House prices are close to affordable levels, reveals survey... BUY!! BUY!!! BUY!!!

PasturesNew

Quick, don't miss out! OMG, house prices are close to affordable. So my advice is buy tomorrow or Wednesday or you'll miss the boat.

Really, next weekend is too far away. Move now! Don't miss out! Don't miss the boat! OMG OMG

http://www.telegraph.co.uk/finance/economics/3227548/House-prices-are-close-to-affordable-levels-reveals-survey.html

*grabs coat*

baby_boomer

That'll be "affordable levels" assuming the 2007 mortgage market still existed

Kez100

They are closer to affordable. Just another 20-30% to go.

Chris2685

I'm ringing them and putting my name down now! Can't miss this!

mitchaa

Prices of around £150k are i would say affordable for an average income family. I believe nationwide is currently at around £165k average.

So i would say... Yes houses are quite closer now to being more affordable.

Another £20k drop max i would say

(Off price of an AVERAGE British home)

IveSeenTheLight

PasturesNew wrote: »

Quick, don't miss out! OMG, house prices are close to affordable. So my advice is buy tomorrow or Wednesday or you'll miss the boat.

Really, next weekend is too far away. Move now! Don't miss out! Don't miss the boat! OMG OMG

http://www.telegraph.co.uk/finance/economics/3227548/House-prices-are-close-to-affordable-levels-reveals-survey.html

*grabs coat*

One senses a hint of sarcasm in the tone of your post.

So despite staistics and reports showing that houses are nearing affordable levels, you obviously disagree.

Looking at specifica areas, I would say that there is some areas that still have quite a bit to drop, others not so much and some that are already at affordable levels.

Looking at th eNationwide graph, it would seem that we are near the long term trend of house prices.




What is in your side is that historically, house prices have overshot the long term trend, so while they may be near affordability, I would expect them to overshoot again past the affordable levels

hethmar

You know, strange how your own perception changes isnt it - last week Id have put money on more huge decreases in house value - down 50% or more and right now, Im really not so sure that will happen. I guess we will know this time next year.

carolt

Well, I know where I'll be putting my money - and it won't be into buying a house any time too soon.

I'd love to see any figures for their affordability index. It's clear that for FTB's, mortgages have not become more affordable - the need for much bigger deposits, and punitive rates for those who don't have them, means that all vendors of would-be FTB properties have no choice but to cut asking prices. Which continues up the chain.

It's clear that until mortgage rates across the board reduce (at the moment, they're still rising, despite rate cuts, except for those on existing tracker mortgages), falling house prices will only match rising costs of finance, so cancelling each other out.

And that's without taking into account the extent to which households are increasingly stretched by the rising costs of living and increasing unemployment.

No - the process of falling house prices has only just got under way - loooong way to go yet, before they could be classed as 'affordable'.

IveSeenTheLight

carolt wrote: »

I'd love to see any figures for their affordability index. It's clear that for FTB's, mortgages have not become more affordable - the need for much bigger deposits, and punitive rates for those who don't have them, means that all vendors of would-be FTB properties have no choice but to cut asking prices. Which continues up the chain.

It's clear that until mortgage rates across the board reduce (at the moment, they're still rising, despite rate cuts, except for those on existing tracker mortgages), falling house prices will only match rising costs of finance, so cancelling each other out.

And that's without taking into account the extent to which households are increasingly stretched by the rising costs of living and increasing unemployment.

No - the process of falling house prices has only just got under way - loooong way to go yet, before they could be classed as 'affordable'.

from the report

Importantly, the index takes into account the cost of mortgages as well as households' disposable incomes, so it reflects the fact that families' costs have increased as a result of the credit crunch.

If as a FTB, you can't afford the deposit, interest rate, become unemployed or increasing living costs (reports are they are coming down now) then maybe its a sign that you cannot afford to buy, full stop.

Sorry to sound harsh, but this is the way it was many years ago and possibly an indicator as to how it will be in the future

The report did not say it was affordable at the moment, only that it is nearer the affordable index medium

The affordability index, in which 100 points represents the average affordability level since the early 1960s and a lower figure means prices are more overvalued, improved from 88.9 points to 93 points. Since reaching a 16-year low affordability level of just under 83 points last year, at the peak of the housing boom, it has improved by around 10pc.

Ms Choyleva said: "The affordability indicator has improved. This is an entirely different situation to the early 1990s. It never hit the same high levels of unaffordability."

Max_Headroom_3

mitchaa wrote: »

Prices of around £150k are i would say affordable for an average income family. I believe nationwide is currently at around £165k average.

So i would say... Yes houses are quite closer now to being more affordable.

Another £20k drop max i would say

(Off price of an AVERAGE British home)

It's interesting to see how people have become conditioned to thinking £150K is "affordable for an average income family".

An average income is about £25K I think, based on that I'd say £100K is genuinely affordable (3.5 x £25K plus a 12% deposit).

Put it another way, I'm earning a reasonable amount over "average", and I wouldn't like to have to repay a six figure mortgage!

I feel that there is a lot of re-calibrating of expectations (both regarding what is really affordable, and what is really a sensible average house price) still to be done in this country.

Realy

Max_Headroom wrote: »

It's interesting to see how people have become conditioned to thinking £150K is "affordable for an average income family".

An average income is about £25K I think, based on that I'd say £100K is genuinely affordable (3.5 x £25K plus a 12% deposit).

Put it another way, I'm earning a reasonable amount over "average", and I wouldn't like to have to repay a six figure mortgage!

I feel that there is a lot of re-calibrating of expectations (both regarding what is really affordable, and what is really a sensible average house price) still to be done in this country.

But you are saying a single person should be able to buy an average house?