Who'd vote for lower house prices? Not many...

HAMISH_MCTAVISH

Graham_Devon wrote: »

. Footballers wages didnt go from thousands to millions within a few years just through inflation....but they WILL drag the mean up...

just like the mansions they have built for themselves will drag the mean house price up.

But it's of no relevance to ordinary people.

Graham_Devon

HAMISH_MCTAVISH wrote: »

just like the mansions they have built for themselves will drag the mean house price up.

But it's of no relevance to ordinary people.

3rd time lucky....destroy my figures....

Either that, or give up with these weird references which have absolutel no relevance to the discussion. At least everyone else is keeping on track.

System

I really don't understand your lots infatuation with 4x salary. It's wrong, times change.

ukcarper

Graham_Devon wrote: »

LOL, I can't be right "to some extent". The figures are above, and apart from a calculation gone wrong, though I don't think it has, it's clear as night follows day that the median wage has fallen away from the mean wage, meaning the graph is generously ignoring a £40,000 difference in salary vs house price.

It's just a rigid graph compaing 2 datasets as I said.

The data within the time period, however, has changed, and changed significantly, which the graph ignores.

I'll do it again I will use male full time as I can't be bothered to get full time for all

now some one on mean will be £34k short if they get both get a 4.2x mortgage.

in 1997 they would have been £12.8k short

the difference between mean and median is £8,110 and £3,043 so now shortfall is 4.2x difference between mean and median and in 1997 it was 4.2x

Thrugelmir

Joeskeppi wrote: »

I really don't understand your lots infatuation with 4x salary. It's wrong, times change.

Historically lenders maintain there overall lending books in the 3 to 3.5 times earnings range. (Earnings is based on actual applications).

This is a more important stat than house prices to earnings ratio.

ukcarper

Graham_Devon wrote: »

Gotta say, nice one for providing the data! And I can now shwo what I meant with the supplied data.

The difference between now and 1997 is quite stark.

In 1997, the mean was £4,470 greater than the median x 4.2 = £18,774 allowance that the graph creates in the trend line.

In 2011.the mean was £9,792 greater than the median x 4.2 = £41,126 allowance that the graph creates in the trend line.

To look into that a little further, the "allowance" (can't think of the right word there) was 10% greater than the median wage in 1997.

In 2011, the allowance was 64% greater than the median wage.

Therefore, that's how using the same rigid data over 30 years (30 years where it seems the mean keeps growing away from the median wage) leaves us with a measure that doesn't correlate with reality.

I don't think anyone can really disagree that the allowance the growing disparity between mean and median averages has created, isn't distorting reality.

Move it onto house prices at the time of the wages, and the disparity just grows even further. However, as were so keen to stick to an average trend line, that's what I have done.

your figures are wrong diff is not £4470

Graham_Devon

ukcarper wrote: »

your figures are wrong diff is not £4470

Indeed you are correct.

Feel free to change them...won't make much difference

I think it's categorically proved the point about how useless that graph is in the real world anyway.

ukcarper

Graham_Devon wrote: »

Indeed you are correct.

Feel free to change them...won't make much difference

I think it's categorically proved the point about how useless that graph is in the real world anyway.

I have 54% more now 44% more in 1997

Graham_Devon

ukcarper wrote: »

I have 54% more now 44% more in 1997

So you agree, although the graph says it's nearly as affordable as the "norm"...it's actually not?

ukcarper

Graham_Devon wrote: »

So you agree, although the graph says it's nearly as affordable as the "norm"...it's actually not?

I think I've already posted that if you take into account difference between mean and median the earnings to house price ratio is 4.77x