Hey guys,

I’ve been spending a lot of time talking about inflation and the effect it will have on the economic downturn that the world is presently experiencing.

Firstly let me say that all of my property contacts around the world; Aussie, South Africa, Kiwi (that’s New Zealand), Dubai, Spain, US and Singapore are all saying the same things. Things are ‘off the boil’ but all of them including the US are saying that things are not as bad as they thought they could have gotten and all are predicting recovery in the next 18 months - 2 years.

OK so onto Inflation because I had one of the investors that I was chatting to yesterday saying that it doesn’t matter that inflation was high because it is only food and fuel and not the consumer spending on the high street. So that won’t mean interest rates need to increase.

>>> The article continues below <<<

Want even more property ideas?

People just like you are looking for a simple and secure way to invest in property without the need to spend countless researching, building relationships and managing the process of buying.

Our mission is dead simple: to give you all the free education you need in one newsletter so you can begin the process of building your property investment portfolio -- whether or not you purchase property through us.

Begin the process right away -- enter your details here to receive Brett's 'set and forget' property ideas newsletter, emailed direct to you weekly.

Your first name: (req)	Your last name: (req)
Your email address: (req)	Your contact number: (req)
And finally, in an attempt to reduce the level of spam we’re receiving through this signup page, could you please answer this simple question: What does 1 + 1 equal?

(Note: This is a private mailing list and will never be sold or given away for any reason. You can also unsubscribe at any time.)

I hate to say but this is a very limited view of the effects of inflation. You see the fear is that if fuel and food prices are increasing this in turn means that the delivery companies will need to increase prices to keep profit margins. Of course they will pass this onto say the prices on the High St who are ordering their stock (which has also gone up because of the costs of the raw food product.)

This means that you and I are going to pay more of our wages into the High St thereby causing inflation on the High St.

In the medium term this will put pressure on wages (wage inflation) which will further add to the inflation rate and mean that the Bank of England will have no choice but to put up interest rates.

Personally, I think the long term prospects are very positive, we simply are not building enough properties to meet the demand. The target was around 250,000 per year (Barker Report 2002) but this year they are saying about 110,000 and next year 100,000. This point above all else will prohibit prices dropping massively.

So if people are telling you that inflation is not an issue, well I can see their perspective but I also think there are huge risks of inflation getting out of control.

Live with passion,

Brett Alegre-Wood

Latest blogs

• See all...
  • The perfect complement to your off-plan purchase: the deposit bond
  • Brett and Arlene's Wedding Photos.
  • My new book cover: Have your say!
  • New Video: Weekly Property Update - 11th Nov 2008
  • Dirty Rotten Bast&^ds... Important message for those with a flexible facility.