Housing Affordability has peaked, now decreasing

[Deleted User]

Is there a reason why you said that only lower paid work should be moved out of London?

It seems to me that you'll always have a problem if you have too many people wanting to work in one place. It's just not possible to house them all and that leads to silly house prices. Wouldn't it make more sense to try and distribute wealth, work (and therefore housing demand) throughout the country? Is it really so hard to do in this day and age?

System

nearlynew wrote: »

One day you might find something relevant to post

:rotfl:I was close, for a pyschopath you can be quite entertaining.

Thrugelmir

Deleted_User wrote: »

London is one small part of the UK. In most parts of the country housing is far more affordable, but it's heading the same way as london. What I'm suggesting is that we'll start to see the same pattern in the rest of the country as we've seen in London already. People moving further and further afield to get cheap housing and as a result prices are pushed up in those areas too. And of course, this will go some way to keep prices down a little in the city - that bit less competition.

But what about London. As you say, prices are silly. There isn't enough property to go around. There's nowhere left to move out to and still be in commuter distance. Land prices are so high that it's not possible to build property that's cheap enough.

Something has to give. And as I said, the only solution I see is for a big push to move jobs away from London so that people can work in the areas where they can buy cheaper property.

How else would you solve the problem? Dropping house prices in the city won't help because the real problem is that there aren't enough houses to go around.

I was born in Surrey. There was no way I could get onto the property ladder even 35 years ago. Moving to somewhere you can afford has always been the case. If anything the motorway and A road network makes it easier to commute long distances. So country property fetches a premium too.

Areas which are "cheap" are that for a reason. Not that they are bad in any way, just not so desirable. When people buy houses the heart rules more than financial sense.

Emy1501

Deleted_User wrote: »

Sorry, missed your comment last time around.

Nowadays it's the retired people that have the money (they've made a fortune on property in expensive areas) so if they move out to the sticks wouldn't that in itself push prices UP out there and DOWN in the cities? Or at least, it would stop prices from rising so rapidly in the city as some of the big-bidders will be out of the picture. You must also remember that we're reaching a point where a very large percentage of the population is retired.

I think the need to live near work is what's limited the degree to which non-retired people could move out of expensive areas in the past. But nowadays it's becoming more and more common for people to work from home.

But I'm not necesarily talking about everyone moving out to the back of beyond. For example, where I've moved to is only 30 minutes down the motorway from the city centre. In London where house prices have been rediculously high for a long time people are already thinking nothing of comutes of an hour or more. In Glasgow prices aren't so high that people have been forced out that far....yet. But if they do go higher then based upon the example of London surely that's what will happen here? And in other cities?

But of course that's less than ideal. The government won't want everyone commuting when there's a big push to keep fuel emmissions down. So..

1. People need a place to live near where they work.
2. Even well paid people can't afford property in the cities (and other popular areas)
3. Property is expensive because demand outstrips supply
4. In order to satisfy demand you need to build more houses
5. To build houses you need land
6. Demand for building land in the cities outstrips supply thus pushing prices up
7. Because of the price of land it's very difficult to build affordable housing in the cities.

There is only one solution that I see - move the jobs out to where the cheaper houses and cheaper land is. A lot of nice little country places are surrounded by greenbelt land. That can of course be built on if the rules are changed. But I would have thought that old, run down industrial areas might well benefit first.

In the area where I live there is a big push to do just that. Despite the recession, millions is being spent on regeneration. Mostly funded by government and EU. They're building nice housing, leisure facilities and buisiness parks.

I don't really see any other solution to the problem.

The problem is that for the people at the top to release their money there needs to be a bottom. Once property gets out of the reach for the many the bottom will dry up.

IMO the only thing going for the UK is that Mr average can do pretty well for himself unlike many other countries where only the highly educated do ok. Once we get to a stage where only the highly educated and elite can do OK then the country has nothing to offer. I'm doing all I can to make sure my eldest is well educated and therefore able to move to another country if this one becomes unaffordable. Whats the point of stuggling here when you can struggle in a much nicer country who are happy to have your skills.

