Wage vrs House Prices

kriss_boy

Stats seem to suggest house prices exploded in the last 10 years.

But is there any logical reason as to why the trend of the prior 30 years wont be restored?

Personally I think culturally things changed in recent years when mod cons and home technology became a focus for a lot of peoples disposable income. Couple to that the birth of numerous home/property programmes. An greater emphasis was placed on furnishing a property in a particular way and staying in became the new going out.

But do you think today any logical reason remains as to why homes should be so expensive?

Personally I dont think the younger generations are prepared to devote such a high proportion of their salaries on a property.

treliac

kriss_boy wrote: »

Personally I dont think the younger generations are prepared to devote such a high proportion of their salaries on a property.

It's less to do with not being 'prepared' and more to do with not being 'able'.

nollag2006

kriss_boy wrote: »

Personally I dont think the younger generations are prepared to devote such a high proportion of their salaries on a property.

Really?

And yet the truth is that mortgage holders are now spending the lowest ever proportion of their income on repayments:
http://www.cml.org.uk/cml/media/press/2664

Why let the facts get in the way of a good rant, eh??

:rotfl:

lisyloo

But is there any logical reason as to why the trend of the prior 30 years wont be restored?

Well look at the reasons and then see whether you think the trend will be reversed.

1) Fewer, smaller, households, ageing population - I wouldn't expect this to be reversed.
2) Larger disposable incomes - I think we could go backwards with globalisation, rising fuel costs etc. but how far??
3) More people investing in property - unlikely to be reversed.
4) More women buying - unlike to be reversed.
5) increasing population - will continue to expand.

Would be happy to see other reasons, but on the whole, no I can't see a reversal.

Malcolm.

nollag2006 wrote: »

Really?

And yet the truth is that mortgage holders are now spending the lowest ever proportion of their income on repayments:
http://www.cml.org.uk/cml/media/press/2664

Why let the facts get in the way of a good rant, eh??

It's a different kettle of fish though. Kriss boy is talking about young generation/FTBers, you're talking about mortgage holders in general. It's not the same thing...

Graham_Devon

nollag2006 wrote: »

Really?

And yet the truth is that mortgage holders are now spending the lowest ever proportion of their income on repayments:
http://www.cml.org.uk/cml/media/press/2664

Why let the facts get in the way of a good rant, eh??

:rotfl:

This is such a tired argument now. Used as often as possible to somehow refute high house prices.

Not only that, but it doesn't really relate to the OP.

Laugh away.

nollag2006

Malcolm. wrote: »

It's a different kettle of fish though. Kriss boy is talking about young generation/FTBers, you're talking about mortgage holders in general. It's not the same thing...

You evidently have not read the article.

The percentage for FTBs is down to 13.2% from 14.9% one year ago.

So affordability for FTBs is also at record highs...

Which I am sure you will agree is a good thing??

ess0two

All about priorities,if you want the latest iphone on contract,newish car,2 nights out per week, thats at least £600 per month,and still living at home.
Somethings gotta give.

kriss_boy

nollag2006 wrote: »

You evidently have not read the article.

The percentage for FTBs is down to 13.2% from 14.9% one year ago.

So affordability for FTBs is also at record highs...

Which I am sure you will agree is a good thing??

How exactly is affordablility at a record high when one of my mates bought a flat in 2004 for 45K and another mate is now buying an identical flat post slump for 85K.

princeofpounds

But do you think today any logical reason remains as to why homes should be so expensive?

The main reason is lower interest rates. That means people can borrow more money to spend on houses for a given salary.

There are also issues of increased demand for individual properties as households fragment into smaller units, less supply as planning got stricter and a number of other physical reasons.

But the main determinant of demand is simply the price and availability of finance, if you run the regressions.

Malcolm.

nollag2006 wrote: »

You evidently have not read the article.

The percentage for FTBs is down to 13.2% from 14.9% one year ago.

So affordability for FTBs is also at record highs...

Which I am sure you will agree is a good thing??

Down to 13.2% from 14.9% one year ago is not the same as affordability....at record highs.