the commoners refused to obey our masters.

Mon, 02/27/2012 - 23:08 | 2202525 Caviar Emptor
Caviar Emptor's picture

There are many, many examples of silent revolutions against TPTB down the ages, friend. And they took down powers that seemed unshakable at the time: Roman Emperors, English Kings, Feudal lords, just to name the most familiar. When the time is ripe, the forces are unstoppable. 

Mon, 02/27/2012 - 23:16 | 2202547 Yardstick of Ci...
Yardstick of Civilization's picture

Not likely to happen today . . . we're all so sold on the idea that our lives are priceless that we've stopped demanding liberty and started cowering and just hoping for an opportunity to exist. Very few, if any, are willing to risk their priceless lives to effect a change in the status quo, and any movement at all in that direction in this day and age of digital spying where Google has identified every potential subversive would be quashed in a millisecond. I'm afraid to say that times have changed. Changing the changed times will require an outside force. Chinese nuke, bio weapon, etc.

Mon, 02/27/2012 - 23:26 | 2202557 Caviar Emptor
Caviar Emptor's picture

When it seemed impossible before, it happened. Having little to gain by participating and little to lose by quiting is inducement enough 

Mon, 02/27/2012 - 23:28 | 2202572 Yardstick of Ci...
Yardstick of Civilization's picture

Hope you're right and that it happens in my lifetime. Is there a signup sheet going around?

Mon, 02/27/2012 - 23:37 | 2202590 Hugo Chavez
Hugo Chavez's picture

Clean and oil your grandaddys deer rifle. Replace the firing pin. Get a hundred dollar sniperscope from shopbarska.com. practice.

If the afghanis even had cheap old deer rifles with scopes we woyld be in serious trouble. The ability to make a 400 yard shot with all the cover available in urban and suburban areas is ten times more important than rapidity of fire.

Tue, 02/28/2012 - 01:30 | 2202808 alesarte
alesarte's picture

Urban areas...  planning on eating your neighbors?

Tue, 02/28/2012 - 04:23 | 2203023 UP Forester
UP Forester's picture

Just the slow ones....

Mon, 02/27/2012 - 23:32 | 2202582 Hugo Chavez
Hugo Chavez's picture

I disagree.

That same hotheaded five percent that is in the thick of all revolutions is still around.

We have rapid desimination of knowledge and force multipliers now. Of course the set piece military battle or seige cant be won. There are plenty of other ways to make an area ungovernable.

Tue, 02/28/2012 - 00:03 | 2202623 LowProfile
LowProfile's picture

Not to mention you need the military on board.  They really fucked up when the shot that Marine in the face.

http://articles.businessinsider.com/2011-10-27/news/30326795_1_fair-cond...

400 yards for those guys, no scope? No problem.

Tue, 02/28/2012 - 00:16 | 2202656 gwar5
gwar5's picture

They want you to feel that it is too daunting to overthrow them. Their greatest weapon is to beat us down psychologically, using the money system to make us scared about where our next meal is going to come from.  It's a tried and true Psyops. That's what they're doing to Iran right now to soften them up. 30K drones and the NDAA in the USA? ... just more of same.

Never forget that we are the sovereigns and the only true authority for what will/can happen and they know it.  The last thing they want to do is remind us that we are their sovereigns and we can kick the elites to the curb and revoke the Federal Reserve Act if we want.  They are trying to make us voluntarily surrender our authority by acting as if we don't have any authority. We possess all the authority. They are criminals hanging by a thread.

If the Main Stream Media were like ZH, instead of Leni Refienstahl, the masses would already be routing them with pitchforks.

Mon, 02/27/2012 - 23:28 | 2202574 gwar5
gwar5's picture

Many have gone Galt, including me. Deflating of ones economic lifestyle and going off the economic grid is easier than most think. Atlas is shrugging and it's a fine feeling. Life is simple, life is good. I highly recommend it, even part way, if possible.

 

Tue, 02/28/2012 - 04:09 | 2203013 Raymond Reason
Raymond Reason's picture

Welcome to the dark side.  And not only is it a healthier, happier and more fulfilling way of life, but we're doing our part to starve the beast.   Less is more, brother. 

Mon, 02/27/2012 - 23:28 | 2202573 piceridu
piceridu's picture

Just happened to read it last week...written in 1576...you have excellent taste my friend.

