Typical wage £20K. Typical house £150K

PasturesNew

HAMISH_MCTAVISH wrote: »

So 50% of male earners earn MORE THAN £21,300. (sort of blows a hole in the 20K is a good wage theory....)

And flats start at 45K, and houses start at under 100K?????

Sorry, I'm not seeing why he's moaning about it.

There are more factors than that though. The area's not got a good reputation. Most jobs are seasonal. You have to go a long way for a "proper town". Not many actual jobs. I suspect most of those wages are earnt in towns 20-30 miles away, so locally you're restricted to minimum wage jobs in chambermaiding and ice cream sales in the summer.

It's not a thriving area.

I suspect a lot of the people are self-employed, running small shops and hotels etc. So most employment is from their own business, not employing people. So as an employee the choices are limited.

But if you grew up in the area, are settled there, and young, it's not out of the question to establish yourself.

Max_Headroom_3

People can twist it all they like, the common sense fact is that there has to be a basic relationship between a typical house and a typical wage. Because the people living in the typical houses are paying for them with a typical wage.

For sure you can say "well they'll have to live in two bed flats in scummy areas" (and there are some really scummy areas) but then who's living in/paying for the average family houses, 2/3 bed terraces in poorer (but not scummy) areas? They can't all be people who've built up equity, fresh blood has to come from somewhere.

Affordibility is, was, and always will be the ultimate reckoner. Because ultimately the people can't pay more than they can afford.

All the theoratical logic in the world won't change that, any more than it did during the boom time when certain people were claiming it couldn't possibly crash. Just before it crashed.

HAMISH_MCTAVISH

PasturesNew wrote: »

There are more factors than that though. The area's not got a good reputation. Most jobs are seasonal. You have to go a long way for a "proper town". Not many actual jobs. I suspect most of those wages are earnt in towns 20-30 miles away, so locally you're restricted to minimum wage jobs in chambermaiding and ice cream sales in the summer.

It's not a thriving area.

I suspect a lot of the people are self-employed, running small shops and hotels etc. So most employment is from their own business, not employing people. So as an employee the choices are limited.

But if you grew up in the area, are settled there, and young, it's not out of the question to establish yourself.

And that's fair enough.

But we established the facts.

50% of males in full time employment in that area earn more than £21,300.

50% of females in that area in full time employment earn more than £18,300.

So the fact is that a 20K wage is far from being considered "decent", it's barely average.

And a dual income couple will be on right around 40K.

And flats start at 45K, and houses start at less than 100K.

So again, I'm just not seeing why this is a problem??????

The facts simply do not support the exagerrated 7 times salary nonsense that the OP has been posting.

It's just not true.

HAMISH_MCTAVISH

Max_Headroom wrote: »

Because the people living in the typical houses are paying for them with a typical wage.

No, they're not!!!!!

The full time average wage includes all the minimum wage earners, who will never buy a house and live in council houses.

Only the top earning 70% are likely house buyers. So their average wage is much higher.

And then you double it for couples......

They can't all be people who've built up equity, fresh blood has to come from somewhere.

They are the fresh blood.

People that bought a cheap flat when young, and didn't blow the money on rent instead. They build equity. They can afford a house 10 years later with a decent deposit.

Affordibility is, was, and always will be the ultimate reckoner. Because ultimately the people can't pay more than they can afford.

And that's why prices still have a lot of rises in them yet. Because at peak, the average mortgage payment was 38% of after tax income. Today it's 29%. In 1990, it was 68%.

All the theoratical logic in the world won't change that, any more than it did during the boom time when certain people were claiming it couldn't possibly crash. Just before it crashed.

And then it recovered, at double digit annualised rates, in the middle of the worst recession for decades, with unemployment rising, and with the media relentlessly crash ramping all last winter.

tommy75

The bank manager, the mortgage adviser, the greedy estate agent and the former working class chance BTLer were sat in a pub. The bank manager takes a sip of his cognac and turns to the other men. "I know, once we have driven up prices with liar loans and silly wage multiples, we can buy up lots of houses with the stupid publics bail out cash. We can then rent these houses to the working class who can't afford to buy anything anymore. 21st century slaves". Everybody pats the bank manager on the back. "What a super idea" blurts the mortgage adviser and the greedy estate agent as they hold hands. Up pipes the former working class chance BTLer "I'm so lucky to be here, I'll never have to work again!" The bank manager turns to him and says "You are very lucky, but we need a few of you to make it work otherwise we have no argument on MSE, Once we make profit from each working class family we can buy up more and more homes, It will never fail..."

The perfect plan.

Max_Headroom_3

tommy75 wrote: »

The bank manager, the mortgage adviser, the greedy estate agent and the former working class chance BTLer were sat in a pub. The bank manager takes a sip of his cognac and turns to the other men. "I know, once we have driven up prices with liar loans and silly wage multiples, we can buy up lots of houses with the stupid publics bail out cash. We can then rent these houses to the working class who can't afford to buy anything anymore. 21st century slaves". Everybody pats the bank manager on the back. "What a super idea" blurts the mortgage adviser and the greedy estate agent as they hold hands. Up pipes the former working class chance BTLer "I'm so lucky to be here, I'll never have to work again!" The bank manager turns to him and says "You are very lucky, but we need a few of you to make it work otherwise we have no argument on MSE, Once we make profit from each working class family we can buy up more and more homes, It will never fail..."

The perfect plan.

It worked for the Wilsons! :T


Oh, wait....

Max_Headroom_3

HAMISH_MCTAVISH wrote: »

50% of males in full time employment in that area earn more than £21,300.

50% of females in that area in full time employment earn more than £18,300.

.

I'm sorry but you're absolutely wrong. :cool:

Mr.Brown_4

Having read the headline and scanned the arguments I would like to venture a thought if I may. If, on a common sense seat-of-the-pants gut feel measure, house prices seem too expensive, then they probably are.

No need for the minutiae of every detail. As the rather excellent and amusing hamster on the insurance advert puts it. Simples.

PasturesNew

HAMISH_MCTAVISH wrote: »

The full time average wage includes all the minimum wage earners, who will never buy a house and live in council houses.

I am not sure where you think these council houses would come from. Where I grew up there were no council homes for singles.

Looking again at Max' area, for council housing (bearing in mind that many people don't go on the list as they know there's no chance for them to get one), 8.7% of all households are on the waiting list, which is above the England average of 8.2% (Source: communities.gov)

Most people will be in private rental. The LHA rates there are:
1 bed self contained: £422/month
2 beds: £546
3 beds: £645
But there is a shortage of places to privately rent as it's more lucrative to rent out to tourists, or they're owned as 2nd homes.

MrsE_2

Max_Headroom wrote: »

At seven times salary multiples?

In Surrey the average Surrey house is 10 x the average Surrey wage packet.