BBC News - First Time Buyers Are Rich?

dgwebster

So I was just reading this article on the BBC News website:

http://news.bbc.co.uk/1/hi/scotland/8004114.stm

What greatly amused me was at the very end:

"First-time buyers now spend an average of £445 a month on mortgage repayments, representing 11.2% of the household income.
In 2000 the average repayment was £252, or 9.6% of their income."


I am currently renting at a little over £400 a month but are astounded that in the average home, this should be about 11% of my income... thats a monthly household income of £3700 per month.


Fair enough i am the only earner since my partner was made redundant last year but still, if i take the figure we earned before that happened, it was still 22% of the income, double what they have here and thats on the average wage of everyone I know. On my own, our rent is 40% of my income.


So I would love to meet this average that makes it 11% because i have never seen people made out of thin air before.

mitchaa

dgwebster wrote: »

So I was just reading this article on the BBC News website:

http://news.bbc.co.uk/1/hi/scotland/8004114.stm

What greatly amused me was at the very end:

"First-time buyers now spend an average of £445 a month on mortgage repayments, representing 11.2% of the household income.
In 2000 the average repayment was £252, or 9.6% of their income."


I am currently renting at a little over £400 a month but are astounded that in the average home, this should be about 11% of my income... thats a monthly household income of £3700 per month.


Fair enough i am the only earner since my partner was made redundant last year but still, if i take the figure we earned before that happened, it was still 22% of the income, double what they have here and thats on the average wage of everyone I know. On my own, our rent is 40% of my income.


So I would love to meet this average that makes it 11% because i have never seen people made out of thin air before.

£4000 /100 = £40 x 11.2 = £448

So the average household income is £4000 That's like a joint income of around £66-67k

Alex_LS

Net or gross?

Graham_Devon

It doesnt make much sense.

The story says they are really struggling, with the average house price being £96,835.

Yet on the other hand, the story makes it look as if average income is 4k per month or 48k a year.

It also says they need a deposit of 20k to buy these £96k homes.

Well whats the problem? Going on the story only, average 96k is 2x average household income.

Think someones got their sums wrong! Or, they have taken the UK average and used that against the scottish average in the house price above. Which doesnt work.

StevieJ

My mortgage was £440 in 1989 and RPI is up around 80% since then, interest rates were 15% though :eek: I am surprised it is so low.

Castleman

Most people I know that are renting or paying off their FTB mortgage, aged <30, are paying more like 40% of monthly income!

baileysbattlebus

Daughter and partner FTB's in south east - mortgage repayment £900

Income 1 £32000 - take home £2000

Income 2 £21000 - taken home £1400

Roughly 25% of take home

to rent a similar house in the same area would cost roughly the same.

k_bagpuss

I'm just waiting to complete on my first house too. Current rent for a small 2 bed flat in Newcastle is £495 pcm. Mortgage is going to be £950 pcm. Mind you, it is a Scotland report so not sure how relevant it is to other area's

shellnapier

well im from scotlando
out take home per month ME 600
partner S/E - Averaged 1600
so thats 2200 before tax a amonth mortgage quote we have been given £380 a month

what percentage si taht?

Cleaver

shellnapier wrote: »

well im from scotlando
out take home per month ME 600
partner S/E - Averaged 1600
so thats 2200 before tax a amonth mortgage quote we have been given £380 a month

what percentage si taht?

Maybe one of the new questions mortgage providers should ask new customers is whether they can understand basic maths and finance principles, such as working out simple percentages.

It's around 17%.

mewbie_2

Cleaver wrote: »

Maybe one of the new questions mortgage providers should ask new customers is whether they can understand basic maths and finance principles, such as working out simple percentages.

It's around 17%.

I make it 225.3754128%? I guess that's the difference with Open Source software.