A question for the optimists

Heyman_2

mewbie wrote: »

You're the nearest thing to right we have G.

I'd agree with that - probably the most informed, 'tell it like it is' poster on here tbh.

Generali

Thank you mewbie and Heyman. What nice things to say.

mewbie_2

Graham_Devon wrote: »

Now, we crashed because basically, the banks & we, could no longer carry on this level of indebtness. So, if house prices did bottom in February, and it's rises and small falls from here.....how is it different this time? I.e. what's so different between now and 18 months ago, which means suddenly we can afford this debt, when we couldn't 18 months ago?

I'm not sure I agree with this. The bottom had been supported by BTL mania and FTB's absolutely mortgaging to the max for a few years - because house prices always go up. At some point in a bubble it stops - and OK the credit was the time but I am not sure it was the reason. Stop man in street nowadays and ask about BTL and house prices always going up. Maybe a different answer to two years ago.

So in a shorter answer - sentiment.

edit: I realise this doesn't actually answer your question. er sorry about that.

ess0two

Graham_Devon wrote: »

Hi Guys,

Just wanted to ask this question and start a new thread on it, so we get proper responses from the start. Hopefully thought out opinions too!

So, the premise of the question is: How do you feel that current rises / stagnation now will be supported by the populace?

We have risen back up to £160k or whatever for a property on average. On a 4x salary with a 10% deposit that will require:

- A salary of £36,000, likely with no debts, either joint or singular.
- £16,000 deposit
- £2-10k for fees (dependant on purchases obviously).

So in other words, £20k in the bank is needed really, for the slim chance of getting a 10% deposit mortgage. I recall the average amount of savinsg per person in the country being around £800.

Now, we crashed because basically, the banks & we, could no longer carry on this level of indebtness. So, if house prices did bottom in February, and it's rises and small falls from here.....how is it different this time? I.e. what's so different between now and 18 months ago, which means suddenly we can afford this debt, when we couldn't 18 months ago?

Whats changed? And I mean what's changed that will stay that way. I don't mean obvious interest rates which fluctuate.

Would be interested in your thoughts.

160k average.........some areas of the UK a 3 bed semi can be had for £120k tops.

Heyman_2

Generali wrote: »

Thank you mewbie and Heyman. What nice things to say.

You're welcome. Don't get too used to it though

lostinrates

mewbie wrote: »

I was only jesting, as always.


If you can do it, then why not? There's money, and what might or might not be. And then there's life and stuff.

Sorry mewbie, I'm alittle oversensitive today.

why not, because we haven't found the right place I guess. Its taken alost a year but I'm glad we pulled out on the thing posted here by someone else as ridiculously over priced. (a smell wreck in one 6 with one acre and a habitation order). Although it would be nice to sleep together everynight I don't think I would have been very fulfilled there, in that area or that land: NDG was right, I do need to work, or occupy more mind more. We got very excited aout soething I showed details of to PN, Davesnave, a few others. It was a good size for us (no house though! and planning seemed more difficult than ever there). But as you say, there is life and stuff: an importnat part of our life would have been comprimised there. Pastures hit the nail on the head with that one: it was not that we wanted that property, we wanted ANY property, not a good reason to buy for life. Ther have been a few possibilties, but nothing that makes my knees weak (oh, apart from one out of budget place!)

Now we are on a count down. In March DH's salary goes up (or he's out of a UK job!) and we se stuff we like we could afford on that multiple. There are all lifes normal complications nd comprimises, and prices for what we are lookig at ARE dropping still: or at least being priced amaingly more reasonably. There are two properties, with actual houses on them!, that might on paper suit us. One came on at peak, for £x, the other came on recently, at £x/2. Both good areas, both have a second house for the aged Ps, the cheaper one: three times the amount of land, and very superior prospects and houses. We could afford ( possibly) property two, just. Deposit might be an issue (amazing because I think our cash pool is significant, especially when comapared to price of average house!), but repayments would be makeable, even if my work doesn't take off, but DH is ok, we'd be ok.

Ultimately its probably not the one, but the point is, this is happening at places we are looking at. It probably bings average sales rices up, because many such places aren't hanging desperately like they did last year, (although property two has been advertised for lost four months now).

