What do you predict?

TD5

IveSeenTheLight wrote: »

Which area are you referring to?
According to HBOS, the last time the UK average was below £60k was Q2 1988.
http://www.hbosplc.com/economy/includes/09_10_08historicdata.xls
That's more than 20 years ago!!! or a 68% drop required to return to those figures 60K figures or 73% to return to 50k figures

Granted some areas will be below the UK average.
The North was below £60k in Q3 2001 (7 years ago or a further 57% drop required for 60k or 64% for 50k)

Question: Do people regard a decent 3 bed terraced house as an 'average' property?

£85k based on UK average in 2000:j

Kez100

£99,999, just to get into the right section of Rightmove.

Kez100

IveSeenTheLight wrote: »

Which area are you referring to?
According to HBOS, the last time the UK average was below £60k was Q2 1988.
http://www.hbosplc.com/economy/includes/09_10_08historicdata.xls
That's more than 20 years ago!!! or a 68% drop required to return to those figures 60K figures or 73% to return to 50k figures

Granted some areas will be below the UK average.
The North was below £60k in Q3 2001 (7 years ago or a further 57% drop required for 60k or 64% for 50k)

Question: Do people regard a decent 3 bed terraced house as an 'average' property?

I did when I bought one as my first home. Parents first home (centuries ago) was a 4 bed victorian terrace. All have just normal jobs.

Flats and two beds should be the cheaper than average options IMO (apart from London etc where flats are common place)

mummyfrugal

150 k ..... but few houses will be for sale cos people can't sell at negative equity and wont wanna be repossessed so they will stick for long term.

IveSeenTheLight

TD5 wrote: »

£85k based on UK average in 2000:j

You think prices will return to 2000 level.;)
Based on what?

According to the following graph, the 2000 price was below the long term trend of house prices.
The real house price trend is circa 150k, which a lot of people have said in this thread and would appear to be what the average should be.



That said, historically it can be seen that when prices drop, they overshoot the long term trend and could go lower.
The graph shows that hardly ever does house prices follow the trend line

mitchaa

moneymass wrote: »

House prices will return to what people are able to afford.

This is what banks will hand out.

No more liar loans/mortgage fraud, no more 100+% LTV. 10 % min deposit and proof of income. Sensible multiples of salary.

So, Average Salary*~3.5 with a 10 % deposit.

My 'guess' is that in 2 years time we'll be near the bottom for which the above model will be used/ more common place

And I think the above will show the trend towards the median house price in 2 years, average of course will be slighty higher.

Common misconception than an average wage should be enough to be able to buy an average home:D

No it shouldn't, 2 x average wages should be enough to buy an average home;)

1 x average wage should be enough to buy you a 1bed/2bed flat

Average salary per person = £25k, average houshold income is £38k

2 x average x 3.5 multiple will give you a mortgage of £175k + 10% deposit and you're speaking of nearly £195k.

3.5 x £38k + 10% deposit and we are speaking of £150k (ish)

So homes are affordable for the average household at £150k levels. This sub £100k for average homes is ludicrous thinking.

Chris2685

£38k average income? Where did you pull that figure from?

According to the office of national statistics, in 2006/07 it was just under 30k http://www.statistics.gov.uk/cci/nugget.asp?id=334

andys15

Chris2685 wrote: »

£38k average income? Where did you pull that figure from?

According to the office of national statistics, in 2006/07 it was just under 30k http://www.statistics.gov.uk/cci/nugget.asp?id=334

average household income is 38k i, not average income which is about £28000

mitchaa

Chris2685 wrote: »

£38k average income? Where did you pull that figure from?

According to the office of national statistics, in 2006/07 it was just under 30k http://www.statistics.gov.uk/cci/nugget.asp?id=334

That info is misleading as it involves benefits, look at the difference between the original/final income lines, there's hardly a difference.

Final income of just under £30k in hand remember is a lot more than that in gross. To earn £28k in net, you would need to earn £38k in gross.

A family ''earning'' £28k in untaxed benefits is exactly the same as a family in work earning £38k. That link clearly shows average household income after deductions stands at just under £30k

Mortgages based on gross earnings.

Anyway, that article is totally misleading and old now, it's now 08/09.

Ill try and dig out where i got the £38k figure from.

When you think about it, its, a believable figure, average Joe on £25k and the PT mother on £12/13k

Chris2685

But those figures are based on gross, and are based on household incomes (not single income).

Fair enough it is a couple of years old, but I doubt income has risen 8k in 2 years...