"But if a hundred, if a thousand endure the caprice of a single man, should we not rather say that they lack not the courage but the desire to rise against him, and that such an attitude indicates indifference rather than cowardice? When not a hundred, not a thousand men, but a hundred provinces, a thousand cities, a million men, refuse to assail a single man from whom the kindest treatment received is the infliction of serfdom and slavery, what shall we call that? Is it cowardice? Of course there is in every vice inevitably some limit beyond which one cannot go. Two, possibly ten, may fear one; but when a thousand, a million men, a thousand cities, fail to protect themselves against the domination of one man, this cannot be called cowardly, for cowardice does not sink to such a depth, any more than valor can be termed the effort of one individual to scale a fortress, to attack an army, or to conquer a kingdom. What monstrous vice, then, is this which does not even deserve to be called cowardice, a vice for which no term can be found vile enough, which nature herself disavows and our tongues refuse to name?"

Tue, 02/28/2012 - 11:11 | 2203793 prole
prole's picture

Being a sheople? Demanding and embracing your chains? Scorning liberty?

Being able to watch any Mainstream Media propaganda without retching?

OK wait here is my serious answer- (although the above answers are all true)

The answer is- That sheople absolutely loathe the idea that some others might be free, so they, in their hearts, worship and cheer the police state when it stamps out the freedom and lives of the "others" (drug enjoyers, pot smokers, drunk drivers, gun owners, deadbeat dads, insert hated class here) and so we all become slaves due to the sickening hateful hearts of the sheople.

Sorry it took 500 years La Beote but there is your answer.

Mon, 02/27/2012 - 23:09 | 2202529 Yardstick of Ci...
Yardstick of Civilization's picture

"What about nine million socially conscious and unified citizens all just stepping up and doing their part?"

~Allen from the movie The Other Guys~

Mon, 02/27/2012 - 22:44 | 2202479 Atomizer
Atomizer's picture

As long as EU keeps playing Name That Tune. The prize winnings eligibility awards cling onto baited pension chance taker’s.

Mon, 02/27/2012 - 22:46 | 2202489 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

No wonder the Europonzi needs to keep inflating.

Mon, 02/27/2012 - 22:49 | 2202490 Sean7k
Sean7k's picture

If I remember right, the wealth transfer from the housing bubble collapse in the US was in TRILLIONS. The bankers seemed to do better than others. This has been well documented and yet, every other country in the world not presently having a burst bubble (PIIGS, US) we see the same bubble. 

It is evident where much of the fiat is flowing. The Money supply destruction is going to be interesting. What will be left? What will have value? 

If you don't take the time to figure that out, keep in mind that all the gold in the world is a small block 68 feet square. Most of that gold belongs to the banks/sovereign countries in debt to banks. 

I would hate to be in that gold rush, fighting over single coins with wheelbarrows of dollars, euros, etc.

Mon, 02/27/2012 - 22:52 | 2202496 A Lunatic
A Lunatic's picture

What, did we run out of free money or something?

Mon, 02/27/2012 - 22:53 | 2202498 Bunga Bunga
Bunga Bunga's picture

Told you, Greek rich bitches richer, bitchez!

Mon, 02/27/2012 - 22:53 | 2202500 spiral_eyes
spiral_eyes's picture

this is freaky.

Mon, 02/27/2012 - 22:55 | 2202501 Yardstick of Ci...
Yardstick of Civilization's picture

We guard you fuckers while you sleep:

http://news.yahoo.com/blogs/trending-now/banker-insulting-tip-incites-cl...

Who did this, Tyler? Run with it . . . .

Mon, 02/27/2012 - 23:17 | 2202552 Hugo Chavez
Hugo Chavez's picture

Find out his name. There is no law in the usa against publishing the truth about private or public figures.

I remember a certain topcalling troll who encouraged food service staff to infect bankers and oligarchs with all sorts of nasty body fluids in the food.

I think he must be in troll heaven now. May he rest in peace.

Mon, 02/27/2012 - 23:32 | 2202583 Yardstick of Ci...
Yardstick of Civilization's picture

I'd love to see this pricks name published all over the internet to the point where PR is such a nightmare that he is forced to buy the waitress a car or house in a failed attempt to rehabilitate his image.