Graham_Devon

baileysbattlebus wrote: »

Here are some figures for you mull around regarding first time buyers.

The average deposit by FTB's in 2008 was 21.8%, in 2007 it was 17.2%.
The average payment as a % of income in 2008 was 22.7% in 2007 it was 23.5%
http://www.communities.gov.uk/documents/housing/xls/141299.xls

Good figures, and obviously I'm not going to argue with them, but, I will just say, talking about people who could afford it doesn't make the situation for those who can't, in my mind, any better, or detract from the original "where is the money coming from".

It's well known a lot of FTB's at the moment are using the bank of mum and dad, even the paper's and economists are saying that's true.

So although the above figures are correct, they only include those who could afford to buy.

or in a chart

http://www.communities.gov.uk/documents/housing/xls/chart540.xls

The figures come from the Survey of Mortgage Lenders - which I think is conducted by CML. Obviously some FTB's will be putting more down and some will be putting less down than the average figure. The average deposit for an FTB hasn't been 10% for over 10 years.

I believe in 6 months the deposit went from 10.8% on average to 23.4% on average. Theres no way in 6 months someone could just save that much as a percentage. So again, it seems the bank of mum and dad are helping here. I don't think it's actual FTB's saving up deposits. Again, your figures are totally correct, however, again, it misses out everyone else, only including those who can afford.

This set of figures from the same source shows the average advance and the average incomes and the average price paid for FTB's

http://www.communities.gov.uk/documents/housing/xls/141284.xls

It makes quite interesting reading tbh. It's for UK, England, Wales, Scotland Northern Ireland and regional - so it's quite comprehensive.

FTB's Q2 2009 (in England) - average price paid £160.5k, average advance £113.12k - average recorded incomes £40.4k.

To me, it looks as though some FTB's are more than managing to get large deposits together and have done for years. - A quick look at the advances vs income - it looks as if it's been between 2x and 3.5x over 16 years.

I can't really say much more to this bit other than what I said above.

It's a shame the FTB statistics also include those who have STR'd, as you can never get a true picture really of the real FTB.

Generali

Heyman wrote: »

You're welcome. Don't get too used to it though

I won't. I seem to remember posting yesterday that I have a rather thick skin when it comes to the insult side of things. Generally I like to have a thin skin for compliments!

HAMISH_MCTAVISH

ess0two wrote: »

160k average.........some areas of the UK a 3 bed semi can be had for £120k tops.

Indeed.

I always get carried away with Aberdeens property market, which is exceptionally good I'll admit, so I thought I'd take a look around for another mid-market location to compare against.

I found this from the Blackpool Gazette.

Blackpool has enjoyed a 10 per cent rise in prices of semi-detached properties in the second quarter, second only to Cheshire in the North West. The average semi in Blackpool now costs around £121,986.

The average house price nationally has risen 1.7 per cent in value.

Mike Smith, director of McDonald and Company, which has offices in Bispham, Poulton and Blackpool, said: "House sales for first time buyers, of houses priced between £60,000 and £100,000,have definitely improved.

"Although prices of houses over around £200,000 have actually fallen slightly, we hope that the boost from below - the first time buyers - marks the rise out of the recession and into a promising future."

Kirkham-based agent Peter Mooney added: "We are seeing more sales of houses priced between £60,000 and £175,000.

"Banks are being more lenient with loans and first time buyers are finally coming to us with mortgages again.

"The situation is definitely better than it was 18 months ago."

Property experts in Wyre claim that despite a stagnant market for expensive homes, a push from young first time buyers will improve the market.

Sheila Royle, director of Royle Estate Agents based in Cleveleys on Victoria Road East, Thornton, said: "Although the demand for houses more than £250,000 has stayed the same for the last year, many more first time buyers have been making purchases of around £60,000 to £90,000.

"This will mean an improvement in the overall market for the future, as they move up the property ladder.

Proves all my earlier points really......

mewbie_2

lostinrates wrote: »

House conundrums

Difficult decisions, I sympathise. I hate the whole process of purchasing, or selling - never bought a dream property, and then don't want to leave it when moving on.

I still think time will favour those waiting - but hell - I wouldn't want to be in that position.