What Quarter of a Million gets you in London

Graham_Devon

wotsthat wrote: »

London has the lowest take up of the scheme and the highest HPI. Cranbrook in Devon is the HTB hot spot and HPI will be about 5%? Why is there such a regional variation in sentiment and why is there an inverse relationship between this sentiment and scheme take up?

I'm afraid the answer is simple. There isn't a vast regional variation in sentiment due to HTB - you've grossly over-estimated the effect of HTB. You've also taken the coincidence of HTB being announced around the same time as HPI increases as evidence..

Cranbrook is a new development - still being built. It's basically a new town. All of the HTB support going on there will be HTB1. Therefore, it's unlikely to have a massive effect on HPI there as it's all new supply to the system.

You cannot compare a new town, where new supply is on tap (as it were) with the city of London.

I am actually surprised to see you making such a comparison. You know it's a new town. That's not in any way an insult on your intelligence, rather it's me suggesting I didn't think you'd try this hard and insult your own intelligence by comparing the two places.

wotsthat

BillJones wrote: »

"Convincing" myself?

I can buy a 2,000 square foot flat on the water here in central London for only two years' salary. Is that not good value?

Edited to add, but "of course" buyers like me don't count. After all there are only a few hundred thousand of us competing for these properties...

A pokey £250k studio flat doesn't become good value because I earn £125k/ year and can buy it for 2 years wages. A £4m flat doesn't become good value because you earn £2m.

You might be suffering from selection bias - just how many people do you think can afford to buy a 2,000 sq ft flat in Docklands for 2 years salary? There will be about 20,000 people in the whole of the UK earning over £1m.

At some point employers will start to reconsider their location. If they're having to pay elevated wages just to house their employees there's an opportunity to save some money.

I expect a moderation in prices but nothing surprises me about the London housing market.

wotsthat

Graham_Devon wrote: »

Cranbrook is a new development - still being built. It's basically a new town. All of the HTB support going on there will be HTB1. Therefore, it's unlikely to have a massive effect on HPI there as it's all new supply to the system.

You cannot compare a new town, where new supply is on tap (as it were) with the city of London.

I am actually surprised to see you making such a comparison. You know it's a new town. That's not in any way an insult on your intelligence, rather it's me suggesting I didn't think you'd try this hard and insult your own intelligence by comparing the two places.

It's almost laughable - you've tried to explain that it's all about HTB by pointing out that HTB sentiment is lower when there's increased supply but higher when supply is constrained. Don't you see the obvious explanation staring you in the face?

Cranbrook = increased supply = low HPI.

London = constrained supply = high HPI

Graham_Devon

wotsthat wrote: »

It's almost laughable - you've tried to explain that it's all about HTB by pointing out that HTB sentiment is lower when there's increased supply but higher when supply is constrained. Don't you see the obvious explanation staring you in the face?

Again, you are loading words into my mouth to make your argument as it seems you are utterly incapable of having a debate based on what's actually said. Sadly Jason recently left the forum due to this very thing.

This is all you seem capable of doing, so I'm afraid I'm going to have to give up with you.

IronWolf

Interesting infographic here



Im surprised London is above Hong Kong!

London is DOUBLE Tokyo and New York in terms of price/rent

It clearly isnt a supply demand issue, because rents are also affected by supply and demand.

I'm still at a bit of a loss as to who is buying these flats to be honest, all evidence suggests they can afford it, yet renting is clearly far cheaper. I think the fact we are only behind Monaco says a lot - rich people parking their money in 'safe havens' is what's really behind this.

Generali

IronWolf wrote: »

Interesting infographic here
rich people parking their money in 'safe havens' is what's really behind this.

That and criminals.

If you have a large stash of cash then buying a house with it is a pretty good way to launder it, assuming you can find a bent solicitor or at least a half blind one.

BillJones

wotsthat wrote: »

A pokey £250k studio flat doesn't become good value because I earn £125k/ year and can buy it for 2 years wages. A £4m flat doesn't become good value because you earn £2m.

Of course it does. If you can afford a property that you love for an amount that you can easily afford to pay, then it's brilliant value.

That's the only thing that matters to me. Can I have this property easily, ad do I like it?

If yes, then it's a bargain. If no, then it's too expensive, and house prices need to come down!!!

IronWolf

BillJones wrote: »

Of course it does. If you can afford a property that you love for an amount that you can easily afford to pay, then it's brilliant value.

That's the only thing that matters to me. Can I have this property easily, ad do I like it?

If yes, then it's a bargain. If no, then it's too expensive, and house prices need to come down!!!

The value of a property is completely independent of whether you personally can afford it or not.

Maybe I shouldn't be surprised someone in the finance industry struggles to differentiate price from value

wotsthat

Graham_Devon wrote: »

Again, you are loading words into my mouth to make your argument as it seems you are utterly incapable of having a debate based on what's actually said. Sadly Jason recently left the forum due to this very thing.

This is all you seem capable of doing, so I'm afraid I'm going to have to give up with you.

You inadvertently explained why supply is the much more significant factor than sentiment associated with HTB.

Having realised this you've thrown your toys out of the pram. Silly getting so upset about getting something right.

Conrad

Well as someone dealing with London buyers, my average client couple earns £89000.
These are ordinary folk not bankers or professionals in the main.



One couple - she works in a hairdressers, he is a self employed builder, Russians, just bought first place, a 3 bed house in Romford for £250k. She works central London. His real income is going to be higher than that he pays tax on (for example use of room in home as an office is not a real cost).