Mon, 02/27/2012 - 22:55 | 2202502 non_anon
non_anon's picture

bubble, bubble, spoiling for trouble

 

Mon, 02/27/2012 - 23:00 | 2202507 Rogier
Rogier's picture

No shit Sherlock that there's a housing bubble in The Netherlands. Prices will have to come down another 20-30% to return to normal, apart from a very small number of very sought after ultra wanted locations. Far more worringly: the housing bubble has inflated GDP growth some 7% over the last 10 years because of the over familiar 'spending unrealised gains' on trinkets. Guess what that's doing to GDP growth now that the tables have turned: yup, negative growth on the double. FrAAAnce went to FrAAnce, guess where we are heading. But since AA+ is the new AAA, there's nothing to worry about... Really folks, just move on...

Mon, 02/27/2012 - 22:59 | 2202511 ebworthen
ebworthen's picture

Here in the U.S. I'm hearing "Get a Home Equity Loan Now!" commercials.

Uh-Oh.

Pump up the bubble, pop-it, pass it to the taxpayer again, all over again, again.

 

Mon, 02/27/2012 - 22:59 | 2202512 Jack Burton
Jack Burton's picture

So many housing bubbles! None could exist without cheap credit and easy lending rules. Cheap and easy money flowing from bankers looking to cash in by printing money and gaining interest on it. The bonus pools are full.

I honestly don't get why people will take on such debt levels to own a home. They must be banking on continued price rises just like happened in the good old USA. Families looking for a home became speculators looking for easy money and they did it all with leverage that required constant price inflation. The minute housing peaked the game was over.

I guess lots of other nations need to learn the same lesson.

As for London, prices there are driven by the UK being the world's safe haven for the wealthy who want a fall back position should their native countries fall apart into economi collapse. Plus London just can't be beat as a place to live if you got the money to enjoy what that city and it's environs have to offer. Seriously, if I had the money I would be in line to buy anything in London I could get my hands on.

Tue, 02/28/2012 - 05:59 | 2203083 falak pema
falak pema's picture

London is NOT UK, its Oligarchy land; an island of real estate in a sea of sheeple dismal state. Just like the uber-City, its very elitist lungs and heart pump, is not the UK sheeple economy. The Oligarchs live where their money is parked, its as simple as that. Thatcher's legacy to Oligarchical tax-free haven status, with Jersey type trusts, has made all those Oil/russian oligarchs live in London as second home. As the Petrodollar unregulated market since 70s and now the Big BAng derivative markets have made City hub of international finance all devoted to Oligarchical trans-national cause.

So both WS and City and now emblematic of 1%-99% divide in so called democracries; and the RE markets in these areas reflect this class divide on the ground so to speak, in hard asset terms. Its totally feudal our new new world order. That's the bottom line.

Transnationality is the song of the Oligarchs; retrenching to nation-state debt ridden and economics doldrum land is what is left to the sheeple; fed on the MSM concocted junk by their leaders, who speek "sheepleese" but ACT "transnationalese", as they serve the Oligarchal feudality.

 Europe seems to have a real, well anchored belief that the only true assets on this old continent is hard stone in city centres; a tradition that comes from feudal times when those kings who made this continent built all their castles. We are now back there, believe it or not! All the while the transnationals park their wealth in the Caymans and build their factories in the third/fourth world.

The asymmetry is now coming to boil as this whole first world construct is artificial. The only coherent Oligarchs in this mad world are Chinese or Brazilians. At least they don't run with their money to foreign lands, like Euro-Americans, and their surrogate Arab and Russian stooges parked in Park Avenue or MAyfair or Avenue Foch. 

Mon, 02/27/2012 - 23:00 | 2202516 UP Forester
UP Forester's picture

Don Ho has got to re-write and re-release his famous song.

It'll go Rhodium....

Mon, 02/27/2012 - 23:05 | 2202524 gwar5
gwar5's picture

Wow. Everybody is looking for a safe haven. Yet the most obvious one, gold, is being largely ignored. Around here we call that a dirty rotten shame.... buy buy buy!

 

Tue, 02/28/2012 - 01:40 | 2202826 DoChenRollingBearing
DoChenRollingBearing's picture

+ $55,000

Mon, 02/27/2012 - 23:18 | 2202551 Caviar Emptor
Caviar Emptor's picture

When real estate bubbles burst and economies tank, the veil is lifted on just how 'virtual' real estate ownership really is. You don't own a thing if you can't pay taxes and banks. Eminent domain removes whatever other illusions might be left. 

Tue, 02/28/2012 - 11:39 | 2203936 MachoMan
MachoMan's picture

Eminent domain isn't a tiny fraction of the risk that taxation is...  (in fact, having been associated with numerous eminent domain cases, I'd say it might even be beneficial if you can get the right jury and you make a decent witness).

