£1.2tn given to old from young

abaxas

zygurat789 wrote: »

This thread is symptomatic of the real problem with this country. The post boomers have always had it good thanks to their parents and now they are trying to buy a house they think it should all be just as easy for them.
Perhaps they should try working hard for their money instead of forever runnunig to the bank of Mum & Dad.
To buy a house they have to give up other things on which they spend their money like binge drinking, wasting petrol by driving too fast and not buying disposable items.
There is very little difference between the ratio of house prices to salaries now and when I first bought. Just because your parents lived in a 3 bed detatched doesn't mean that the next generation should start in the same.
We all had to start in starter homes.
Stop moaning, do something positive - like save and you will know what we had to go through to give you ungrateful kids what you have taken from us

Just done a quick fag packet calc.

Option 1 : 100000 mortgage 6% mortgage rates 20k wages 3% wage inflation.
Option 2 : 100000 mortgage 12% mortgage rates 20k wages 10% wage inflation.

Over the lifetime of the mortgage, option 1 pays 3x the relative amount of salary than option 2.

Average %age of salary over full term for option 1 - 27%
Average %age of salary over full term for option 2 - 16%

Which house is cheaper?

Really2

abaxas wrote: »

Just done a quick fag packet calc.

Option 1 : 100000 mortgage 6% mortgage rates 20k wages 3% wage inflation.
Option 2 : 100000 mortgage 12% mortgage rates 20k wages 10% wage inflation.

Over the lifetime of the mortgage, option 1 pays 3x the relative amount of salary than option 2.

Average %age of salary over full term for option 1 - 27%
Average %age of salary over full term for option 2 - 16%

Which house is cheaper?

Neither you missed out inflation.

abaxas

Really2 wrote: »

Neither you missed out inflation.

That is a pure cost calculation. Nothing to do with HPI.

Wage inflation is included.

ukcarper

abaxas wrote: »

Just done a quick fag packet calc.

Option 1 : 100000 mortgage 6% mortgage rates 20k wages 3% wage inflation.
Option 2 : 100000 mortgage 12% mortgage rates 20k wages 10% wage inflation.

Over the lifetime of the mortgage, option 1 pays 3x the relative amount of salary than option 2.

Average %age of salary over full term for option 1 - 27%
Average %age of salary over full term for option 2 - 16%

Which house is cheaper?

DO you know what average rent to income is

chucky

mbga9pgf wrote: »

Tell that to the hundreds of thousands that are in serious financial trouble now

how about the millions and millions that have benefited from owning their own home, not just the ones now but in the past. they can't be to blame for people taking on debt that they couldn't afford or didn't plan for properly.

should they have been stopped from owning their own homes?

Really2

abaxas wrote: »

That is a pure cost calculation. Nothing to do with HPI.

Wage inflation is included.

But if wage inflation was 10% but inflation was 20% your money is worth less and your house.


Simple mater of fact is when wage inflation was high general inflation was higher.

There is no fag packet maths on such a subject, much like house price falls in the 70's there was no nominal fall it was all down to inflation.

A pure calculation would not include wage inflation just the IR and the house price.

zygurat789

Quote:
Originally Posted by mbga9pgf
Because SENSIBLE lending limits of max 3 times salary meant you couldnt!

I got more than 3x my salary in 1972

The norm ROSE to 3 X husband's salary & 1 times wife's salary by 1973 when the crash happened.

mbga9pgf

Harry_Powell wrote: »

How would we have reset the economy without the banks? How could any business exist without lines of credit? What sort of industry do you think the UK should move towards to replace the financial sector?

So, lets get this right, without an ever expanding supply of credit, we cant survive as a nation? Is that what you are saying? because if it is, your plan will ultimately fail. At what stage do we say, we are paying too much interest, we need to stop? At the stage our net outgoings are absorbed completely by credit?

Of course we couldnt survive without the banking system. I think splitting the banks off into a glass-stegall style model then failing the assets of those banks involved in dodgy dealings would have been enough. Not all banking needs to go, only the stuff based on unsustainable investment. That includes ever growing mortgage lending. At some stage, we will simply destroy demand alltogether with the net payments we make to the banking system, much of the profit now going abroad to foreign banks.

As to what industry, the Managerial service sector, at a top level is something we are exceptionally strong at. Global advanced civil and mechanical engineering projects, such as oil refinement, nuclear and big plant setup again is something we are exceptionally good out. Pharmaceuticals, the growing trade in renewable energy sources (biofuels, biomass, wind, solar, tidal) are all subject to underinvestment, yet could yeild big rewards. Software - particularly in defence, is an exceptionally strong indusry, be it digital signal processing, encryption or anologue to digital systems, we have some of the globes best mind.

Planning to live off ever increasing house prices as a source of national growth will completely F*ck us; we missed a fantastic opportunity in my mind during the credit crunch. Instead we chose to bury our heads, pretend it didnt happen and do EXACTLY the same thing again. The same pack of cards rebuilt will still fall down in the long term.

mbga9pgf

zygurat789 wrote: »

This thread is symptomatic of the real problem with this country. The post boomers have always had it good thanks to their parents and now they are trying to buy a house they think it should all be just as easy for them.
Perhaps they should try working hard for their money instead of forever runnunig to the bank of Mum & Dad.
To buy a house they have to give up other things on which they spend their money like binge drinking, wasting petrol by driving too fast and not buying disposable items.
There is very little difference between the ratio of house prices to salaries now and when I first bought. Just because your parents lived in a 3 bed detatched doesn't mean that the next generation should start in the same.
We all had to start in starter homes.
Stop moaning, do something positive - like save and you will know what we had to go through to give you ungrateful kids what you have taken from us

Crap, they BOUGHT a 3 bed semi as a starter home. How many FTBs are there who get do do that these days? That was the NORM in their day!
So, I suppose the 100K I have accumulated over 4 years just fell into my bank account then?

mbga9pgf

ukcarper wrote: »

I got more than 3x my salary in 1972

And funny old thing, there was a real adjusted price crash of around 45%. I wonder why? Couldnt have been that housing was unaffordable due to excess lending surely? :rolleyes: