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Inefficient markets

Housing blarney

House prices and the planners

House prices are overvalued, say the experts. At least, that’s what they said last year. In the last 12 months, however, the average price of a British home has risen by a further 18 per cent. This doesn’t mean that the housing bears were wrong. Rather, it is a reflection on the inefficiency of the housing market, which in this country might have been designed specifically to provide an endless cycle of booms and busts.

Over the past 50 years, the price of the average house has hovered a little above three times the owner’s…

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