House Price Increases-what for?

julieq

Mewbie is DEFINITELY Carol, they both EXPLODE in apoplexy at EXACTLY the same moment.

Graham is however unique. No-one else is capable of sustaining a Devonian argument past the point where it actually starts hurting my ribs.

mewbie_2

julieq wrote: »

Mewbie is DEFINITELY Carol, they both EXPLODE in apoplexy at EXACTLY the same moment.

Graham is however unique. No-one else is capable of sustaining a Devonian argument past the point where it actually starts hurting my ribs.

Oh no... rumbled. Now what?

Graham_Devon

julieq wrote: »

Mewbie is DEFINITELY Carol, they both EXPLODE in apoplexy at EXACTLY the same moment.

Graham is however unique. No-one else is capable of sustaining a Devonian argument past the point where it actually starts hurting my ribs.

Julie is the only person I know who see's the optimism in absolutely everything, tries to baffle everyone else to show this optimism and claims time after time she's not bullish and is "on the fence".

Just can't disagree if your male

bumpoowee

tara747 wrote: »

If there was no HPI, nobody would buy a house with a mortgage because it wouldn’t be worth paying interest. Everyone would just save up as close as possible to 100% of the value and buy outright, without worrying that house prices would rise too fast and become unaffordable. Why would you pay 2-3x the price of your house in interest if you didn’t have to???

Sorry if someone’s already said this, haven’t read the rest of the thread yet.

Come on now you're not thinking this through. There needs to be HPI, in line with RPI so that houses maintain their value, however there most certainly does not need to be HPI over the rate of RPI, where would it end anyway in your proposed economic model?

People take out mortgages because they don't want to wait 20 years to save up to buy a house, and bring up families in rented accomodation in the meantime. They take out mortgages because the can't save up due to paying rent. The take out mortgages because the standard of private rentals in this country is appalling. and so on.

tara747

bumpoowee wrote: »

Come on now you're not thinking this through. There needs to be HPI, in line with RPI so that houses maintain their value, however there most certainly does not need to be HPI over the rate of RPI, where would it end anyway in your proposed economic model?

People take out mortgages because they don't want to wait 20 years to save up to buy a house, and bring up families in rented accomodation in the meantime. They take out mortgages because the can't save up due to paying rent. The take out mortgages because the standard of private rentals in this country is appalling. and so on.

I was answering LydiaJ's post which stated 'if there was no HPI' - see above.

p.s. did you think through your username? :rotfl:

bumpoowee

tara747 wrote: »

I was answering LydiaJ's post which stated 'if there was no HPI' - see above.

p.s. did you think through your username? :rotfl:

Oh right so you didn't mean what you said then? I can never tell on these forums!

And yes I did think my username through, it's based on a true story.

Really2

Graham_Devon wrote: »

Right, cool.

So average wage was 2k, average house was £4874.

Average LTV was 2.4% (I think!), which looks about right.

No the average wage in 1975 was around £2K average house was £10.3K

Graham_Devon

Really2 wrote: »

No the average wage in 1975 was around £2K average house was £10.3K

I was talking about 1970, my fault on that one, but smy theory, which no one can refute still applies!

Really2

Graham_Devon wrote: »

I was talking about 1970, my fault on that one, but smy theory, which no one can refute still applies!

But it seems the average wage vs the average house seems to be 4-5X

But in the real world you average first time buyer earns over the average wage but buys a property under the average cost around 2.5X - 3X income.

So it looks fairly self governing throughout recent history.

Graham_Devon

Really2 wrote: »

But it seems the average wage vs the average house seems to be 4-5X

But in the real world you average first time buyer earns over the average wage but buys a property under the average cost around 2.5X - 3X income.

So it looks fairly self governing throughout recent history.

True, the LTV is somewhate distorted at the moment due to the large deposits FTB's seem to be bringing to the market, thanks to mum and dad, who, it appears, only got rich through HPI in a majority of cases.

These FTB's could simply not buy otherwise. 80% of FTB's with cash from mum and dad is a huge percentage. But that doesn't mean their actual LTV's are lower, just means they wouldnt even have an LTV without mum and dad.

I know, I'm arguing for the sake of it. But hey, least it's backed up with something