Sam9

Hi Akrasia, I don't think I said that interest rates prevent inflation only that they have helped people to keep hold of their homes in this recession unlike last time around. I also haven't said that we'll return to pre-recession conditions at the first sign of growth. You're quite right there are a lot of elements to managing the economy it's a tightrope walk to recovery. I'm not an economist so I'll leave it there. I feel like I am paying attention and I don't see why news of predicted growth in the economy isn't good news! Can I ask your predictions for house prices in 2010?

Yesterday Britain and Australia were officially declared out of recession, that is we both had growth of 0.5% in the last quarter. A reason to be cheerful I think! Some people think that the market will crash again and go further than before but consider how bleak things looked the middle of last year, pretty dire stuff!! Everything came to a halt and no one could predict when it would start to recover. The picture looks far brighter now and although unemployment is a set the raise through next year i don't believe we could be in worse shape than last year. What labour and the bank of England did by lowering interest rates was to save us from the complete disaster a la the 80s because it was crippling inflation and subsequent flood of people losing their houses that was the nail in the coffin. Too many people have too much money riding on it to let that happen again, we'd all be in serious trouble! What would have to happen to the economy to make people sell at 50% less than the peak?! It doesn't even bear thinking about and what would interest rates look like and the availability of finance, not first time buyer friendly that's for sure! Whether or not it's for the best long term I believe we've seen the lowest house prices already and I really hope I'm right!

I think there is little chance of prices falling dramatically because as soon as they drop a bit people with money (and there are still plenty of those people about) start buying again. We're a small island and we love property! Even if the market is flooded with repossessions as more people are made redundant I seriously doubt that prices will fall much lower than they did at the beginning of this year. Desirable property will always hold a premium and not so desirable property has a rental value investors can't resist. Between people with equity in their current property and investors they'll keep prices up. For most their home is now a long term investment and savings plan. There's little scope for short term gains unless you are a very good developer (Mrs Beeny!!). As a side note I just had my flat valued and 2 agents and it was valued it the same as I bought it for in March 2007.

I agree if Lisa wins that's it for me and BB no more!! She's done nothing but keep her head down and smoke fags in the garden. If everyone did that there'd but nothing to watch! The irrepressible dark horse deserves to win, Marcus all the way!