Now that everyone is renting their music and cars
Discussion
The key part of that graph is "low to middle income households"
The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
kiethton said:
The key part of that graph is "low to middle income households"
The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
Really? I thought the key part of the graph was where a low-middle income first time buyer needs to save nearly 7x longer for their deposit in 2017, compared to 1997. My mistake. The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
lad I work with wants a house, but says he can't afford one... when I look at what he's looking at, it's 'nice' houses in a decent location....totally unrealistic.
I bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
I bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
budgie smuggler said:
kiethton said:
The key part of that graph is "low to middle income households"
The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
Really? I thought the key part of the graph was where a low-middle income first time buyer needs to save nearly 7x longer for their deposit in 2017, compared to 1997. My mistake. The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
Looking at the ability of the poorest to buy is always a flawed argument, especially when UK property (especially in London) is a global commodity.
theguvernor15 said:
You're left with in the region of £400 towards saving for a deposit.
I've looked at Rightmove & something that looks 'okish' locally is going to set you back around £180k.
With both of you saving as above for a 10% deposit, it's going to take you the best part of 2 years to save the deposit, let alone the additional required to furnish, pay the solocitors fees etc.
I know a lot of people who don't even earn as much as the figures above as they're in un-skilled roles (secretarial/general office etc/delivery driver etc.)
Only 2 years to save a deposit?? What are you complaining about?I've looked at Rightmove & something that looks 'okish' locally is going to set you back around £180k.
With both of you saving as above for a 10% deposit, it's going to take you the best part of 2 years to save the deposit, let alone the additional required to furnish, pay the solocitors fees etc.
I know a lot of people who don't even earn as much as the figures above as they're in un-skilled roles (secretarial/general office etc/delivery driver etc.)
If you want to own your own home then it should be a challenge. Too many people ( as has been said on this thread) want it all now.
As for wanting a house in the South East ..... If you cannot afford it then buy further out. Too many people wanting houses close to London over the decades have pushed the values up and the more that want a house in a London postcode, the more the price will go up.
People are naturally greedy.
I live in the North East and the divide between North and South is increasing. It does not bother me as I am retired and have no plans to move but the younger ones are going to have to move south in stages if they want to be close to London and that might take 30 years. What is wrong with that? We do not have the high salaries up north so tend not to have the house price pressures that the south has.
My gransfather could not afford a house in Hampstead in the 1920's but could afford one in Walthamstow (£500 for a 3 bed terrace).
In the 1980's I could not afford Walthamstow but could afford Bury St Edmunds.
My grandfathers old house recently sold for £1.1 million (several owners later).
Just my opinion.
kiethton said:
budgie smuggler said:
kiethton said:
The key part of that graph is "low to middle income households"
The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
Really? I thought the key part of the graph was where a low-middle income first time buyer needs to save nearly 7x longer for their deposit in 2017, compared to 1997. My mistake. The majority, even 20 years ago wouldn't have been in a position to buy so should be excluded....Until a few decades ago social housing completions were 1/3 of the market - this is where this section of "purchasers" (if you could call them that) would go.
The best version of that chart are the "middle to high earners" - the 0.45 to 0.85 percentile (ignore the +0.85 as they'd be given it) - these are the people that would normally be in a position to actually buy a home.
Looking at the ability of the poorest to buy is always a flawed argument, especially when UK property (especially in London) is a global commodity.
Our first house ( mid terraced 2 up 2 down ) cost 29k i think we smashed the overtime at work for a month possibly 2 to get the deposit and legal fees together.
I think at 1 point in the 2000's we were paying 6% interest but it was affordable as the house was cheap and the loan was low.
No way a postie and nurse could to that now as 1st time buyers.
dirty boy said:
lad I work with wants a house, but says he can't afford one... when I look at what he's looking at, it's 'nice' houses in a decent location....totally unrealistic.
I bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
I wonder how much is down to parents not wanting them to leave and be left alone together?I bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
theguvernor15 said:
Of my group of friends there is a mix of renters/owners (however it's mainly the latter). Late 20/early 30s.
ALL of my close friends who have houses have done so by contributions from parents/inheritance towards deposits.
I was very fortunate to be given a small amount by my parents to help with the deposit, although i saved the majority of it myself, my girlfriend saved her share, although she was in a higher earning job, whilst living at home.
