Macro Economics

Macro Economics

House prices in England and Wales versus rents and other cost of home ownership

This chart shows that: The cost of electricity, gas and other fuels has risen much more strongly than house prices. House prices represent good value versus energy costs. Rents and maintenance costs have kept pace with with house prices. The volatility of capital prices v consistency of rental growth. Rents tend not to fall as house prices can. Relative to each other, house prices, rents and maintenance cost the same today as they did in 2003 and 2008. How your point can be proved by choosing the time period.

Home Are prudent savers finally wising up in their search for yield? I read in the Sunday Times (2.2.14) “Savers pull £43bn from fixed rate accounts” (last year), apparently 15.2% of the money held in fixed rate and notice accounts according to the Bank of England. The article quotes analysts who are preparing for rate rises as unemployment falls and economic growth puts pressure on officials to move the Bank rate from its record low of 0.5%. The Centre for Economics and Business Research is quoted as expecting the Bank rate to reach 1% by the year end. We'll see. The big question is when will rates normalise? Dusting off my text books (read Google-ing), the components of interest rate: Nominal Interest Rate = Real...