Ask the TBTF and MBS investors about it...  if they don't already know who their daddy is, then they will shortly...  pony up the taxes or lose the security...  your choice.  Shadow inventory does have a price.

Mon, 02/27/2012 - 23:22 | 2202562 chindit13
chindit13's picture

Come on, these are Lawrence Welk's theme song compared to the un-tiny bubbles we have here where I reside.

Can anybody beat 100,000% RE increase since 2001?  Of those who think they are up to the task, can you do it with a per capita income that is still about $350/year and where mortgages and fractional reserve banking do not exist?

How did we do it?  Two things:  one is spillover from the blobbing Chicom citizenisms next door.  The other factor---and this might make some queasy---is that gold does not make people smarter.  Massive gold and silver discoveries have fueled inflation as "rational" consumers found nothing better to do with their sudden wealth than show off (in a country with a minimum of paved roads, and the roads that are paved have more craters than the face of the moon, one successful prospector just bought a 420-kph Bugatti Veyron to fit in his 10-car garage in one of his many homes).

Tue, 02/28/2012 - 00:50 | 2202727 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

When you say prospector you don't mean the old guy digging in the dirt, do you?  You mean the son of a wealthy elite chinaman who had the funds to start a company who would pay to have others dig up the metal, because the car you speak of is expensive and rare, and those blobbing chicoms who make $350/yr can't afford the gas that fuels the engine.

Tue, 02/28/2012 - 01:38 | 2202822 chindit13
chindit13's picture

The "prospector" got a license to mine in a particular area.  Licenses for what might be good areas are manna from heaven, but yes, afforded only to those who made it past the Gate.  At the same time, other former <$350/year people simply got lucky and found some rich veins.  They have gone from bamboo huts to twenty room, $10+ million mansions, a la Jed Clampett.  Overall inflation is about 10-15% year (property has been much much more) despite a currency that has soared vs. everything from the dollar to the yen.  (By the way, not only is the Veyron wildly expensive, and finding a qualified mechanic will be a touch problematic, but there is a 167% import tax.)

There is precedent of sorts for this type of precious metal-driven inflation in Spain.  This place might be an interesting microcosm for those who think PMs and no fractional reserve banking system or mortgages creates economic nirvana.  So long as people are people, there is no nirvana, not even in the heart of the Buddha Belt.

The blobbing Chicom citizenisms are not legal residents of the country where $350 is the per capita income.

Mon, 02/27/2012 - 23:31 | 2202578 Learn more and ...
Learn more and know less's picture

Those wonderful "up and coming" areas of inner London like Hackney, Lambeth and Wandsworth, where house prices are sky high had a taste of what "up and coming" actually implies last summer. If the average wage is less than a third of what an average house costs in all of London, in many parts these Boroughs it is probably more like a tenth. 

Young kids who have no hope of ever buying a house in the area in which they grew up, tend to react violently when provoked. 

I thought the London riots were one of the news highlights of 2011, 'Occupy Wall Street and LSX' were the most inspiring events of the year, but the London riots scared the sh£t out of TPTB. The police don't mind beating on middle class protestors but its another story when they confront molotov cocktail armed street yoofs on the riot.

If we could really unify the 99%, Tea partiers (Daily Mail readers in the UK), Occupy, and the 'street' kids who rioted, to a common cause, the days of the Empire of fiat money would be numbered in just two digits.

Mon, 02/27/2012 - 23:49 | 2202608 Vic Vinegar
Vic Vinegar's picture

the London riots scared the sh£t out of TPTB.

Doubt it.  But hey maybe you're right.

Now this:

If we could really unify the 99%, Tea partiers (Daily Mail readers in the UK), Occupy, and the 'street' kids who rioted, to a common cause

is the real philospher's stone.  Crack that code, buddy, and you get a star!

Tue, 02/28/2012 - 00:10 | 2202641 Learn more and ...
Learn more and know less's picture

I don't know how much is MSM bollocks but apparently the tactics these kids used were to shift the looting from region to region through blackberry messaging so as to keep away from areas where the police were deployed in numbers. 

The knee jerk reaction of 'harsh sentencing' giving years in jail for looting, basically changing the law, showed that TPTB were at least spooked.

No star for me, don't have the key, but the problem with Occupy and all the Anti-war / Eco protesting stuff, is that they are far too polite.

Somehow the poll-tax riots of 1990 managed to get get a broad enough support to freak the government out to change the law, being at the beginning of a recession helped.

