Why exactly are houses so expensive?

Rinoa

An internet blogger says 'this is the way it is'.

Graham believes everything internet blogger says.

Graham_Devon

ukcarper wrote: »

how do you work that out

Financial Times states the average salary in 1950 was £499 in todays money.

£499 x 77.6 = £38,772

moneyinmypocket

When I was a renter I wished for prices to come down, what I learnt though was just because I didn't want to pay x price didn't mean the next person wouldn't. There is a lot of cash out there and people making good money.

I just can't see a big crash coming, the real crime has been wage stagnation - if wages had been going up 3-4% last 5 years while house prices reduced the same we could have met in the middle by 2017 or so - but with wages remaining flat and house prices going up a bit down a bit we haven't really got anywhere

ukcarper

Graham_Devon wrote: »

Financial Times states the average salary in 1950 was £499 in todays money.

£499 x 77.6 = £38,772

That is far higher than everything I have found

Graham_Devon

ukcarper wrote: »

That is far higher than everything I have found

True.

Lowest I've found says £100 a year.

So I guess it'a a free for all on the statistics front.

ukcarper

As I said £368 in 1950

Measuring worth puts average earnings at

1950 £302

1952 £375

2010 £23,500

That looks reasonable to me so £26,010 / £375 = 70x

Looking at Nationwide earnings to house price graph house prices were 4x average earnings in 1953 it was the same in 2002/3.

the_flying_pig

Between 1995 and 2007 the UK population increased by 5%, the housing stock increased by 10% and house prices increased by 350%, meanwhile mortgage lending by banks increased by 630%. Which of these figures is more likely to have led to a 350% rise in house prices: a 5% rise in population growth which is matched by an increase in supply of housing; or an unprecedented increase in mortgage lending from the banks?

i think everyone agrees with this logic deep down. even HAMISH.

DpchMd

I noticed the other day that you can now get a double cheeseburger for £1.49.

I remember just a few years ago buying 5 double cheeseburgers from Liverpool street station after a night out for less than a fiver. That's a massive 50% rise.

Why are house prices so cheap when compared to double cheeseburgers?

mustang121

It dosen't help that many people do not have the patience to save.

Many people want the latest gadets and cars and obtains these things on finance. I cannot believe some people actually get finance for sofa's, laptops etc. What the fudge is all that about?! Save aand buy what you can afford out right!

My advice to young people out there. Never accept credit cards, finance plans, overdrafts or what ever other BullSh@It there is out there. Life will be so much simpler for you.

The only debt a person should ever have is a mortage and even then it should be as little possible and short as possible.

(I'm not including student loan too much as its true debt as the rules differ, but I still reckon student should be scrapped. Instead relying on grants and sponsership for the intelligent, determined future doctors, engineers, physicist etc)

chewmylegoff

DpchMd wrote: »

I noticed the other day that you can now get a double cheeseburger for £1.49.

I remember just a few years ago buying 5 double cheeseburgers from Liverpool street station after a night out for less than a fiver. That's a massive 50% rise.

Why are house prices so cheap when compared to double cheeseburgers?

personally i always preferred three quarter pounders with cheese to finish the night off.