What is your house worth, adjusted for wage inflation from 1991?

The House of Lords is looking at the housing market, and probably wont be asked to rock the ever-increasing-prices boat.

But, what is your house worth, at 1991 prices adjusted for wage inflation? You can find out here. We use 1991 prices for council tax, so there has to be some political utility in using that as a baseline.

A reversion towards that norm will likely happen at some point — you only need look at what’s happened to average earnings in the last few years (“Incomes for those of working age remain below pre-crisis levels”). Possibly not all the way, probably not in a single event, but the current assumptions seem to be that eternal hope that things will continue until it is someone else’s problem.

While hoping may work for Government Ministers and Treasury policy staff, it should probably not satisfy the Lords.

How should non-traditional-bank entities be involved to mitigate any collapse in house prices? There will be a material difference between this magnitude of change, and the scope of contingency plans.

If there is massive amounts of negative equity, new forms of co-operatives will become necessary to ensure that people retain places to live. As, if that £700k house suddenly changes hands for £200k, that is £500,000 that has suddenly disappeared from the UK’s balance sheet. How many such transactions does it take to materially impact growth figures? What about those £5m penthouses left unused as a “buy-to-leave” asset?

The impact on UK domestic political priorities will be irrelevant to overseas investors should they choose to extract what remains of their profits.