What would happen if house’s dropped to the magic 3.5 times average income?

Really2

Graham_Devon wrote: »

Since when?

If it had of been, we would never have all the problems we have now.

You were still using the salary vs price figures either way, as to say mortgage lending has not gone over 3.5x income on average very often is laughable. The whole boom was based on ever increasing multiples.

Spoiling for a scrap again.

it is based on an average, not every loan in the boom was 100%+.

Take up your frustration with,

Joseph_Bloggs wrote: »

Wasn't it mortgage loans at 3.5 times salary rather than prices?

he made the point I agreed with.

PS who said it had not gone over 3.5X income. Context GD, Context.

Graham_Devon

Really2 wrote: »

Spoiling for a scrap again.

it is based on an average, not every loan in the boom was 100%+.

Take up your frustration with,


he made the point I agreed with.

Exactly what I said. Based on an average of those taking out a mortgage. You said I was wrong.

Am I supposed to just accept you telling me I'm wrong when I;'m not, and then accept that when I put you right, I'm "spoiling for scrap"?

I'm not having a go at you am I, just pointing out that it was only based on those who could afford, which is wildly different to an average price vs salary.

PS who said it had not gone over 3.5X income. Context GD, Context

Yes, context Really.

Having to selectively pick and choose what you take from my posts again??? I'm starting to feel sorry for you. I'm way to on the ball to leave myself open to anything....I've learnt!!

I said:

Graham_Devon wrote: »

as to say mortgage lending has not gone over 3.5x income on average very often is laughable.

You said exactly that:

Really2 wrote: »

It is, and I do not think they have been above that, that often on average.
(some post them on here I think we are something like 3.4X now)

Really2

Graham_Devon wrote: »

Exactly what I said. Based on an average of those taking out a mortgage. You said I was wrong.

Am I supposed to just accept you telling me I'm wrong when I;'m not, and then accept that when I put you right, I'm "spoiling for scrap"?

I'm not having a go at you am I, just pointing out that it was only based on those who could afford, which is wildly different to an average price vs salary.

I have not said you are wrong once so stop taking what I have posted out of context.

The point by the OP was that house prices have never been supported by 3.5X average salary.
They have been supported by 3.5X income.

Unless you are saying everyone in the UK should be able to buy I am not really sure what you are trying to argue about.
It will never has and never will be based on 3.5X the average wage.

As for your edit you missed out again, who's selective?

Really2 wrote: »

It is, and I do not think they have been above that, that often on average.

What is wrong with you?

Other than a brief period of madness in 2005-2007 it is pretty much true, and I acknowladged that with what I wrote

Really2 wrote: »

that often on average.

pinkteapot

In which year was the average house price last equal to 3.5x the average salary plus say a 10% deposit?

And are we talking single or joint salary?

phil_b_2

I dont even know how the 3.5X rule thing came about. It's pretty abstract.

Someone earning £50,000 per year could realistically be worse off than someone earning £20,000 a year, depending on their financial/family/life situation.

Really2

I think it would be more telling if some one could tell us why they are not sustainable at over 3.5X a salary?

wherediditallgothen

Strikes me that they will always rise and fall over time. When they are out of bounds for the average person, (such as now), they will inevitably drop. Not long after that happens, people will buy, and the prices will rise again.

Repeat to fade.

HAMISH_MCTAVISH

3.5 times salary is an absolute nonsense number that was set as a "norm" over the 3 decades of the highest interest rates in history.

With rates in modern times averaging closer to 5% than the 10% to 15% they used to, then the 3.5 times income could just as easily be 5 to 7 times income nowadays with no adverse impacts.

wherediditallgothen

HAMISH_MCTAVISH wrote: »

3.5 times salary is an absolute nonsense number that was set as a "norm" over the 3 decades of the highest interest rates in history.

With rates in modern times averaging closer to 5% than the 10% to 15% they used to, then the 3.5 times income could just as easily be 5 to 7 times income nowadays with no adverse impacts.

And as if by magic, rates go to 15% again, for whatever reason, and all those who went to 5x income or more are Donald Ducked.

140 grand is a lot to lend someone who earns 20 grand. 3.5X sounds vaguely sensible, and might give people a chance at being mortgage free at some point in their lifetime.

Radiantsoul

Generali wrote: »

It's rubbish just like when at the end of the news they say the Dow was down by 5 points because of a rise in the oil price.

I used to have to write commentary for a weekly energy trading company and often had to write that sort of narrative nonsense.