The main issue is that once you get to a certain age, you don't really want to live at home & you want freedom, so you move out, however it's very hard to rent & save a deposit at the same time.
I looked at what our mortgage would get us if we rented locally & it'd get you a knackered 2 bed terrace in the worst part of town.
I look at a lot of 'non-skilled' jobs local to me, say the average salary for something more than a receptionist, but not a CEO is £25,000 PA.
Bare with me on the fag packet maths below, based on 2 sharing p/month:
Take Home £1700
Rent: £350ea
Household bills: £200
Car: £150
Car Insurance: £50
Food: £200
Other bills (mobile etc): £100
Allow £200 P/Month for some socialising/clothing/holiday/un-forseen circumstances (repair bills, car etc).
The above figures don't allow for things like CSA either or any other debts/bills.
You're left with in the region of £400 towards saving for a deposit.
I've looked at Rightmove & something that looks 'okish' locally is going to set you back around £180k.
With both of you saving as above for a 10% deposit, it's going to take you the best part of 2 years to save the deposit, let alone the additional required to furnish, pay the solocitors fees etc.
I know a lot of people who don't even earn as much as the figures above as they're in un-skilled roles (secretarial/general office etc/delivery driver etc.)
Not sure what point you are making. You saying its only going to take 2 years to save a deposit? What are you waiting for? Get it done, get a house bought. You are in a MUCH better position than a of of people by virtue of the fact you can buy a house for £180K.ALL of my close friends who have houses have done so by contributions from parents/inheritance towards deposits.
I was very fortunate to be given a small amount by my parents to help with the deposit, although i saved the majority of it myself, my girlfriend saved her share, although she was in a higher earning job, whilst living at home.
The main issue is that once you get to a certain age, you don't really want to live at home & you want freedom, so you move out, however it's very hard to rent & save a deposit at the same time.
I looked at what our mortgage would get us if we rented locally & it'd get you a knackered 2 bed terrace in the worst part of town.
I look at a lot of 'non-skilled' jobs local to me, say the average salary for something more than a receptionist, but not a CEO is £25,000 PA.
Bare with me on the fag packet maths below, based on 2 sharing p/month:
Take Home £1700
Rent: £350ea
Household bills: £200
Car: £150
Car Insurance: £50
Food: £200
Other bills (mobile etc): £100
Allow £200 P/Month for some socialising/clothing/holiday/un-forseen circumstances (repair bills, car etc).
The above figures don't allow for things like CSA either or any other debts/bills.
You're left with in the region of £400 towards saving for a deposit.
I've looked at Rightmove & something that looks 'okish' locally is going to set you back around £180k.
With both of you saving as above for a 10% deposit, it's going to take you the best part of 2 years to save the deposit, let alone the additional required to furnish, pay the solocitors fees etc.
I know a lot of people who don't even earn as much as the figures above as they're in un-skilled roles (secretarial/general office etc/delivery driver etc.)
WolfieBot said:
So buy the knackered 2 bed end of terrace, do it up and in 2-3 years you can sell it for a much better equity on the next place, rather than holding out for the okish place.
That's how the majority of my friends including me have managed it.
As did my parents 30 years ago, it's not a new concept, just most people now think they should be able to afford a nice 2 bed on a new build estate.
Indeed so. Legions of people in this country think they are financial geniuses for making money on their houses but in reality all they have done is benefit from house price inflation. Then when they turn around to try & buy the next/bigger property they find that the gap to where they want to go is even bigger than it used to be!That's how the majority of my friends including me have managed it.
As did my parents 30 years ago, it's not a new concept, just most people now think they should be able to afford a nice 2 bed on a new build estate.
There's only two ways you build real equity in property IMO - either buy something and change or improve it or buy something in an area where prices are accelerating faster than average (and then eventually move elsewhere!).
On a slightly different but related note, I've often thought that if the government wanted to do something useful to improve social (and general) mobility in this country they could do a lot worse than scrapping stamp duty for 1st home residential property transactions. Its much too expensive to move house & it stops people being able to relocate. House moving also creates a lot of economic activity & consumption.
Wombat3 said:
On a slightly different but related note, I've often thought that if the government wanted to do something useful to improve social (and general) mobility in this country they could do a lot worse than scrapping stamp duty for 1st home residential property transactions.
