Homes for FTB's at most affordable in 10 years

wotsthat

Graham_Devon wrote: »

So that's just half of the country deemed to be affordable at 4x income. It doesn't state what income is, so it could be dual, it could be sinle, it could be based on silly median full time figures which the majority don't earn.

There's no point worrying about the absolute numbers. As long as the way the calculation is done over consecutive years is consistent then the study clearly shows that housing is as affordable, on this measure, as it has been for 10 years. Great.

Even if they used a 'silly' median it wouldn't matter as long as they used a median throughout.

HAMISH_MCTAVISH

Fella wrote: »

Affordability is a scam term various VIs like to use when describing house prices. They don't want to call them "F***ing expensive" so they call them affordable instead. A classic bit of doublespeak really.

That's the dumbest statement on here in a while.

Fella

HAMISH_MCTAVISH wrote: »

That's the dumbest statement on here in a while.

It's disingenous in the extreme to use "affordability" as a measure of house prices when we have 0.5% IRs & no wage inflation.

At 0.5% base rate many things are affordable. If IRs shoot up they resoundingly won't be. And there's no wage inflation in sight to make repayments more affordable.

You know as well as I do that if IRs shot up the various VIs would instantly drop "affordability" as a measure of house prices, you'd never hear the word again.

It's similar to the good old Halifax & Nationwide predictions on house prices. They published them faithfully for years when the predictions were for circa 10% increases. As soon as their backoffice guys started predicting house prices to stay the same or fall they - um - stopped publishing their predictions.

In a theoretical example, if IRs shot up & house prices fell, every VI in Britain would stop talking about affordability & start talking about how cheap house prices were as a multiple of earnings.

If you disagree with any of the above I'm afraid it's you that's dumb.

wotsthat

Fella wrote: »

In a theoretical example, if IRs shot up & house prices fell, every VI in Britain would stop talking about affordability & start talking about how cheap house prices were as a multiple of earnings.

The OP is talking about how cheap house prices are as a multiple of earnings.

It's not about mortgage affordability.

robmatic

wotsthat wrote: »

The OP is talking about how cheap house prices are as a multiple of earnings.

It's not about mortgage affordability.

And even if it was, as we all know, the 0.5% base rate isn't actually changing affordability for FTBers anyway. Mortgage rates for FTBers with modest deposits aren't much different to those available in the Noughties.

Fella

wotsthat wrote: »

The OP is talking about how cheap house prices are as a multiple of earnings.

It's not about mortgage affordability.

My post wasn't directed at the OP, it's about the use of affordability as a measure of house prices. The point is that when house prices are cheap, they're described as cheap. When they're expensive but ultra-low IRs make it just about possible to buy one & pay the mortage (for now) they're described as "affordable".

Wookster

Great, houses are affordable in the North, where there are no jobs and much fewer people but they are still relatively unaffordable in the South East where there are more jobs and more people.

Doesn't seem like a lot of progress for me.

IveSeenTheLight

Graham_Devon wrote: »

It doesn't state what income is, so it could be dual, it could be sinle, it could be based on silly median full time figures which the majority don't earn.

Let's see........

Districts were deemed "affordable" if the average house price for a first-time buyer there was lower than what someone on typical earnings living there could pay.

Local average earnings were multiplied by four and if the average price paid by a first-time buyer was lower than this sum, it was classed as affordable.

The wording would suggest it's a single buyer

Graham_Devon wrote: »

The top 5 most affordable places were in Scotland.

I recall many people reciting how it was more affordable in Scotland.
Some people cited that prices were likely to lower more than the UK average there, but I think they didn;t quite understand the data.

Graham_Devon wrote: »

For instance, the average deposit used to make the figures work is £27,857.

Where did you get that from?


P.S. do you have a link so we could look at the data ourselves?

IveSeenTheLight

ukcarper wrote: »

Prices are high now but in relation to wages they have been higher in the past and need to drop less than 20% to get to long term average.
Prices have always been high in London I had to move 30 miles out in the 70s.

In relation to wages, society has changed so more double income families are / have bought,

I wouldn't be surprised if we see this increase further in the future. Working children / tenants supplimenting the household income.

Not idea, but not unrealistic.

wotsthat

Fella wrote: »

My post wasn't directed at the OP, it's about the use of affordability as a measure of house prices. The point is that when house prices are cheap, they're described as cheap. When they're expensive but ultra-low IRs make it just about possible to buy one & pay the mortage (for now) they're described as "affordable".

How do we know if houses are cheap or expensive if they aren't measured in a way that puts the price into context.