Housing Affordability has peaked, now decreasing

Thrugelmir

HAMISH_MCTAVISH wrote: »

250,000 additional households a year being created, 80,000 houses a year being built.

The picture is clear.

The picture is far from clear.

Locally one the new major developments consisting of around 10,000 units has had its completion date pushed back to 2014. Yet currently only a 1,000 units are now occupied.

Why?

There was a designated growth area so the Government asked for a vast number of houses to be built.

Now there's been major job losses in the area. Unemployment has doubled within 12 months. Many major employers are only employing on short term contracts. The demand for housing is behind the building schedule.

Graham_Devon

I do buy the demand for housing stuff. It's real.

However, I also see brand new developments sitting there for 2 years or more, empty. Theres one local to me, a new hospital was built, and part of that site was designated to funky styled flats, around 60 of them. They have been completed for over a year, but only 8 flats occupied (according to someone who works at the hospital, who I work with).

The others are still in the for sale phase, with nice pictures of their funky kitchens and bathrooms etc.

You'd think that if demand was so high, within 2 years, these would have gone, they were for sale before the recession.

Opposite the entrance to the hopsital there is a road, the road that goes to nowhere but a turning bay. That road was designed around the plots for further housing. Nothing has ever happened. So presumably all underground work such as drainage and services was put in.

So if demand is so high, howcome demand is so, well....low? Or to put it in other terms, howcome empty properties are sitting there actively trying to sell and land designed for more has been left?

jojo1964

Graham_Devon wrote: »

I do buy the demand for housing stuff. It's real.

However, I also see brand new developments sitting there for 2 years or more, empty. Theres one local to me, a new hospital was built, and part of that site was designated to funky styled flats, around 60 of them. They have been completed for over a year, but only 8 flats occupied (according to someone who works at the hospital, who I work with).

The others are still in the for sale phase, with nice pictures of their funky kitchens and bathrooms etc.

You'd think that if demand was so high, within 2 years, these would have gone, they were for sale before the recession.

Opposite the entrance to the hopsital there is a road, the road that goes to nowhere but a turning bay. That road was designed around the plots for further housing. Nothing has ever happened. So presumably all underground work such as drainage and services was put in.

So if demand is so high, howcome demand is so, well....low? Or to put it in other terms, howcome empty properties are sitting there actively trying to sell and land designed for more has been left?

Its dependant on area, type of property etc.

Graham_Devon

jojo1964 wrote: »

Its dependant on area, type of property etc.

Well the area is a big area, hence the hospital.

The type of property, yes, I get this, but demand for these was very high hence building so many.

Hamish talks as if demand will always be the biggest thing. So I'm wondering why demand hasn't worked here. Demand is demand. Surely if, as he says, all these families need houses, they would be in them, regardless of the property type, as desperation forces your hand. But they are not, so where they all living?!

This is the thing, I do buy the demand argument, but not to the extremities pushed on here at times.

JonnyBravo

jojo1964 wrote: »

Its dependant on area, type of property etc.

and price, and ability to pay....

jojo1964

Graham_Devon wrote: »

Well the area is a big area, hence the hospital.

The type of property, yes, I get this, but demand for these was very high hence building so many.

Hamish talks as if demand will always be the biggest thing. So I'm wondering why demand hasn't worked here. Demand is demand. Surely if, as he says, all these families need houses, they would be in them, regardless of the property type, as desperation forces your hand. But they are not, so where they all living?!

This is the thing, I do buy the demand argument, but not to the extremities pushed on here at times.

What part of Britain are we talking about? the largest rise in the population has been to London and the South East, which has also seen the largest house price rises over the last decade or so.

As for demand, this shows where the demand is coming from.

There were 25.7 million households in the UK in 2008, a rise of almost
25 per cent since the 1981 Census though the population
grew by only nine per cent over the same period. While the number of
multi-person households (that is, households containing more than one
person) rose by just 12 per cent over this period, the number of single
person households rose by 73 per cent (from 4.3 million to 7.5 million).
Much of this rise in single person households is a result of people of
working age being increasingly likely to live alone. In 1981,
approximately two-thirds of single person households consisted of people
over state pension age, but by 2008 this had fallen to approximately half;
this is partly a result of better survival of couples to old age. It is
projected that the number of households in the UK will rise to 30 million
by 2021. This growth is driven by an increase in single person
households, accounting for almost two thirds of the increase. The
increase in single person households is larger for older ages, particularly
for those aged 75 and over. It also relates to changes in partnership
behaviour, so that by 2021 single person households will account for
over one third of all households.

There were 25.7 million households in the UK in 2008,

Graham_Devon

JonnyBravo wrote: »

and price, and ability to pay....

Bingo!

Ridiculous prices.

The demand argument has been pushed so far, that some were even talking of 50 year mortgages. Thats all fine and lovely, but when you have these places just sititng here, and it will be the same all over the country, I cannot relate to the supply and demand (and supply being too low) being the be all and end all.

treliac

jojo1964 wrote: »

Young people will only make up a small number of those looking for housing, immigration will be a more important factor in house price rises, the buy-to-let market will still be profitable, with transient workers needing short term housing, and those that settle will be looking to purchase family homes and bring their families over,and whilst the population continues to rise and house building fails to keep up with demand, prices will continue to rise at best, or remain stagnant at worse, of course there will be fluctuations short term, but over a 5 or 10 year period the trend will continue to be upwards, only a more catastrophic recession will affect this, as generally most people have been largely unaffected by the current recession, in fact for millions the recession has been beneficial with lower interest rates, lower prices etc.

High demand for housing doesn't necessarily translate into ability to buy, either for self or as BTL. I doubt the influencing factors as you perceive them.

The fact that most people have been largely unaffected by recession currently is, imo, down to the govt's artificial propping up of the economy. That will change.

Of course, there will always be winners and losers but I think the winners will be fewer and fewer as we go ahead.

It would be interesting to know how many have really benefited from lower interest rates and, of those who have, how many have used the money to put themselves in a stronger position for the future.

chucky

JonnyBravo wrote: »

and price, and ability to pay....

in line with the credit availability

chucky

treliac wrote: »

The fact that most people have been largely unaffected by recession currently is, imo, down to the govt's artificial propping up of the economy. That will change.

i didn't even notice the 1990s recession to even mention affected by it - luckily i haven't been and none of my family have been affected by this recession so i'm not sure about that.