In due course no one will want to come here and many skilled people will leave if it got to the point where you could only have a reasonable standard or living if you were highly educated.

[Deleted User]

Thrugelmir wrote: »

I was born in Surrey. There was no way I could get onto the property ladder even 35 years ago. Moving to somewhere you can afford has always been the case. If anything the motorway and A road network makes it easier to commute long distances. So country property fetches a premium too.

Areas which are "cheap" are that for a reason. Not that they are bad in any way, just not so desirable. When people buy houses the heart rules more than financial sense.

Exactly. Now around London I think all the areas that are suitable for commuting have already been saturated. There is nowhere else for people to go. Building more houses isn't an option as there isn't any room left to build them. So people will be forced to move further afield - and for most that will probably mean finding work elsewhere too. It might seem a step too far, but it's what Northerners had to do a couple of decades ago when living in their home towns was no longer viable.

But around many of the other cities in the UK there are still lots of very nice little places that are within commuting distance and still affordable. So for those outwith london there are still plenty of opportunities to live somewhere nice and, if you're lucky, make a killing by moving into an up-and-coming area.

The problem is that for the people at the top to release their money there needs to be a bottom. Once property gets out of the reach for the many the bottom will dry up.

Which means the very highest priced properties in the most populated areas may well drop in price. Retired people will frequently have bought property very cheaply and will own it outright. It's nothing for them to knock money of the price if they intend to move somewhere much cheaper. And if there's competition for property in these cheaper places then wealthy pensioners will quickly push up prices as they can afford to pay over the odds for what they want.

This is one of the reasons why I think there will be a lot redistribution of wealth in coming years. If some places are over priced and over saturated then the natural thing is for wealth, jobs and people to flow to the places that are still quiet and affordable. It doesn't matter how much people want to live in desireable places. If there are 2 households for every available home 1 of them HAS to go elsewhere.

Chrysalis

Emy1501 wrote: »

The problem is that for the people at the top to release their money there needs to be a bottom. Once property gets out of the reach for the many the bottom will dry up.

IMO the only thing going for the UK is that Mr average can do pretty well for himself unlike many other countries where only the highly educated do ok. Once we get to a stage where only the highly educated and elite can do OK then the country has nothing to offer. I'm doing all I can to make sure my eldest is well educated and therefore able to move to another country if this one becomes unaffordable. Whats the point of stuggling here when you can struggle in a much nicer country who are happy to have your skills.

In due course no one will want to come here and many skilled people will leave if it got to the point where you could only have a reasonable standard or living if you were highly educated.

I dont know about other countries in that sense but I do agree with you on the unskilled, now days your job prospects are working at a takeaway or a shop both typically dead end jobs. Even for people who get degrees, they will struggle to find decent work as there is too many with degrees now devaluing the achievement. What I would like to see make a comeback is apprenticeships, someone can leave school at 16-18 and get an apprenticeship in a good trade.

HammerSmashedFace

HAMISH_MCTAVISH wrote: »

http://www.telegraph.co.uk/finance/economics/6890962/Buyers-priced-out-of-the-UK-housing-market.html

Interesting.

Housing still much more affordable than at peak, and indeed still much more affordable than the long term average.

Only if you assume money printing and low interest rates are permanent. Of course they are not though, and what is worse for people who've been hoodwinked into thinking that they are, is when inflation in essentials start (this month), wages will not see any kind of following rise, this coupled with the inevitable rise in rates will squeeze incomes to breaking point.

Only continued money printing stop this, we all know that can't continue either.

Davesnave

Chrysalis wrote: »

What I would like to see make a comeback is apprenticeships, someone can leave school at 16-18 and get an apprenticeship in a good trade.

Seems they are there if kids want to do one:

http://www.apprenticeships.org.uk/~/link.aspx?_id=4D238BB3C864454584500406B89181B5&_z=z