Moneyweek: UK House Prices in Terms of Ounces of Silver
Moneyweek’s Dominic Frisby writes that he is detecting a certain amount of bullishness in the UK housing market. People with cash are talking about buying to take advantage of lower property prices and interest rates. Nevertheless, he says,
“But it’s a mistake to buy now. It’s a big, big bull trap…”
He asks the question, how many ounces of silver does it take to buy the average UK home?
Here is a log version of the same chart.
When silver spiked to $50 in 1980, you could buy the average UK house for one thousand ounces of silver. A thousand ounces of silver now costs about £10,000, while the average UK house is now about £150,000.
Looking at the above charts, a reversion to the long-term average of 5,000 ounces for the average home looks likely. But if precious metals mania sweeps the globe as the financial crisis continues, who knows? Once again we may see 1,000 ounces for the average UK home.