When you say a simplistic analysis bear in mind I?m trying to get across a point in a few lines. If you want to go into detail feel free. I would feel happy to have the conversation with you at whatever level you like.

Perhaps you could start by explaining why you think house prices doubled in 7 years?

In my belief its because the money supply has grown at an unsustainable rate, take a look at M4 in this BoE report: (page 9)
http://www.bankofengland.co.uk/publicati...r09feb.pdf
Is one of any number of BoE reports that show you expansion in Broad money. Notice how the period of rapidly expanding M4 also relates to the period which house prices doubled. I have to ask where did you think all this extra money was going? Were people somehow removing this extra money from the economy by withdrawing cash and burning it? Well actually I know they didn?t do that because we don?t see a corresponding spike in M0. I argue, that the extra money bided up the factors of production, principally land, although also certain wages mainly in the City and public sector spending.

I get to the figures I mention simply by assuming a trend rate across those years and looking at the figures (you can do this by downloading the BoE spreadsheets and putting in your own numbers)

I?m not sure what you consider to be one sided about that, in fact I just don?t understand your point? People have always bought and sold houses to each other, it?s just that in the last 10 years people thought they could get rich doing so. So please explain how prices got so high and I can counter no doubt.

Regards a bet I believe this can be done on betfair. I will investigate the options and get back to you. I?m not prepared to specify an exact percentage amount of fall on a given date as of course there is a far higher likelyhood of variance. But what about that average house prices as quoted by the land registry and expressed through the BBC webpage being a lower figure on 31st of December 2010 than at 30 April 2009. Which for the avoidance of doubt is currently ?205,372: http://news.bbc.co.uk/1/shared/spl/hi/in...houses.stm

Or if you prefer a large wager we could use a local solicitor to hold an amount in a custodian account. I would prefer in some sort of interest bearing national saving vehicle such as premium bonds, or index linked bonds.

No doubt your want me to commit to an absolute 50% fall on a fix date, that could easily be missed even if I am right ultimately but wrong on my timing. But on a simple even money prices going up or down in 20 months from today for ?100 I have no objection.
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