What does 'Property Bubble' mean?
Property Bubble
A property bubble occurs when property prices rise to an unsustainable level. When they drop back down the 'bubble has burst'. Note a bubble only occurs when the above happens in isolation from other factors.
As such there has never actually been a property bubble in the UK as value drops only occurred when the wider economy goes into recession. This compares with the dot-com bubble which burst even though the rest of the economy (and house prices) continued to grow.
Search Results for 'property bubble' in How to Really Buy a Property
"... predictions for the property market (and who doesn't);
How the market works over the short term and the long term;
The difference between property bubbles and property booms;
Why it can be a good idea to buy when prices are falling;
The principles of buying a property to let and what the..."
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Chapter 4:
Understanding the Property Market
"... attacks on the World Trade Centre, the war in Iraq in 2003 and the Credit Crunch of 2008.
For more information on this is and how it affects the market see the chapter property bubbles and Market Crashes..."
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Chapter 6:
Property Bubbles and Market Crashes
"... In many countries, including the UK, protecting property prices from large falls was part of that plan and a political necessity.
- property bubbles -
Bubbles are often confused with booms and crucially property booms are often misreported as property bubbles.
For a property bubble..."
"... from large falls was part of that plan and a political necessity.
- Property Bubbles -
Bubbles are often confused with booms and crucially property booms are often misreported as property bubbles.
For a property bubble to occur real estate must be over valued by the market in isolation...."
"... as property bubbles.
For a property bubble to occur real estate must be over valued by the market in isolation. If, in 2008, the economy had continued to grow but house prices had started to drop then it could be said that there had been a property bubble.
A perfect example of a real..."
"...Understand the difference between a boom and a bubble and you realize that there has never actually been a property bubble in the UK. The early nineties saw houses prices fall as the economy moved into recession and rose as it came out the other side. The same events followed the 2008 downturn and in both cases changes in value from peak to trough were less than 20% . British property follows the business cycle of Boom and Bust rather than a separate and isolated Bubble and Burst.
..."
"...This is not to say the property bubble concept isn't valid and it does occur. Ireland was a striking example where prices moved up ever higher from the turn of the millennium. The collapse in values, approximately 50% from their peak, was far greater than the general recession of the country or any reduction in GDP. The business cycle had moved to the bust phases but real estate was much more than just bust, it was a burst bubble.
..."
"...Booms and busts are different from bubbles and bursts but they are often mixed up by the media. In Britain there has never been a true property bubble which burst on a national scale but it has happened locally. Instead property prices follow the booms and busts of the business cycle and a way to predict this accurately has yet to be found.
..."
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