Abandoned hope for all ye FTBs

dopester

Buyers seeking first home are giving up hope, says leading property expert

By David Prosser
Monday, 25 May 2009

The housing market remains mired in recession because seven in 10 first-time buyers have given up hope of ever owning their own homes, a leading property analyst said today.

http://www.independent.co.uk/news/business/news/buyers-seeking-first-home-are-giving-up-hope-says-leading-property-expert-1690496.html

Except for the headline, which I can imagine is very true, a pretty rubbish article. FTBs should need any interfering help, which is only to prop up prices, such as from the government in the form of homebuyer-shared ownership schemes, or forcing banks to lend at mega-multiples.

We just want the market to play out as it should.

That includes those who own their homes outright but can't get by on savings and then JSA, having to sell and downsize - if they can't find another job to beat JSA and can't keep up anything like their old lifestyles.

Not having JSA boosted to fancy heights to make them comfy to pay bills and car and whatever. I've never heard of anything so ridiculous. :mad:

Not whilst graduates are being told to take call-centre jobs or migrate and try and find work abroad - and UK house prices are so ridiculously expensive.

[Deleted User]

In the `old` days we saved and saved hard for a deposit ie we did without other things . Different times and different mentality. Nothing was handed to us on a plate and many of us did two jobs to get the mortgage deposit together. It can be done these days too but takes sacrifice and commitment

IveSeenTheLight

kittie wrote: »

In the `old` days we saved and saved hard for a deposit ie we did without other things . Different times and different mentality. Nothing was handed to us on a plate and many of us did two jobs to get the mortgage deposit together. It can be done these days too but takes sacrifice and commitment

Very nice reality check, thank you.
:T

There are reports that affordability is now back "on average" to 2002 levels.

http://www.lloydsbankinggroup.com/media/pdfs/halifax/280409FTBAffordabilityReview2009Q1Final.pdf


http://www.lloydsbankinggroup.com/media/excel/01_05_09Affordability.xls

FTBers have been able to buy since 2002 and theoretically can buy again although accepted that it may still be difficult in some areas.

IveSeenTheLight

It would seem through a little more reading that while affordability of properties is vastly improved, its the ability to secure loans that are the problem.

It makes sense that there is more a need for lending to be eased than prices to drop.

e.g. a £150,000 property requireing a 20% deposit means that £30,000 is required. If that property dropped 20% i.e.a drop by £30k, the buyer would still require £24k, thus only a £6k saving in order to have the means to secure the funds for a property (agreed that it also means less to pay back)

If however the lending eased such that only a 10% deposit was required, then immediately, the potential buyer only needs £15k for the deposit

With the Libor rates dramatically reducing and more in line with the BoE rate, I wonder if more mortgage loans will start to be seen in the market.

mbga9pgf

IveSeenTheLight wrote: »

It would seem through a little more reading that while affordability of properties is vastly improved, its the ability to secure loans that are the problem.

It makes sense that there is more a need for lending to be eased than prices to drop.

e.g. a £150,000 property requireing a 20% deposit means that £30,000 is required. If that property dropped 20% i.e.a drop by £30k, the buyer would still require £24k, thus only a £6k saving in order to have the means to secure the funds for a property (agreed that it also means less to pay back)

If however the lending eased such that only a 10% deposit was required, then immediately, the potential buyer only needs £15k for the deposit

With the Libor rates dramatically reducing and more in line with the BoE rate, I wonder if more mortgage loans will start to be seen in the market.

Not with 10% deposit requirements they wont. :rotfl::rotfl:

Why would you ask for a 10% deposit when the lenders know prices have another 20-25% to drop?

penguine

IveSeenTheLight wrote: »

It would seem through a little more reading that while affordability of properties is vastly improved, its the ability to secure loans that are the problem.

This "affordability" line currently being bandied about really amuses me. Really, it's just that "unaffordability" has slightly decreased, not that "affordability" has vastly improved.

a_rather_tall_man

kittie wrote: »

In the `old` days we saved and saved hard for a deposit ie we did without other things . Different times and different mentality. Nothing was handed to us on a plate and many of us did two jobs to get the mortgage deposit together. It can be done these days too but takes sacrifice and commitment

Might have been possible a before the recession kicked off but right now I know people struggling to find one job let alone two.

pickles110564

kittie wrote: »

In the `old` days we saved and saved hard for a deposit ie we did without other things . Different times and different mentality. Nothing was handed to us on a plate and many of us did two jobs to get the mortgage deposit together. It can be done these days too but takes sacrifice and commitment

This posting is a breath of fresh air, Dopester and the others want it all their own way without doing any of the hard work.

pickles110564

a_rather_tall_man wrote: »

Might have been possible a before the recession kicked off but right now I know people struggling to find one job let alone two.

So what were you doing before the recession kicked in? Always something or someone to blame other than yourself.

pickles110564

mbga9pgf wrote: »

Not with 10% deposit requirements they wont. :rotfl::rotfl:

Why would you ask for a 10% deposit when the lenders know prices have another 20-25% to drop?

Not according to the article in the NOTW, it states that the country and housing is over the worse now.

IveSeenTheLight

penguine wrote: »

This "affordability" line currently being bandied about really amuses me. Really, it's just that "unaffordability" has slightly decreased, not that "affordability" has vastly improved.

slight decrease or dramatically improved?

http://www.lloydsbankinggroup.com/media/excel/01_05_09Affordability.xls

According tot he above link the UK has a house price to earning ratio of 4.35, down from a peak of 5.86 and is much nearer the long term 26 year average of 4.02.

Some areas are showing ratios under a 4.00 ration of 3.73 (Scotland), 3.76 (Y & H) & 3.80 (NWest)

Sure there are still some areas very high i.e. 5.62 (N Irleand) and 5.42 (SWest), but overall, there is in my opinion a dramatic change in the affordability ratios