With unemployment soaring, there are plenty of discontented yoofs around, this should be dangerous for TPTB.

But the Inner City kids tend to be be apathetic to everything except displays of money, branded clothing, cars etc. Which is why the looting had no other purpose than to do some robbing.

Not sure if rioting is the answer anyway, doesn't seem to be working in Greece. Perhaps just dissengagement from the system is a better strategy. 

Got any ideas?

Mon, 02/27/2012 - 23:57 | 2202617 Rogier
Rogier's picture

You're right as so far as that not every rioter was 100% lower class scum. There was some middle class scum as well participating in the London riots. The only ingredient the London riots were missing were Korean shop owners defending their shops LA style. If you're a looter and get shot, the joke's on you my friend.

Tue, 02/28/2012 - 00:18 | 2202662 Learn more and ...
Learn more and know less's picture

There were some very well publicised stories in the MSM about middle class kids being involved, but they were certainly not the majority, a very small minority is my guess.

I junked you for calling them "Scum".

The rioters look like sweet little innocent babies when compared to the taxpayers paid bonus swindling criminal bankers and the the expenses fiddling politicians.

 

Tue, 02/28/2012 - 00:17 | 2202660 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Two digits:  10 Downing Street

Mon, 02/27/2012 - 23:53 | 2202611 Atomizer
Atomizer's picture

 

 

Agenda 21

http://www.un.org/documents/ga/conf151/aconf15126-1annex1.htm

Past:

Greenspan, we considered buying & burning the houses down

http://www.youtube.com/watch?v=2jeXwFa3KYI 

Present:

Warren Buffet, Buy single family homes.

http://www.cnbc.com/id/46541258 

One has to wonder if two conflicting messages bump heads, the market listens.

Mon, 02/27/2012 - 23:56 | 2202615 deflator
deflator's picture

A lot of these countries with Luxemborg at the top are rated as the best places to live in the world. Highest standard of living, low crime etc. Those charts could easily be read as global inflation. Real estate is complex but there are no doubt many properties in these countries that have gone up simply because the overall markets in these areas have been desirable. I was briefly looking at some properties in Luxemborg online after the greatest places to live story and some of them were badly run down and dilapidated but were still over a $mil. These buildings looked like they could easily be condemned.

Tue, 02/28/2012 - 00:07 | 2202631 steve from virginia
steve from virginia's picture

 

The EU states need some (surrecepticious) credit to bail out their non-remunerative industries so there are near-zero interest rates an no worthwhile investments anywhere (remember? The non-remunerative industries??? Germany IS Greece.)

Low interest rates mean negative REAL interest rates and funds for real estate. Gotta love those granite countertops!

RAISING the interest rates causes the carry trade and flight-to-safety capital flows. Can't win for losing!

How about capital controls (you fucking idiot central bankers?) Instead of blowing up real estate you can blow up an asset category that has foreign exchange risk.

I don't care any more. let them all blow up.

Tue, 02/28/2012 - 01:14 | 2202769 steelrules
steelrules's picture

Canada belongs on that list too, prices tripled from 01 to 08 and barely pulled back in the crash, infact the bubble has only gotten bigger because of cheap money since the crash.

 

Tue, 02/28/2012 - 01:13 | 2202772 Kevlar Akubra
Kevlar Akubra's picture

There once was a Finn who got fat

You can thank easy credit for that

But just like the rest

Things soon weren't the best

And he ended up eating his cat

Tue, 02/28/2012 - 02:10 | 2202880 Sandmann
Sandmann's picture

Excess Liquidity has to find an asset  class to re=balance portfolios

Tue, 02/28/2012 - 02:53 | 2202903 Youri Carma
Youri Carma's picture

Finnish are Finished! – But not yet …

Nobody escapes the wrath of bubble economics and the Fins are not nobody.

(That last one was tricky but once you understand it you may apreciate it.)

 

Rabobank: House prices will continue to fall In The Netherlands (google trans from Dutch) http://tinyurl.com/7shc8n3

21 February 2012, Amsterdam (Dow Jones)

Excerpt:

According to The Dutch Central Bureau of Statistics (CBS) house prices fell by 2.3% in 2011, with a marked acceleration of 1.7% in the fourth quarter.

House prices declined 11% since the peak of August 2008.

Adjusted for inflation houses were 15% cheaper in the past 3.5 years. However house prices are still 80% higher than in 1995. Adjusted for inflation that’s 60%.

