FT analysis of error in calculating rental costs
http://www.ft.com/cms/s/0/09894118-a899-11e4-bd17-00144feab7...
When housing is 50% of your budget, I really don't see how a "drop in sea fares" is very relevant...
http://www.ft.com/cms/s/0/09894118-a899-11e4-bd17-00144feab7...
When housing is 50% of your budget, I really don't see how a "drop in sea fares" is very relevant...
For a UK citizen buying a home (or renting cheaply and saving) is the thing to do. It is the first step along the way to retirement. It's the only thing that matters.
If housing is cheap we are rich. If housing is expensive we are poor.
Hell, the fact that 'stuff' is getting cheaper may well be because demand is repressed by the fact that everyone is scrambling to pay the rent and has no disposable income.
I maintain that the price of stuff is totally irrelevant. We can live without stuff (regardless of whether the average person actually does). We can't live without shelter.
Food is not expensive. It is expensive when you have already spent all of your money on housing and transport, obviously. (It is about 10% of min wage in UK).
That's kind of the point I'm trying to make; if housing is cheap then inflation is actually a reasonable metric. If it takes up most of your income it is really just a measure of 'how much the things you already cannot afford are increasing by'.
When you have a stable home, spending money is fine! Until you do, every pence spent is just taking you further away from that stability.