FTB expectations too high?

Graham_Devon

Maisie11 wrote: »

As we have potentially a £1 million house I would like to comment:

1. You dont buy a £1 million house as a FTB. It has taken us over 25 years to get to this position.

2. As this is a first marriage for both of us and we dont have any children from previous relationships which was not as common 25 years ago as it is now we can afford to totally focus our income on ourselves and our children.

3. We are in excellent health and have insurance if either of us fall ill.

4. We earn a very good salary between us , however this has come about because we have grabbed opportunites, made some good decisions and only had two children. None of this - I have four children and a partner that doesnt work, also I have a child from another relationship but I messed that up - why cant I have a 4-5 bed house on the average wage. In fact I would like to live in a very desirable area and btw I am entitled to it!

Sorry to sound a little tense but making sweeping generalisations doesnt help. Speak to anyone that has a £1 million house and you will find it was not given to them on a plate. Neither was earning well over the average wage.

Maybe you shouldnt use them then?

LillyJ

brummybloke wrote: »

i would actually think 'most' people do not think that a 3 bed semi is an average house.

unless of course by average you mean half way up the housing ladder? in which case i would agree with you.

but then are you saying that 3 x the average wage should right from the off get you half way up the housing ladder?

I do agree with you in a lot of ways, and in Birmingham prices in the rough areas are actually dropping a lot faster (like Weoley Castle is now lots cheaper than Harborne, when it had been catching up).

I think that for a 3 bed semi in a nice part of Harborne to be 3 times average single salary is just ridiculous, because we don't all earn enough to buy in Harborne. If we did, then why would anyone live elsewhere?!
I live on the Selly Oak/Harborne border, but wouldn't want to pay the extra to live near Harborne high street, so we are happy with where we are now, especially as it's our first home. We would like, eventually, to live in Bournville, but it's expensive, and rightly so because it's desirable! I definately never want to live in Weoley Castle/Small Heath/Neechels etc, and neither do lots of other people, hence why it's cheaper to live there!

The house price falls reported in Birmigham are also skewed though, because of the city centre flats dropping and the BTLs in the student areas being sold in desparation.

besonders1

I agree that the crazy lending of the banks has pushed up peoples expectations. In the past a lot of undesirable homes and ex council house properties were always more affordable than the affluent and bigger family homes but because of the success of the housing boom, flats, small FTBs houses are almost as expensive as bigger homes, so many people would go for the best that money can buy. After all why waste money on a small flat if you were going to have children later on and need a house?
I also believe that rough areas and 1 bed flats will reduce rapidly in price as many people will go for the nicer homes. People will start to see its value for what they are worth e.g. the area, people, crime etc rather than just the fact that it is a "cash cow" Nicer areas and larger homes are well worth paying extra for in my opinon so I don't blame FTBs for this.

mewbie_2

Good, so for once we are all agreed and it turns out I was completely right.

Average couple, thirty years old, with or expecting first child should be able to afford an average two/three bedroom property. They should be able to have time off and devote themselves to their kid(s) and each other, without mortgaging themselves to the hilt to achieve it.

I'm so glad to have my opinion vindicated.

PasturesNew

whathavewedone wrote: »

My parents didn't get a family home as soon as they got married. They had a basement flat when my sister was a baby, then a 3 bed semi in a grotty area and finally a 4 bedroom house in a nice area. By the time they got to the 4 bedroom house in a nice area my father was 38 years old. This was 1970, the year I was born.

1970 was the year my dad bought our/their first house. He was 40 and there were three of us aged 8/10/19. It was a 3-bed semi, 2+boxroom. They kept that one until they retired and moved.

whathavewedone

Well if you are in the top 10% of earners in your 20s then I think you would still be able to afford a decent place to live. I know plenty of people earning 70k by their late 20s who were able to afford nice flats (their choice as they were single) in good locations in London. If they had wanted to they could have bought a 3 bed semi in a decent London suburb.

When my parents were in their late 20s my dad wasn't earning a huge amount because he was just starting out in his career. I think it is a relevant example because the majority of people whining on here that they can't afford a 3 bed semi go on to say in the next breath that they are earning 20kish, live in London or the South East and want to get out of their parents' house/rented flat and only have a small amount of savings. They seem to think on a salary of 20k and a deposit of 5-10k that they should be able to buy a grown up family house in a good area.

I think it is unrealistic to expect to be able to buy a family house at a time when you are just starting out in your career - you may have a good job but most of us have to work our way up the salary scale and to me it follows that you can't expect to be able to buy a 3 bedroom house while you are still on starting out wages.

