3x income

ad9898_3

novazombie wrote: »

Some friends of mine are on 25K per year, thats the family income both working. They have always rented nice houses about 600pcm but now want to buy, because they are fed up with having to move everytime they have problems with the landlord/rent etc.

They can olny get a mortgage for 75K and dont have any savings. I think they are typical family in the UK right now.

Do you think they will be able to buy a house in the next few yrs?

This is a ridiculous situation, you household income is around the national average, yet you can't buy an average house ?, you had better find yourself a 6x income mortgage then, because only when hell freezes over will the average house drop below 145k.

ukcarper

I think a lot depends on where you live I bought my house first house in the seventies and one average wage was not enough to buy an average house then.

Really2

Graham_Devon wrote: »

LOL, I wouldn't say equal opportunties stopped it!

I would agree though that 2 wages just meant more money coming in, which just meant everything got more expensive.

Misconception there Graham do you think 2 wages equal twice as much money or do you think two people now have to work for the equivalent of what was a good wage back then:)

I agree with equal opportunity's, but all it did was spread payroll not double it.

Really2

ad9898 wrote: »

This is a ridiculous situation, you household income is around the national average, yet you can't buy an average house ?,

Naughty, you know 25K is not the average for a combined income.;)

jodlebug

This is becoming a more popular option. My neighbour is shared ownership - about 10 in our street of 80. Built 3 years ago. it is a 3 bedroom house, ensuite to master another double and one single bedroom, bathroom, Lounge and huge kitchen diner. Carpeted by the housing association so its just a case of move right in. This has sold for £100K. 50% share. They also do 25% share if you buy from new.
A 2 bed further in the village are selling for about 65- 85 depending on size and there are also flats. They are all in nice areas and dont look any different from other houses in the street. There are only a few per development so it is a case of get on the waiting list but there doesnt seem to be a long list at the moment round here (bedfordshire) people are only waiting a couple of months.

They would need to make the deposit though. Then they could buy more as their income increases.

mitchaa

novazombie wrote: »

Some friends of mine are on 25K per year, thats the family income both working. They have always rented nice houses about 600pcm but now want to buy, because they are fed up with having to move everytime they have problems with the landlord/rent etc.

They can olny get a mortgage for 75K and dont have any savings. I think they are typical family in the UK right now.

Do you think they will be able to buy a house in the next few yrs?

Where has the mythical 3x figure come from? As far as i am concerned it only exists in the mindset of some of the posters on this forum.

What banks/building societies are only lending at a maximum of 3x as i could probably draw up a list of 50 lenders or so who offer more.

£25k joint income for a couple is minimum wage work, and as such they are being unrealistic wanting to buy property.

Graham_Devon

mitchaa wrote: »

£25k joint income for a couple is minimum wage work, and as such they are being unrealistic wanting to buy property.

Why? Why is it unrealistic?

Two people, working, shouldnt be able to buy a starter home?

Isn't that a bit of a crazy world we live in? You can have a better prperty on benefits than you can going to work all year?

You do realise that if you set the bar at say 38k average wage, the bar just keeps getting higher and higher as we say "well they shouldnt be able to buy because they aint got a better job".

We have just witnessed this, where the bar to get on the ladder kept getting higher and higher as people already with houses enjoying their equity expected others to find more and more to buy their first property.

It got so bad that at one point in 2007 here, you would need to be earning 65k per year and have no debts to buy a starter home.

So where are you setting the bar? If it's above the point of 2 people who are working full time, where do you want it set? Cus once you set the minimum income level to buy a house, it just keeps getting higher and higher, until.....pop.

Really2

Graham_Devon wrote: »

Why? Why is it unrealistic?

Two people, working, shouldnt be able to buy a starter home?

Graham should you be able to buy with your first wage packet at 18?

If the answer is yes I am worried.

Minimum wage is unskilled or fist jobs in a caffe etc. They are not average wages, add to that because of the low earnings they are likely to struggle with the debt do you think it is wise?

We did minimum wage mortgages in 2007 at 100-125%. turned out they were called sub-prime.

Ps the bar is getting lower with HPC but it aint going to get low enough for everyone on the minimum wage to buy a house.
There are not enough houses!!!!

pps bar is currently set at a max by most banks of 3X joint income, then affordability.
That is a MAXIMUM.
The Minimum is set by demand not banks.

StevieJ

Really2 wrote: »

Naughty, you know 25K is not the average for a combined income.;)

What do you mean ! What has the truth got to do with anything

Dan:_4

Graham_Devon wrote: »

Why? Why is it unrealistic?

Two people, working, shouldnt be able to buy a starter home?

Isn't that a bit of a crazy world we live in? You can have a better prperty on benefits than you can going to work all year?

You do realise that if you set the bar at say 38k average wage, the bar just keeps getting higher and higher as we say "well they shouldnt be able to buy because they aint got a better job".

We have just witnessed this, where the bar to get on the ladder kept getting higher and higher as people already with houses enjoying their equity expected others to find more and more to buy their first property.

It got so bad that at one point in 2007 here, you would need to be earning 65k per year and have no debts to buy a starter home.

So where are you setting the bar? If it's above the point of 2 people who are working full time, where do you want it set? Cus once you set the minimum income level to buy a house, it just keeps getting higher and higher, until.....pop.

Graham...There are two many industry variables to implement a blanket 'one rule fits all' rule.

Someone earning 25K will be able to afford a house. Someone else earning 35K might not be able to. It all comes down to individual circumstances.