It's almost like they were listening before you even said it...https://www.gov.uk/government/publications/stamp-d...
TooMany2cvs said:
Wombat3 said:
On a slightly different but related note, I've often thought that if the government wanted to do something useful to improve social (and general) mobility in this country they could do a lot worse than scrapping stamp duty for 1st home residential property transactions.
It's almost like they were listening before you even said it...https://www.gov.uk/government/publications/stamp-d...
25 grand in tax just for the privilege of buying a £500K property is idiotic in terms of its economic impact & the impediment to mobility it creates. Its also a chunk of the reason why we have the house price inflation we do. People feel they need the value of the property to go up just to make back the cost of buying the bloody thing!
Wombat3 said:
25 grand in tax just for the privilege of buying a £500K property is idiotic
Umm, you seem to have exaggerated the SDLT payable by 2/3.Wombat3 said:
Its also a chunk of the reason why we have the house price inflation we do. People feel they need the value of the property to go up just to make back the cost of buying the bloody thing!
<scratches head> So people somehow force other people to pay far more than those other people want to, simply to get back some cost that's long since paid and forgotten?budgie smuggler said:
I'd like to know how those bemoaning "generation snowflake" would interpret this graph:
If you got on the ladder before '98 you were playing the game of life on easy mode. Even at low to moderate income, and saving just 5% of disposable income, a first time buyer could buy a house in 3 years
Interpretation:If you got on the ladder before '98 you were playing the game of life on easy mode. Even at low to moderate income, and saving just 5% of disposable income, a first time buyer could buy a house in 3 years
Point 3 on the chart is where Labour take control of the housing market and remove key regulations that were in place to prevent house price inflation by restricting who banks can lend to.
Point 26 is where the lunacy of unfettered lending comes home to roost and the Conservatives put these vital regulations back in place.
What also didn’t help in the time period between 3 and 26 is that at the same time as the Govt created unfettered lender so as to synthesise an economic boom and generate higher tax receipts and make everyone happy the very wealthy Boomer generation were at peak income and with huge pensions and having been stylised by Thatcher’s 80s property dream were very keen to invest in residential property. And the third big impact was the growth of London into one of the major global metropolis and the billions in overseas capital that attracted to the London resi market all adding to the ripple effect to the regions.
Over the exact same period we had the enormous impact on low to middle wages in the regions of the mass immigration of cheaper more competitive labour that kept wage inflation in abayance and the further removal of retail debt restrictions that allowed poor people to synthesise wage inflation by borrowing money and fuelling a consumer spending boom that has been large enough to structurally change society.
The period in that chart of excessive growth was 100% a result of central govt deliberately removing vital lending restrictions to fuel a synthetic economic boom.
Now, post 2009 the Conservatives may have generally been just another bucket of turd but the one thing they have done correctly is to redress manybof the contributing factors to that boom and bust. They’ve reinstated key lending restrictions, put in place strategic taxation that penalises the top end of the market and speculators and have to date managed to curb the problem without triggering a crash. And people have had nearly a decade now to get their personal debt in order sufficiently that those who haven’t can be left to burn without needing bailing out to the detriment of others.
The key issue now is that the middle to low end of the employment spectrum needs wage inflation. To all intents and purposesbit has had none for nearly two decades. At the same time we are in the upward cycle of rates now. This is the real danger zone. But a tool to help curb the impact of wage inflation pushing rates higher than the economy can cope with is consumer lending. As wage inflation occurs to temper its impact on the economy we can legislate against consumer lending more and more so as to remove excess spending power from the market as it is increased by wage growth. That will be the right rope that needs to be walked over the next decade.
It isn’t possible to bring house prices down via any sane means other than to slow its growth through govt policy and taxation while returning wage inflation and reducing consumer debt facilities so that income climbs from its artificially deflated levels.
Ricky146a said:
Only 2 years to save a deposit?? What are you complaining about?
If you want to own your own home then it should be a challenge. Too many people ( as has been said on this thread) want it all now.
As for wanting a house in the South East ..... If you cannot afford it then buy further out. Too many people wanting houses close to London over the decades have pushed the values up and the more that want a house in a London postcode, the more the price will go up.
People are naturally greedy.