Dutch house prices will see an average decline of 5% in 2012 and also in 2013 this decline will continue.

Tue, 02/28/2012 - 02:40 | 2202917 q99x2
q99x2's picture

Of course the prices are going up over there. Where the heck do you think the US whites are fleeing from the NWO to - Mexico?

Tue, 02/28/2012 - 02:41 | 2202920 malek
malek's picture

In 2005 you could get a Swiss fixed rate mortgage over 10 years for 2.5%

Tue, 02/28/2012 - 03:15 | 2202948 Finnman
Finnman's picture

Article says: "90% of loans are of the highly dangerous adjustable rate variety"

Banksters say in Finland that adjustable rates are wise because rates are now below inflation rate. Adjustable rate follows market rates and so it's most efficient for customer.

It's also said that turbulence in Europe does not affect Finland because there is sea between Europe and Finland, and in east we have Russia which always protects small Finland. It's said that when Nokia moves it's headquarters to USA or China, we still will not have any problems as we have Finnish Housing Property (TM)

Some reasons to add why prices will go up more: Finland is accelerating internal migration from North to South coast strip (large country but closing schools, and very soon some universities and even garrisons from eastern border).  Concentrating everything to one large city is the main goal of the ruling government which is also very PRO-EU and pro globalist. Internal migration and immigrant flow outside EU are the main engine for Finnish Housing Bubble. Political elite says that there is not enough greenfield building land in Finland but it's ridiculous, you can see that when arrive to Helsinki Airport. It's capital and just forests and loamy fields. Fly over Finland and look how much there is area for building.

It's Finnish taxpayers who pay this stupid game. During end of last year, government even paid 3000euros extra to all new house buyers who took so called ASP-loan. But if no loan and buying 100% with cash - then of course no 3000 euros bonus as it was meant to banksters. If loan, then 3000euros to spend, it was like with car market in USA?? Now I think no more bonuses as government maybe have noticed they will go bankrupt.

 

Tue, 02/28/2012 - 03:13 | 2202949 upb
upb's picture

LTRO going to only make things worse not better  http://tinyurl.com/7sbluhg

Tue, 02/28/2012 - 03:21 | 2202960 Finnman
Finnman's picture

I expected housing prices will fall in Finland somewhere 2014-2016, NOT earlier as fall would be catastrophic to Helsinki metropole area. Government will do EVERYTHING to stop it, many political leaders have large loans, invested to housing and so they have also personal interestes to keep prices going up.

I expect Finnish treasury minister give maybe just 50-100 million euros to support building sector late this year. Maybe some extra bonus again from helicopter to people who buy apartment, maybe this time 2000 euros as not so much money to give.

 

Tue, 02/28/2012 - 03:34 | 2202976 Hobbleknee
Hobbleknee's picture

Another thing fueling the Swedish housing bubble is the infinity mortgage. You don't have to pay down a home loan at all; you can just pay interest forever.

I also think 30% overvaluation is too little.  It needs to come down at least 50%.

Tue, 02/28/2012 - 05:11 | 2203037 Phad
Phad's picture

Well you can only loan up to 85% of the value of your house in Sweden.

Norway just took that law as well.

So many house owners have some marginals at least.

When it comes to Norway... there is no unemployment. Those that are unemployed don't want to work and they live mostly on the country side where the bubble don't exists.

Norway have few places to build houses due to all the mountains everywhere so when people move where thw work is then you get shortage of living space. I don't think it's the same in other nations like USA where it's possible to build almost anywhere.

Swedish housing have already gone down 10% from the top, all during 2011. It will continue I think but slow and steady decline not a drastic fall like -20% in one year.

Tue, 02/28/2012 - 05:27 | 2203063 Megalodon
Megalodon's picture

The 15 % "cash law" has just had the dubious efffect of banks giving customers a personal loan at a higher rate than the 85 % mortgage loan....

Add to that the deductibles for renovations..

But according to the statisticians house prices are only up about 22 % since 1995

http://research.stlouisfed.org/fred2/series/SWECPIHOUQINMEI

Tue, 02/28/2012 - 05:50 | 2203079 Phad
Phad's picture

Ok, I thought they forbid blanco loans or at least that banks didn't give it since they see it as to big risk.

