People will adjust their spending habits in order to afford their mortgage

Carl31

Voyager2002 wrote: »

Most people have far too much money, and waste it on junk that just makes them miserable. I mean, no-one really needs a television, motor car telephone, convenience food and lashings of alcohol. Back in the 1940s people mainly grew their own vegetables; got their entertainment talking with each other and if they were lucky reading books from the local public library; walked or cycled to get there they needed to be; and cooked everything from raw ingredients rather than buying it processed. And you know what? Everyone was a lot happier back then.

Life expectancy was lower then too

With regards to the OP, people will adapt as they have to, they might not like it but no one made them take a mortgage

The main problem with paying higher housing costs is of course less cash in your pocket to spend on 'stuff', unfortunately, people buying 'stuff' keeps people in jobs and the economy flowing, by ploughing more into assets which are not easily transferrable, its restricts movement in the economy

Its all very well holding assets of value, but if you cant transfer that value, they're no good in the short term, when you need it

N1AK

Voyager2002 wrote: »

Everyone was a lot happier back then.

Rose tinted glasses much? I'm happy right now thank you. If there was a high level of happiness back then it wasn't because they didn't have all the mod-cons. If it was down to a sense of purpose or something like that then chances are they'd have been even happier if they didn't have to micro-manage their food via a ration book.

antrobus

Deangelo wrote: »

... There will be a lot more of the population renting than owning soon......

No there won't.

The owner-occupied to renting split was 69:31 in 2001, and 64:36 in 2011. Even if that rate of change continued, it's going to be 20 or 30 years before a "lot more" of the population is renting. That ain't "soon".

Out,_Vile_Jelly

An impending financial catastrophe will cause people to reavaluate what is "essential" and what is a "luxury".

I can't believe it took til page 4 of this thread for people to mention the Old Style board. Plenty of people there feed their families (extremely nutritiously) on low budgets and approach their spending with guile and cunning.

I went to my nan's 90th party recently- her generation would clutch their sides with sherry-soaked mirth at the idea that a family on Graham's example budget couldn't trim costs.

CLAPTON

antrobus wrote: »

No there won't.

The owner-occupied to renting split was 69:31 in 2001, and 64:36 in 2011. Even if that rate of change continued, it's going to be 20 or 30 years before a "lot more" of the population is renting. That ain't "soon".

always interesting to note that the actual number 'owning' has not fallen;
it seems that the increase in population is 'choosing' to rent.

Maybe the fact that half the increase in population (of 2 million) over the last 10 year has choosen to live in London may account for some of it.

Mr._Pricklepants

GhIFA wrote: »

Many people on low rates will have taken the opportunity to overpay during the past few years so as to reduce the amount they need at the point of re-mortgage.

Yup.
Most people I know who have mortgages have made an absolute killing the last couple of years thanks to these low rates, dramatically reducing their LTV through overpayments and HPI. They're not too bothered with future rate rises. Many have fixed recently.
I know, it's anecdotal and it's probably completely different in Graham land.

Jack_Johnson_the_acorn

I find it incredulous that people who are capable of buying a house would be incapable of budgeting for a rate rise..... which IMO makes the whole thread a bit obsolete.

There will of course be some people who have no financial planning ability, but you wouldn't expect these people to get a mortgage and those that do must represent a tiny minority of home owners.

nicko33

Carl31 wrote: »

Life expectancy was lower then too

The good old days, before modern medicine created the pensions time bomb.

nicko33

Graham_Devon wrote: »

£150 per month on council tax.

Does the average person live in a Band F house?

try £100 per month

"As of 2011, the average annual levy on a property in England was £1,196."
http://en.wikipedia.org/wiki/Council_Tax

nicko33

Graham_Devon wrote: »

The only issue I'd take with your thoughts is that not many will have sky and certainly not at £70 per month in the first place

10.7 million customers
http://corporate.sky.com/about_sky/key_facts_and_figures

revenue is £6.8 billion
so divide that by the number of households, and take that as the average households spend on Sky

26.4 million households
http://www.ons.gov.uk/ons/rel/family-demography/families-and-households/2012/stb-families-households.html

£21 per month per household