What Quarter of a Million gets you in London

robmatic

Generali wrote: »

Even then, our high fliers (and they are really doing very well for themselves) can't afford anything at all in the nice areas. Even they're looking at a big chunk of compromise.

These not-nice areas are surely going to rapidly gentrify if the only people that can afford to move into them are high-earners.

Generali

robmatic wrote: »

These not-nice areas are surely going to rapidly gentrify if the only people that can afford to move into them are high-earners.

Maybe. I was around London long enough to see that the ne'er do wells kept places loveable more than desperate people would boost prices.

There's only so many times you can be late for work because someone got killed outside the train station (twice in my case) before you decide to move on.

BillJones

Graham_Devon wrote: »

It does. And that's why NO ONE is suggesting that.

Ignorance doens't give your argument any more weight.

It's not really clear what you are suggesting, unfortunately. You seem to be hinting that you believe that property in London is overpriced, but don't want to actually come out and say that.

BillJones

Graham_Devon wrote: »

It's suggested that this GP has got things wrong, shouldn't have had the kids if he wanted a house

Well yes, if he wanted a house in a nice part of London, then of course he's got it wrong. That's his choice, though.

AndyGuil

If you are looking at kids then there is going to be equity from the current property to consider too. The person will be older and earning more too. So let's say a single earner £60k, plus equity from property owned for 5 years bought for 300k with a 10% deposit. The gain on equity at 10% per year gives £180k plus paid off mortgage, let's say £30k again, so £210k for the next property. £60k salary is going to get you £240k with dependents. That gives you £450k for the next home.

Snakey

Graham_Devon wrote: »

It's not really about single people. Many people with children cannot have both adults working full time, so are reduced to a single income. Often any part time income is spent on childcare, not neccesarily all year round, but certainly in school holidays etc....Theres no magic child minder that appears at school holiday time unless you are lucky enough to have parents close by who are willing to help.

My point wasn't about whether the situation was reasonable or fair. I was thinking about the whole "this can't go on! There'll have to be a revolution!" type of argument and using my own situation to illustrate that the same factors have been present for a while now and the revolution hasn't happened yet, therefore clearly it can go on.

Since I was talking about myself I said "single person" because that's what I was. If you would prefer to mentally replace those words with a description of a family with a single income then feel free, although I don't understand why you'd feel the need to - I can only assume that you don't think my situation was sufficiently deserving (is it only people with dependents who should be able to own their own home)?

Generali

AndyGuil wrote: »

If you are looking at kids then there is going to be equity from the current property to consider too. The person will be older and earning more too. So let's say a single earner £60k, plus equity from property owned for 5 years bought for 300k with a 10% deposit. The gain on equity at 10% per year gives £180k plus paid off mortgage, let's say £30k again, so £210k for the next property. £60k salary is going to get you £240k with dependents. That gives you £450k for the next home.

Lot of assumptions there old chap, not least of which is that house prices will rise at rates well above averages.

Graham_Devon

AndyGuil wrote: »

If you are looking at kids then there is going to be equity from the current property to consider too.

With assumptions like this, there is clearly no point in discussing it further.

Now "people with kids" almost unquestionably have equity.

AndyGuil

Generali wrote: »

Lot of assumptions there old chap, not least of which is that house prices will rise at rates well above averages.

Not really as the next place will be cheaper if the HPI is less. 10% has been very modest recently!

Graham_Devon

AndyGuil wrote: »

Not really as the next place will be cheaper if the HPI is less. 10% has been very modest recently!

So what are we left with? A couple of lawyers working full time, with kids, but essentially, who already own a house, with equity, who are moving to a cheaper area....which suggests moving even further out of the areas that Generali posted.

Prices will be affordable then?

Fantastic. Won me over.