Homes for FTB's at most affordable in 10 years

Emy1501

ukcarper wrote: »

The thread is about affordability not if houses are affordable to everyone which they never have been.

In comparison to earnings houses are no more that 20% above long term average so property is less affordable than average. All the report says that you have to go back to before 2002 to find a time when property was more affordable.

I don’t believe property is only affordable to people with rich parents a couple would need to be earning £42k between them to buy the average house with a 10% deposit and 3.5x joint mortgage.

They would take home at least £2600 a month so saving deposit shouldn’t take to long if they are prepared to make some sacrifices.

There were probably 100k mortgages a month approved in 2002. Now there are about 50k.

As for people with rich parentsTthe CML have said previously said that few people without rich parents are able to save up the average deposit they were seeing for FTB's which was close to 25%. That was a good year or so ago though.

The fact that housing costs maybe more affordable to the lucky few who can buy a house does not take away from the fact that for the average person housing is not affordable.

IveSeenTheLight

Graham_Devon wrote: »

We back to another Bentleys are affordable for Bentley owners stance?

Jeez I wish people would move on from groundhog day scenario.

I clarified elsewhere that there are two type of affordability.

I'll dig out the post later and hopefully we can stop from having to repeat the same thing time and again.

It feels like an Ariston advert

All together noe

Ariston and on and on and on and on and on and on and on and on and on and on and on and on and on and on :yawn:

IveSeenTheLight

Graham_Devon wrote: »

We back to another Bentleys are affordable for Bentley owners stance?

jeez it was just a few posts ago I thought we clarified this

I've seen there are two takes on affordability

1. Property Affordability
2. Mortgage affordability

1) Now I would agree that the indicators are that property is becoming less affordable. Simply looking at the how ownership percentages show that this is decreasing, largely due to deposit requirements and credit availability.


2) With regards to mortgage affordability, it's undeniable that using the same statistic of measurement, property is at one of the lowest points in the last 30+ years. Potentially, there will never be a better time to have a mortgage. There are very good historical long term fixes for those cautious of rate rises. Lets not even consider that the demographic of mortgage payers has moved more towards dual income households whilst the measure still utilises one wage ( average earnings for Male Full Time employees).

Can we agree on the following: -

Property is becoming less affordable to the masses, but for those that can get the deposit and credit it's one of the most affordable times

IveSeenTheLight

Wookster wrote: »

I agree with every in your post except this. This statement is predicated on the fact that interest rates remain low. Because properties are less affordable (in the South East & London) all that needs to happen is for interest rates to rise and then mortgages will become unaffordable, and as it so happens, despite base rates being at record lows, mortgage rates are creeping up.

I believe we have covered this by referring to historically low long term fixes available.
If you've fixed then you don;t have to worry about base rises.

I recall 10 year fixes were circa 7%, you can get for under 5% now.

IveSeenTheLight

Emy1501 wrote: »

http://www.mortgagesolutions.co.uk/mortgage-solutions/news/2191114/reduction-in-bank-lending-hurts-firsttime-buyers-esurv

The number of loans to people with a deposit of less than 15% hit its lowest level for 11 months, these borrowers now make up just 10% of total house purchase loans.

Cant find the figures for pre 2008 but from memory it was about 15%

Quite possibly because HPI eroded those needing hight LTV products when they remortgaged.

My first mortgage was 100% (used the deposit to pay fees & modernise the flat.)
Three years later I recall getting a 80% LTV product.

IveSeenTheLight

paulmapp8306 wrote: »

Really? the AVERAGE wage might be inflating, but the MAJORITY of wages have seen cuts, or freezes for the last 3 years.

Once again, those paid well are offsetting those paid not so well and distorting the true figures.

Interesting, do you have a link for this?

It would be very easy to compare local areas with previous years.
I'm a bit busy so maybe you could look into it, else I could post something later.

Unless you think that those getting payrises are getting huge rises that are being skewed by the majority

ukcarper

Graham_Devon wrote: »

We back to another Bentleys are affordable for Bentley owners stance?

If you want to take it to the extreme, all the report says is property is affordable to more people now that in has been for the last 10 years. I don't see why you lot can't understand that, it's not saying that it is affordable to every Tom !!!!!! and Harry.

Emy1501

ukcarper wrote: »

property is affordable to more people now that in has been for the last 10 years. I don't see why you lot can't understand that, it's not saying that it is affordable to every Tom !!!!!! and Harry.

Because the above is simply not true as less people can afford to buy a house now than could in 2002 and approvals confirm that. Also Home ownership rates are falling and if housing was more affordable they would be rising.

ukcarper

Emy1501 wrote: »

There were probably 100k mortgages a month approved in 2002. Now there are about 50k.

As for people with rich parentsTthe CML have said previously said that few people without rich parents are able to save up the average deposit they were seeing for FTB's which was close to 25%. That was a good year or so ago though.

The fact that housing costs maybe more affordable to the lucky few who can buy a house does not take away from the fact that for the average person housing is not affordable.

I had a look where I live a reasonable 2 bed house costs about £175k so with a 3.5x mortgage and 10% deposit a couple would need to earn £45k between them.

The median male full time wage where I live is £30k and £25.5k for a female. 30% percentile figures are £24k and £18K.

If one earns £25k and the other earns £20k they would take home £2971 a month. A 1 bed flat is £600 a month leaving £2371. The deposit would be £17.5k I would have thought it would be possible to save that in a couple of years.

Graham_Devon

ukcarper wrote: »

I had a look where I live a reasonable 2 bed house costs about £175k so with a 3.5x mortgage and 10% deposit a couple would need to earn £45k between them.

The median male full time wage where I live is £30k and £25.5k for a female. 30% percentile figures are £24k and £18K.

If one earns £25k and the other earns £20k they would take home £2971 a month. A 1 bed flat is £600 a month leaving £2371. The deposit would be £17.5k I would have thought it would be possible to save that in a couple of years.

Kids?

Oh hang on, I'm not allowed to mention real life

Trying to suggest homes are affordable is a complete and utter nonsense.