I live in the North East and the divide between North and South is increasing. It does not bother me as I am retired and have no plans to move but the younger ones are going to have to move south in stages if they want to be close to London and that might take 30 years. What is wrong with that? We do not have the high salaries up north so tend not to have the house price pressures that the south has.
My gransfather could not afford a house in Hampstead in the 1920's but could afford one in Walthamstow (£500 for a 3 bed terrace).
In the 1980's I could not afford Walthamstow but could afford Bury St Edmunds.
My grandfathers old house recently sold for £1.1 million (several owners later).
Just my opinion.
If you want to own your own home then it should be a challenge. Too many people ( as has been said on this thread) want it all now.
As for wanting a house in the South East ..... If you cannot afford it then buy further out. Too many people wanting houses close to London over the decades have pushed the values up and the more that want a house in a London postcode, the more the price will go up.
People are naturally greedy.
I live in the North East and the divide between North and South is increasing. It does not bother me as I am retired and have no plans to move but the younger ones are going to have to move south in stages if they want to be close to London and that might take 30 years. What is wrong with that? We do not have the high salaries up north so tend not to have the house price pressures that the south has.
My gransfather could not afford a house in Hampstead in the 1920's but could afford one in Walthamstow (£500 for a 3 bed terrace).
In the 1980's I could not afford Walthamstow but could afford Bury St Edmunds.
My grandfathers old house recently sold for £1.1 million (several owners later).
Just my opinion.
monkfish1 said:
Not sure what point you are making. You saying its only going to take 2 years to save a deposit? What are you waiting for? Get it done, get a house bought. You are in a MUCH better position than a of of people by virtue of the fact you can buy a house for £180K.
There wasn't really much point other than me saying it'd take a couple of years to save for a deposit.I've saved for a deposit for a house deposit 2x now.
The first time i had to spend it on solicitors fees in the family court & the second time i managed it whilst also renting, so it's easily possible.
And i wasn't actually talking about SE prices, but the SE.
We have friends who live in Hertfordshire & it's frightening how much they need to save for a deposit! (Sum wise, not percentage wise).
E36GUY said:
No way. I don't have a Mortgage and when I do for our extension, it'll be a tiny little fraction of what it would cost to rent the equivalent size.
Presumably that is because you have built up a lot of equity in the house though?I can't see too many people who are already established on the housing market selling up to rent, but for new entrants it could be quite attractive.
If I was in that position and was looking for a 2 bed flat, it would cost me £500k to buy or £1,500 a month to rent. Mortgage rates are cheap, so it is still cheaper to buy at the moment, but house prices have been shooting up and rental prices haven't.
If I was making the same choice in 10 years time and the same flat cost £1m to buy or £2,000 a month to rent, I might be forced to choose to rent.
(Not saying that is what I think will happen by the way).
monkfish1 said:
Not sure what point you are making. You saying its only going to take 2 years to save a deposit? What are you waiting for? Get it done, get a house bought. You are in a MUCH better position than a of of people by virtue of the fact you can buy a house for £180K.
The South East is mental for house prices, to the extent that depsite the fact I could earn (significantly) more in London, I wouldn't move there as I'd hardly see it. You can get a 3 bed in a not-scummy area for £200K or so here, in a scummy area they can be half that sometimes! £200k within commute of London would barely buy a parking space.dirty boy said:
lad I work with wants a house, but says he can't afford one... when I look at what he's looking at, it's 'nice' houses in a decent location....totally unrealistic.
I bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
Except nowadays he'll be competing with some BTL'er or speculator competing to buy the same house so they can rent it out / flip itI bought my first house at 21 and the day after we moved in, there was a dead body found in the back alley of my house...
I'd gone from living with parents in a 5 bed detached house with fields to rear, to a 2 up 2 down distaster in a deprived postcode...however, I could cycle out of town to my work place and it was mine.
Too many of the youngsters in the office don't seem to want to step down from what cosy life they have at home.
Oakey said:
Except nowadays he'll be competing with some BTL'er or speculator competing to buy the same house so they can rent it out / flip it
Increased margin requirements and additional taxes on BTL speculators has helped an awful lot. There was certainly a period when it seemed most FTB suitable properties were being hoovered up by speculators but they’ve been whacked quite nicely with some intelligent changes and while the sensible investors remain I really don’t think the competition is anywhere near what it once was. Gassing Station | Homes, Gardens and DIY | Top of Page | What's New | My Stuff