Renting in your 40's and staring into the abyss

remorseless

lisyloo wrote: »

I find it rather amusing.
Wages have been going up for about 5 minutes (I exaggerate) ok 6 months, after 5 years of real terms decreases.
CPI is now close to zero after many many years of price increases - and many would argue that CPI does not represent the true situation of those on low/fixed income who don't buy decking, patio heaters or flights abroad.
I am delighted that finally things seem to be turning around, but the fact that we've been getting (on average) slightly above inflation pay increases for 5 minutes, does not mean we are cooking on gas after many many years of being squeezed.

Maybe I am used to worse, but really, it's not that bad.

The main thing I am finding expensive (compared back home) is eating out... but basic stuff, seems pretty good!

What do people expect from the economy? Everybody to be on £100k doing 9-5 and 4 bed houses for £50k and subsidised everything? Let me throw you a high state pension with a free microwave too!

wotsthat

dktreesea wrote: »

To me she's exactly the right sort of person for the problems being highlighted on this thread.

She got a degree and a decent job to go with it, so doesn't sponge off the tax payer to support her children.

She delayed entering the job market so she could get the necessary higher qualifications, presumably (which may have included needing to travel) to ensure she could have a careeer in academia. No mean feat.

She joined the baby breeding programme, which everyone in Britain is under huge pressure to join in on, hence the heavy "investment" of our taxes by the government in things like child benefit, child tax benefit, free child care, free school (not even so much as an annual levy, not to mention not even having to stum,p up for the jotters the children use. Seriously, our non user pays attitude to education is scary), housing benefit tailored to however many children you have etc etc.

She, presumably, spent on her children rather than banking her money and saving for a deposit on a house, but hey, like I say, the government's attitude is "breed, baby, breed!"

Yes, she can't afford to put a deposit on a house just now, but that shouldn't mean she should have to invest a massive percentage of her income on rent just to rent a halfway decent house close to decent schools.

Did you gasp with disbelief when I said I had qualifications, kids, a house and managed quite a lot of travelling too? Of course not - she's the exception - not me.

lisyloo

Maybe I am used to worse, but really, it's not that bad.

I am not saying it's bad.
I am saying that inflation has been down to zero for about 5 minutes (as amply demonstrated from your graph) and that gets extrapolated to everything is fine now.
The price rises we have seen are permanent. CPI is only a measure if the last 12 months, all the price rises before that still exist but aren't included in CPI.
I'm not saying it's bad at all, it's a great trend, but we have to live with the consequences of what went before the 12 month measure which is cummulative price rises and cummulative lack of payrises.

Graham_Devon

lisyloo wrote: »

I am delighted that finally things seem to be turning around, but the fact that we've been getting (on average) slightly above inflation pay increases for 5 minutes, does not mean we are cooking on gas after many many years of being squeezed.

I've always found the argument baffling to be honest.

It's almost as if people genuinely believe that a loaf of bread falling by 20p somehow compensates people for house prices rising by £1,000 a month.

Cornucopia

Graham_Devon wrote: »

I've always found the argument baffling to be honest.

It's almost as if people genuinely believe that a loaf of bread falling by 20p somehow compensates people for house prices rising by £1,000 a month.

Isn't it the other way around?

The fact that food, electronics, services are all cheaper in real terms means that there is potential disposable income for people to spend on housing, which has the effect of adding to upwards momentum in prices.

lisyloo

Cornucopia wrote: »

Isn't it the other way around?

The fact that food, electronics, services are all cheaper in real terms means that there is potential disposable income for people to spend on housing, which has the effect of adding to upwards momentum in prices.

Theorectically I guess that's right, but if you're talking about households having an extra £5 per month that they did 6 months ago then in practice it's tiny compared with the wall of money coming from the rest of the world.

Cornucopia

We're not talking about that though, are we?

We're talking about two incomes typically being deployed now, where it was probably one or one-and-a-half 50 years ago.

We're talking about periods of time when a couple would come together, both holding equity from previous home purchases.

And we're talking about long-term differential rates of inflation that are potentially saving new home owners several hundred pounds, exactly at the point in time when it is relevant to house purchase.

This is what I mean when I say that HPC arguments are economically illiterate. A market in which demand outstrips supply, and in which satisfying the demand is a critical human need (and a cultural one), and in which there is a ready supply of money, will simply hoover up that money in the form of price inflation. They do not understand this.

GunJack

Cornucopia wrote: »

Isn't it the other way around?

The fact that food, electronics, services are all cheaper in real terms means that there is potential disposable income for people to spend on housing, which has the effect of adding to upwards momentum in prices.

but the sums of money of "disposable" income don't come anywhere near extra affordability for housing...

...makes me laugh that raising the tax threshold by £600 is seen by politicians as such a big thing...in terms of disposable income it's £10 a month....that'll go far....

lisyloo

and in which satisfying the demand is a critical human need

Just to be clear, shelter is a critical human need, owning a home is not a critical human need.

Cornucopia

lisyloo wrote: »

Just to be clear, shelter is a critical human need, owning a home is not a critical human need.

Yes... but we aspire to doric columns, not shanty towns - both individually, and as a society. (In fact, shanty towns are generally denied to people as a housing option in the UK by the Powers That Be).