Tue, 02/28/2012 - 06:19 | 2203092 Construct
Construct's picture

I live in Sweden and the prime minister 'Fredrik Reinfeldt' has developed into a fully fledged EU dictator with spies placed everywhere in government and at the unemployment office to monitor any rebellious behavior. Let me put it this way. My only goal right now is to get out of Sweden and Europe. It is that bad. Things are about to fall apart in a very bad way. They also monitor all internet activity via a program called FRA that is being used against all emails, blogs, comments, They have terrorized me for over eight years now. I can probably expect hell for this comment.
 
EU knows about all these issues and that most real Europeans want to leave Europe and Brussels is doing everything they can to stop all other countries from taking Europeans. They want to block us in here in this new dictatorship they are creating.

Tue, 02/28/2012 - 06:36 | 2203105 Irish66
Irish66's picture

Where will you go?  I wish you and us all the best.

Tue, 02/28/2012 - 07:24 | 2203129 Construct
Construct's picture

My goal is to leave Europe. I am working on it right now. Seeking job outside EU etc.

Tue, 02/28/2012 - 08:07 | 2203174 Phad
Phad's picture

I left for Norway a few years back.

A bit more freedom here, at least the media is more free.

60% higher pay, less tax the first 2 years. 0,5h less working time a day. And many more working benefits.

Tue, 02/28/2012 - 08:29 | 2203185 Construct
Construct's picture

Norway or Turkey is out of the question I am leaving Europe permanently as far away as possible.

The American government knows what Brussels and the Swedish government has done against me. I have been in contact with them many times. Unfortunately they are complicit with Brussels crimes. So I am not going for USA but there are other places. I wont stay in Europe thogh. Those days are now long long gone. I even have the documents to resign my Swedish citizenship and changing my name ready to go. I don't want to go into all the details about what it is they have done against me but lets just say they engage in serious torture like methods. And I wonder how many more victims of this sort of treatment there is out there. I don't believe I am the only one anymore. Everything from stalking, harrasement, sabbotaging carrers, contacting friends, family. Sabbotaging businesses. They did it all against me.

Tue, 02/28/2012 - 11:28 | 2203891 prole
prole's picture

I feel your pain brother but I would love to swap with you.

I would flee to Scandanavia land any time for any reason. if I could only afford to live there. My meager funds would keep me there a few years maybe then send me limping back to Gulag America

Wed, 02/29/2012 - 03:46 | 2207078 Hobbleknee
Hobbleknee's picture

Dude, why?  Are you insane?

Tue, 02/28/2012 - 06:51 | 2203113 Sandmann
Sandmann's picture

It is that bad. Things are about to fall apart in a very bad way

TRUE !  http://www.statewatch.org/

People are simply not awake and have no idea what is going on


Tue, 02/28/2012 - 17:00 | 2205553 Hobbleknee
Hobbleknee's picture

How have they terrorized you?

Tue, 02/28/2012 - 07:03 | 2203120 cnhedge
cnhedge's picture

deleverage will burst the bubble

http://www.jinrongbaike.com/ http://www.cnhedge.com/

Tue, 02/28/2012 - 07:26 | 2203138 THE DORK OF CORK
THE DORK OF CORK's picture

What a disaster this market state has become - we had bubbles of course during the nation state years(8 to 1 leverage) but nothing like this frequency & intensity.

Its the Basle rules / Banking system me thinks - everytime a surplus is created (periphery austerity ?) it gets blown somewhere else.

Tue, 02/28/2012 - 07:58 | 2203163 jmcadg
jmcadg's picture

VV +1 brother

I can only see DM reader scum sat behind the Police barricade chomping down scones and tea, scoffing at the yoof of today. Terribly British you know! Not that they help themselves, if you're gonna riot and steal, don't do it for a pair of Nike's Lol.

Falak pema

London may seem like an island within, however it's rise draws up the rest of the UK which is now at least 50% overpriced. Those London (b)wankers go to the leafy picturesque coastal areas and drop their wads on the counter and buy more over priced bullshit McMansions.

Soon time to price housing in silver not gold!

Tue, 02/28/2012 - 08:09 | 2203176 dumbengineer
dumbengineer's picture

How would these real estate price chart look like if priced in gold ?

Tue, 02/28/2012 - 12:34 | 2204232 EmileLargo
EmileLargo's picture

UK house prices are down 80 percent since 2005 if measured in gold ounces.

