Typical wage £20K. Typical house £150K

wolvoman

carolt wrote: »

Yup, my dad was a manual worker on average salary and managed to buy a nice 3 bed semi in a nice zone 3 nw London suburb. On one salary only, as wives' salaries were not allowed to be taken into account.

Price now? 500K+.

Price then? No more than 3 x average manual worker's salary. Let's be generous, and say the average manual worker now earns 30K. (Though I doubt it.) So equivalent value - no more than 100K, allowing for deposit.

But it's 5 x that.

What a loud of nonsense skiTTish's post was.

You're making up numbers.

How on earth can the fair value of a 3-bed semi in a nice part of Zone 3 London be £100k.

When I was househunting a couple of years ago I thought I was in a very strong position with my single income of high 5 figures. Except I then found out that I was competing for properties with couples. These couples have income levels way over £100k a year.
There are hundreds of thousands of these couples in London and they want these 3-bed properties you describe.
And a couple aearning over £100k sitting on £200/£300k of equity from their FTB flats can easily afford your Dad's house.

That's just the way it is.

the_ash_and_the_oak

wolvoman wrote: »

And a couple aearning over £100k sitting on £200/£300k of equity from their FTB flats can easily afford your Dad's house.

That's just the way it is.

The problem imo is that those FTB flats might not be quite so easy to sell over the next few years as they have been the last few

IveSeenTheLight

the_ash_and_the_oak wrote: »

The problem imo is that those FTB flats might not be quite so easy to sell over the next few years as they have been the last few

As the average price of property is lower than they were two years ago, theoretically it should be easier to buy now than it was then (from a capital term)

Of course lending criteria has tightened which will have an affect on the amount of people who can get credit.

The thing about the market is that the price will fluctuate to an extent to adjust to the inbalance of supply and demand.
If supply is not being increased to meet the demand then the price fluctuates to reduce the demand for the property.

the_ash_and_the_oak

IveSeenTheLight wrote: »

As the average price of property is lower than they were two years ago, theoretically it should be easier to buy now than it was then (from a capital term)

Of course lending criteria has tightened which will have an affect on the amount of people who can get credit.

The thing about the market is that the price will fluctuate to an extent to adjust to the inbalance of supply and demand.
If supply is not being increased to meet the demand then the price fluctuates to reduce the demand for the property.

the average price in capital terms was even cheaper in the period carolt was talking about, yet fewer people were able to buy

I mean, this is the thing - prices are cheaper than two years ago yet fewer people are able to afford them

the_ash_and_the_oak

IveSeenTheLight wrote: »

The thing about the market is that the price will fluctuate to an extent to adjust to the inbalance of supply and demand.
If supply is not being increased to meet the demand then the price fluctuates to reduce the demand for the property.

same is also true of credit imo

PasturesNew

lostinrates wrote: »

One of the early crash property programmes featured a woan in Notting Hill, she, like her parents was a market stall holder and was selling a flat for tremendous profit that her parents? or grandparents? had bought. Can anyone remember more than me about that?

I remember the programme being on. It also had one of those orange spivs (too much time on the sunbed) who had made loadsamoney in the area. Whichever one he is, he said he'd stopped buying a few years ago I think.

I can't remember the programme or the presenter though. I'm useless with names.

The_White_Horse

chucky wrote: »

12% to 15% mortgage interest vs 5% mortgage interest - it wasn't cheap back in the good old days... and that was for those that could get a mortgage :rolleyes:

12% interest on 100k = 1000 per month

5% interest on 500k = 2083 per month

they were still better off.

and whilst interest rates hit the 12-15 peak for a short period, aveareg interest rates were more like 8%.

Give me 8% on a 100k home over 5% on a 500k home (which is actually the same home!!!) anyday!

chucky

The_White_Horse wrote: »

12% interest on 100k = 1000 per month

5% interest on 500k = 2083 per month

they were still better off.

and whilst interest rates hit the 12-15 peak for a short period, aveareg interest rates were more like 8%.

Give me 8% on a 100k home over 5% on a 500k home (which is actually the same home!!!) anyday!

you've missed the point tonto

the house was worth £100k - that house isn't and was never worth £500k
the value of the house was made up from posters in lalala land:T

where have you seen 500% HPI in 10 years without wages increasing

lieutenant_dan

Whether owner occupancy was lower 30 years ago to now is besides the point.

The point is it was still POSSIBLE for low salary workers to buy houses, that's houses, not flats in that era. The same can not be said for
low salary workers now in any part of the country, and if there were low earning first time buyers who did manage to secure a mortgage in recent times, probably only did so through a falsely declared self cert mortgage, or a mortgage on a multiple of six times the salary.

the_ash_and_the_oak

The_White_Horse wrote: »

12% interest on 100k = 1000 per month

5% interest on 500k = 2083 per month

they were still better off.

and whilst interest rates hit the 12-15 peak for a short period, aveareg interest rates were more like 8%.

Give me 8% on a 100k home over 5% on a 500k home (which is actually the same home!!!) anyday!

tbf they're prob paying the 1000 and the 2083 on different salaries imo