From: "Chris.S" 
Newsgroups: uk.politics.misc alt.politics.british uk.finance
Subject: Re: King sounds warning over economy. House prices overvalued and bankrupcies risk becoming large social problem.
Date: Wed, 10 May 2006 18:37:49 +0100


"Andy Pandy"  wrote in message
news:4cem6iF15inacU1@individual.net...
>
> "Chris.S"  wrote in message
> news:44621f07$0$9250$ed2619ec@ptn-nntp-reader01.plus.net...
> >
> > "> > > A house is worth what someone will pay for it.
> > >
> > > Well obviously, but you've missed the point. On that basis dot.com
shares
> > weren't
> > > overvalued in 2000.  The point is that he reckons "what people are
willing
> > to pay" is
> > > too high.
> >
> > I would never make the mistake of comparing a asset such as an house
with
> > the dot com shares.
> > They were pretty meaningless as there was no real assets there.
> > with property there is always an asset as people always need homes to
live
> > in don't they.
>
> So what? The principle is the same. Just because an asset is "real" or
"needed"
> doesn't mean it can't be overvalued.

It isn't for the reasons I have explained.

Shares in dot coms where valued at a certain level, but when things got hard
there was nothing behind the businesses, no equity, no capital, nothing

A house is an asset, we can debate what it is worth but it is an asset
particularly as people need them to live in.