Law #1: All bubbles need a catalyst, like a stone to throw into a still pond. Bubbles start in “good times”, typically GDP is going up and people have money to spend and invest, so money starts chasing assets and if it takes time for the supply of those assets to increase, prices go up. For example, the fundamental price of housing long-term is exactly equal to nominal GDP per house divided by a function of long-term interest...

The U.K. commercial property market is in the middle of its worst slump on record and won’t recover for at least another two years, a report by the Royal Institution of Chartered Surveyors showed. Values for offices, stores and industrial properties may fall 25 percent by the end of 2010 as the economic recession causes rental growth to slow and property vacancies to increase, the London-based firm said. That would bring the decline...

THE SUPER-RICH are different from the rich, as anyone reading about the divorce of Mr and Mrs Abramovich will have noticed. Will she get £1.5 billion or just £150 million? The townhouse or the super-dacha in West Sussex? Oenophiles will be wondering who will win custody of the extensive and expensive wine collection that the couple doubtless possess. “We have noticed a growing demand for homes with wine cellars,” says Lucy Russell,...

Oligarchs favour trophy homes of white stucco with their own parking in Chelsea, Belgravia and Mayfair, but the price must be right Economic chills, including large stock market falls, have severely diminished the once prodigious spending power of the Russian oligarchs, but some can still afford to treat themselves to such British status-symbols as white-stuccoed houses in Belgravia, newspapers and the rest. The price must be right,...