House Prices 10 x Earnings Now.

lisyloo

Nothing wrong with one bedroom flat to start off with.

Fertility window.
Female fertility starts going downhill quite fast at 35.

I've lived in some pretty small flat/studios in London - the type that are a masterclass in miniturisation e.g. the table is a flap on the wall and you sit on the end of the bed, the "kitchen" is inside a cupboard and you need to sit at an angle on the loo because there isn't room for your knees to go straight, the sink is the size of a shoe box.
Difficult to see how you could cram more people into the tiny flats in London although I accept houses will see higher occupancy.

cells

mwpt wrote: »

Interest rates dropped over that timeframe. I would sorely love to see a graph showing monthly mortgage payments vs monthly rents over that term. They'd be much more closely linked than the rents vs asset price graph.

But still, someone should be along shortly to re-explain supply/demand to me.

interest rates are important but supply and demand is more important

look at the UK we have the same banks and interest rates across England but clearly London has outperformed the rest of England.

The difference is of course clear by the fact that London population grew by 12% over the decade and the rest of England minus London grew by closer to 6%

If 500,000 people (250,000 households) vacated London tomorrow which would make London population growth the same as Englands then i'm sure the price would be lower.

Also I think London GDP has grown faster than the rest of the UK as its geared more to foreign trade be it tourism or service exports

cells

lisyloo wrote: »

Fertility window.
Female fertility starts going downhill quite fast at 35.

I've lived in some pretty small flat/studios in London - the type that are a masterclass in miniturisation e.g. the table is a flap on the wall and you sit on the end of the bed, the "kitchen" is inside a cupboard and you need to sit at an angle on the loo because there isn't room for your knees to go straight, the sink is the size of a shoe box.
Difficult to see how you could cram more people into the tiny flats in London although I accept houses will see higher occupancy.

the higher density will be via
kidaults leaving their parents homes later and later
more and more HMOs.
smaller households (eg a widow or a pensioner) leaving London and being replaced by families or HMOs

there is also this semi visible cramming which is the trainsm as more and more families go further out the trains get more congested

ukcarper

martinsurrey wrote: »

average age of first time buyer in 1960 was 23

average now is 31-35

a 1 bed flat might be fine if you're a 20 year old, but try that with a family in your 30's...

Yes but people started work earlier, got married earlier and had children earlier in fact the country was a totally different place in the 60s.

PasturesNew

Generali wrote: »

In the end, compound interest kills the argument that the current situation can be sustained. It's just a matter of when.

Maybe the next stage is for all the furren oligarchs/billionaires to buy up everything, then force us to live 5 to a room in exchange for 70% of our takehome pay.

martinsurrey

ukcarper wrote: »

Yes but people started work earlier, got married earlier and had children earlier in fact the country was a totally different place in the 60s.

http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-327586

table 4a this is a housing thread and I was relating home ownership to family situation, and why a first time buyer now tries to skip the first rung (a 1 bed flat being no good).

average age of first time mum in 2013 - 28.3

average age of first time mum in 1960 - 24.6

so your average 1960 first time mother was a 2 year home owner

and your average current first time mother has 2-4 years of renting ahead of them.

(not exact as the 2 groups don't exactly overlap, but its a fair comparison.)

ukcarper

martinsurrey wrote: »

http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-327586

table 4a this is a housing thread and I was relating home ownership to family situation, and why a first time buyer now tries to skip the first rung (a 1 bed flat being no good).

average age of first time mum in 2013 - 28.3

average age of first time mum in 1960 - 24.6

so your average 1960 first time mother was a 2 year home owner

and your average current first time mother has 2-4 years of renting ahead of them.

(not exact as the 2 groups don't exactly overlap, but its a fair comparison.)

No where near as simple as that though and if you choose to rent and have children before you buy it will increase the time before you can buy. The main reason people buy later now is not the price of property but lifestyle. At the average age of 23 in the 60s the majority of people will have been in work for 8 years now a large number of people will be 30 before they have been in work 8 years.

HENRY78

The system is broken and needs a complete overhaul. Where I live in South West Hertforshire prices in the last year alone have increased by 20%, Its absolutely mental.
When a bog standard 3 bed semi needing a load of work to bring it up to date is in an "ok" area is on the market for £550,000 which is x20 the average salary for the area or x10 joint income then something is seriously wrong.

Herzlos

ukcarper wrote: »

No where near as simple as that though and if you choose to rent and have children before you buy it will increase the time before you can buy. The main reason people buy later now is not the price of property but lifestyle. At the average age of 23 in the 60s the majority of people will have been in work for 8 years now a large number of people will be 30 before they have been in work 8 years.

What kind of salary would someone who started work at 15 in the 60's expect to get 8 years later? Since they would have no school grades, I'm assuming the only way to get a good job would be an apprenticeship? Or factory work?

These days, I'd expect the average uni graduate (first job at 22) to be earning a fair bit more than the average school leaver (first job at 16), 6 years later. Obviously I'm ignoring saturday jobs and the like.

martinsurrey

Herzlos wrote: »

What kind of salary would someone who started work at 15 in the 60's expect to get 8 years later? Since they would have no school grades, I'm assuming the only way to get a good job would be an apprenticeship? Or factory work?

These days, I'd expect the average uni graduate (first job at 22) to be earning a fair bit more than the average school leaver (first job at 16), 6 years later. Obviously I'm ignoring saturday jobs and the like.

yes, I was just looking for the 1960 stats on this but they're hard to come by, the 1960 8 year worker is equivalent to a 24 year old who left school after GCSE's, I wonder how many 24 year old with only GCSE's are buying houses in 2015?

but I'm not going to labour the point, I cant see UK changing his mind...