So why not buy a 1 or 2 bed flat or rent and save until you can afford a 3 bed house - and when you actually need one, ie. when you have started a family. You don't actually need a 2 bedroom house until baby is 6 months old and you don't need a 3 bedroom house until you have baby number 2.

Have just looked up my great grandparents on the 1911 census. 2 adults and 6 children lived in 3 rooms, one of which was the kitchen. Not suggesting anyone would like to go back to those days but it does put things into perspective somewhat.

whathavewedone

I appreciate that anecdotes about the 1960s and 1970s are not as impressive as graphs etc.

However, I think people focus too much on looking at the prices of property back then and applying to it to salary multiples, overlooking the fact that mortgages were extremely hard to come by then. The cost of living was high making it difficult to save the deposit needed for a house. What I'm trying to say is: it wasn't easier then to buy a house in your 20s than it is now.

My dad was a white collar worker, an advertising executive but still the only way they got to buy their first house was because my mum inherited some money which they used for the deposit.

By the time I was born my dad had started up his own company and was earning a lot more money - the point is that even back then you had to be earning much more than the average salary to afford a good sized family house in a nice area and you needed to have scrimped and saved for years/inherited money to have a hope in hell of buying a 3 bed semi on an average wage.

mbga9pgf

whathavewedone wrote: »

Well if you are in the top 10% of earners in your 20s then I think you would still be able to afford a decent place to live. I know plenty of people earning 70k by their late 20s who were able to afford nice flats (their choice as they were single) in good locations in London. If they had wanted to they could have bought a 3 bed semi in a decent London suburb.

When my parents were in their late 20s my dad wasn't earning a huge amount because he was just starting out in his career. I think it is a relevant example because the majority of people whining on here that they can't afford a 3 bed semi go on to say in the next breath that they are earning 20kish, live in London or the South East and want to get out of their parents' house/rented flat and only have a small amount of savings. They seem to think on a salary of 20k and a deposit of 5-10k that they should be able to buy a grown up family house in a good area.

I think it is unrealistic to expect to be able to buy a family house at a time when you are just starting out in your career - you may have a good job but most of us have to work our way up the salary scale and to me it follows that you can't expect to be able to buy a 3 bedroom house while you are still on starting out wages.

So why not buy a 1 or 2 bed flat or rent and save until you can afford a 3 bed house - and when you actually need one, ie. when you have started a family. You don't actually need a 2 bedroom house until baby is 6 months old and you don't need a 3 bedroom house until you have baby number 2.

Have just looked up my great grandparents on the 1911 census. 2 adults and 6 children lived in 3 rooms, one of which was the kitchen. Not suggesting anyone would like to go back to those days but it does put things into perspective somewhat.

Hang on, the average salary in London may be a lot higher, which is my whole point regarding median house price vs median salary. Why should someone in the top 10% of earners move into the quintessential average home?

So why not buy a 1 or 2 bed flat or rent and save until you can afford a 3 bed house - and when you actually need one, ie. when you have started a family. You don't actually need a 2 bedroom house until baby is 6 months old and you don't need a 3 bedroom house until you have baby number 2.

becuase that would cost me money. Lots of it and damage my long term financial wealth. So, for now whilst the average property is hissing equity out at 3000 british pounds per month, I think I will keep my big fat healthy deposit to myself until prices return to slightly more sane levels. Only another 15 months to wait!

whathavewedone

Well I don't care what you do personally with your money, that's up to you obviously.

You were the one who brought up the issue of young people who were in the top 10% of earners - the inference seemed to be that the average house was out of their reach.

In fact people who are earning 70k in their twenties will be on considerably more by the time they reach their thirties and then will clearly be aspiring to and able to buy something much better than the average home. Although I'm not actually sure that a 3 bedroom house in a leafy suburb with all that goes with that, low crime and good schools isn't actually a step above the "average" house in any event, whether it's located in southern england, the north west or wherever.

You seem to be missing my main point though which is that it has never been the case that it has been easy for young people on average salaries to get straight in and buy a 3 bedroom house, even when prices were 3 x average salary.

The example that I gave was of people who are high earners in London because I don't know any high earners in other parts of the country. It makes no odds though whether it's 70k in London or 40k in the north east because property prices are higher or lower depending on where you live.

mitchaa

What a silly scenario,

Should an average salary be able to buy an average home is what it boils down too here?

Think about the consequences of Mr average meeting Mrs average, Mr middle income meeting Mrs middle income and Mr high earner meeting Mrs high earner.

Your average couple will be living in homes far bigger than that of a normal 3bed SD property.

Wont get into that 1 again as it's a silly scenario.