Tue, 02/28/2012 - 08:22 | 2203184 EmileLargo
EmileLargo's picture

I used to work in London. The prices ARE nuts. But one cannot look at London in a vacuum. If you ever travel to Asia and look at prices there, you will be amazed. Check out prices in the big cities in China or India or Hong Kong or Singapore and they are mind blowing. Singapore is now more expensive than London for property. When the Asian rich come to London, they do not find the prices all that high. And they pay in hard cash without borrowing from local banks. For the average Londoner today, if you are starting your career doing anything (not necessarily something in finance), you have no hope of ever being able to own a property. I could have bought property in London but wasn't comfortable with the massive debt I would have had to take. Some friends leveraged themselves to the hilt and made out like bandits.

We have had more than a decade of easy money policies. This has driven up prices everywhere. If you made a list of countries where prices have gone through the roof, the list would be very long. This actually underscores that housing in America was not unique - just that sub-prime in America was leveraged to a ridiculous degree and was the weakest link. But there are a lot of weak links everywhere. Find me a country today with a decent economy that doesn't have high proeprty prices. There isn't one.

Tue, 02/28/2012 - 08:24 | 2203187 The Swedish Chef
The Swedish Chef's picture

The Swedish housing bubble is popping as we speak. About time...

 

But this is what you get when you keep rates low and you let the lie of forever rising prices linger on. Your home is a cost, not an investement.

Tue, 02/28/2012 - 08:35 | 2203212 DutchDude
DutchDude's picture

Dutch bubble is fueled by the 0-payment stimulus and the mortgage frenzy when banks loan out 6~7 times your anual wage in mortgage. Middleclass couples could get a mortgage for a way too expensive house.

You only pay interest and the other part of the mortgage is used to save/speculate; hoping you have enough money to pay off the loan. Well that plan sorta failed when the stocks went down. Lots of families are looking at a 50k+ shortage in their mortgage.

Now you can only get a mortgages with max 50% of the amount you don't have to pay off. And you can only get 3~4x your anual wage for a mortgage.

Other thing is the discussion to change the fiscal policy where you can deduct your monthly mortgage from taxes. that's gonna change but nobody knows when en what's gonna change.

Real estate is in a total deadlock at the moment.

Rental market isn't helping either; if you make more then €33k a year; you're not allowed to rent in the cheaper segment, so you either have to rent private, which costs you at least 800 a month, or you have to buy. Avarage house costs 200k but you only get max 4x33k in mortgage. So you have 30 year olds living with their parents, or staying in the cheap rentals which they got when they made less money leaving the real estate market with less and less buyers. I know at least 5 families who have their house for sale for a couple of years now; not capable of lowering prices.

Deathspiral...

Tue, 02/28/2012 - 11:39 | 2203934 steve from virginia
steve from virginia's picture

Article leaves out a key factor: there must be an oversupply of houses at inflated prices.

Right now, there is inflated demand in particular areas within countries, where there is no excess of supply at all. In the US there was an excess of 1 million units carried over year after year starting in 2002. The same 1 million units are weighing on property markets in the US today.

There are excess units in Spain and Ireland. It is hard to find excess housing in Paris or Amsterdam ... or Stockholm, rather a sharp shortage. Particular areas are not the entire country: try to find an apartment in Venice or Florence or Rome, if such things are found they are extraordinarily expensive. In the unfashionable south of Italy housing can be very cheap.

Tue, 02/28/2012 - 12:33 | 2204224 EmileLargo
EmileLargo's picture

Despite this, if you take away people's ability to borrow money easily, the prices always come down. Arguably, there is no "surplus housing" in Tokyo either but prices are 70 percent lower than in 1989 today.

London is an anomlay in that it attracts a lot of foreign buyers but even then, your average property isn't bought by a multimillionaire foreigner. It is bought by someone with a reasonably well paid job and a mortgage. In fact, if you research property prices in London boroughs, most have not exceeded the prices in July 2007 (which was the top of the credit bubble in the UK). So, raise interest rates by even 100 basis points and even the London market comes down a lot. If you factor in the decline of Sterling since 2007, London property has also dropped in real terms.

The authorities will, of course, not allow property prices to fall in the UK. They need the market propped up otherwise the banking system goes down the toilet overnight and half the population will be on benefits (if it isn't already). Ergo, they will kill the currency but keep nominal prices propped up. It is a perverse system.

Wed, 02/29/2012 - 03:43 | 2207076 Hobbleknee
Hobbleknee's picture

Very true, but even in Sweden where shortages are all over, eventually people just can't afford it anymore, even with free money. And as soon as things turn downwawrd, the spiral starts.  Why buy a house today, when it's cheaper tomorrow?

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