The UK housing market is an example of junkie style economics

Graham_Devon

cells wrote: »

but to be fair on him just a few weeks ago I would have agreed that pretty much everywhere in England has a shortage of homes. Now its clear that a lot of places in England do not have a problem as the average terrace costs less than 3.5 x the average full time wage in many English towns and cities.

You are losing the plot!

I didn't get around to this on your other thread, but please.... you are comparing local house prices with the national average wage.

While a nice little terrace in Powys, Wales may well be around 90k to buy, the average wage is no where near the national average wage. The average wage of all earners (median) is £19,000.

This premise you keep pedaling simply isn't correct. What matters in these localities is the house price ALONGSIDE the local average wage. Not the house price compared to a national average wage.

I don't know why you won't entertain any of this.

ukcarper

Graham_Devon wrote: »

You are losing the plot!

I didn't get around to this on your other thread, but please.... you are comparing local house prices with the national average wage.

While a nice little terrace in Powys, Wales may well be around 90k to buy, the average wage is no where near the national average wage. The average wage of all earners (median) is £19,000.

This premise you keep pedaling simply isn't correct. What matters in these localities is the house price ALONGSIDE the local average wage. Not the house price compared to a national average wage.

I don't know why you won't entertain any of this.

If you look at cells's thread you will see he has taken the trouble to compare median earnings In that area with price of average terrace in that area.

You should use full time workers not all workers.

Graham_Devon

ukcarper wrote: »

You should use full time workers not all workers.

All workers is the reality though carper.

And this is where data and how to view it starts going wrong.

You will view only the very best data and ignore the rest. What's the point in that though? What's the point in only looking at couples who both work full time? You are excluding huge chunks of the nation and then suggesting there isn't a housing problem at all.

In South Wales for example, there are HUGE numbers of part time workers. If you only look at full time data, you ignore huge swathes of the population there.

And this is why all this talk of "house prices are affordable" goes wrong. You make the point that cells pointed out the earnings, but he also pointed out that if a couple work 104 hours a week between them they can afford a terrace. That's pretty extreme, but it allows him to continue the point that everything is affordable and life is a continual box of lovely chocolates.

The majority of couples, with a child or two for example will not both work full time. The average couple has one full time worker and one part time worker. So what's the point in constantly assuming that kids don't exist or that it's professional couples with kids who are going for the terraces?

It makes a point on paper, but that's it. Go outside and reality hits you.

You may aswell say to a local area that is under 4 feet of flood water "well, you don't have a problem, your average rain fall for December is only 2 feet across the entire month". They would quite rightly tell you where to go.

Averages on paper tell you one thing. The reality on the ground tells you something completely different. The reality though, is what matters.

kinger101

cells wrote: »

The UK housing market is fine, in 70% of England house prices are affordable or even cheap vs local full time wages

You're beginning to sound like a stuck record.

http://england.shelter.org.uk/__data/assets/pdf_file/0004/1076926/2015_02_26_Affordability_for_first_time_buyers_-_FINAL.pdf

You might want to think about the bit on page 8 regarding the deposit. And the bit on page 12 about declining home ownership.

I've already explained why your 70 % wasn't 70 %. You don't clearly understand averages. Half the properties are obviously above the average. These are not dispersed randomly. They often almost include entire counties.

You have to think about where the population is distributed as well. They are not spread evenly in the country. There are 8.6 million people in London and 53 million in England. So that's 16% of English people who don't live in an affordable area already. And before you counter you meant by land area, you have to accept it's people, and not sheep, cows and cabbages that are buying properties.

ukcarper

Graham_Devon wrote: »

All workers is the reality though carper.

And this is where data and how to view it starts going wrong.

You will view only the very best data and ignore the rest. What's the point in that though? What's the point in only looking at couples who both work full time? You are excluding huge chunks of the nation and then suggesting there isn't a housing problem at all.

In South Wales for example, there are HUGE numbers of part time workers. If you only look at full time data, you ignore huge swathes of the population there.

And this is why all this talk of "house prices are affordable" goes wrong. You make the point that cells pointed out the earnings, but he also pointed out that if a couple work 104 hours a week between them they can afford a terrace. That's pretty extreme, but it allows him to continue the point that everything is affordable.

The majority of couples, with a child or two for example will not both work full time. The average couple has one full time worker and one part time worker. So what's the point in constantly assuming that kids don't exist or that it's professional couples with kids who are going for the terraces?

It makes a point on paper, but that's it. Go outside and reality hits you.

So you think you should be able to buy working part time median full time earnings in Powys was £21.5k in 2014 and 54% were in full time jobs.

kinger101

ukcarper wrote: »

So you think you should be able to buy working part time median full time earnings in Powys was £21.5k in 2014.

An an ideal world, yes. But finding full time permanent employment is easier in some areas than others. I'd say Powys has to be one of the worst regions for this. There's not even a city there. Just a few small towns.

Graham_Devon

ukcarper wrote: »

So you think you should be able to buy working part time median full time earnings in Powys was £21.5k in 2014 and 54% were in full time jobs.

You've missed the point again even though I explicitly laid it out for you.

I'll try again.

It's not about what I think.

If half the population of Powys are working part time (random made up figure) then there is no point suggesting there isn't a problem in Powys, because if you are working full time you can (just about) afford a terrace (though it's doubtful you'd get a mortgage for 4.5x income if you have any other expenses such as a car loan or kids).

You've ignored the very fact that you've excluded half the population. They all need somewhere to live. If they can't find full time work they have to do whatever they can. You've ignored the fact they need a deposit. You've ignored the fact they need to be debt free at these income levels. You've ignored local working economies. You've ignored the fact that in many areas, there won't be all that many terraces (skewing your figures wildly), or that the area is flooded with terraces but people need 3 bed homes. You've ignored EVERYTHING but 2 paper figures and made a massive conclusion out of that.

ALL workers looks at the wage of all workers, obviously. You could look at full time data alone and think "ahhh, full time workers in Powys are on 21.5k, grand". But if you ignore the fact that only 7% are full time workers due to the local economy and 93% are part time (random made up figures before you correct me and ignore the point) you are only allowing yourself to see half the picture. At that point, when it's being pointed out to you and you still continue to do it, I'd say more fool you.

Why can you not ask yourself....if housing is so affordable in places like Powys, why does it have one of the lowest rates of owner occupation in the country!?

ukcarper

kinger101 wrote: »

An an ideal world, yes. But finding full time permanent employment is easier in some areas than others. I'd say Powys has to be one of the worst regions for this. There's not even a city there. Just a few small towns.

Yet 54% of people of working age are in full time employment.

I agree in an ideal world that would be good but it's not happened in the past and is unlikely to happen in the future.

ukcarper

Graham_Devon wrote: »

You've missed the point again even though I explicitly laid it out for you.

I'll try again.

It's not about what I think.

If half the population of Powys are working part time (random made up figure) then there is no point suggesting there isn't a problem in Powys, because if you are working full time you can (just about) afford a terrace (though it's doubtful you'd get a mortgage for 4.5x income if you have any other expenses such as a car loan or kids).

You've ignored the very fact that you've excluded half the population. They all need somewhere to live. If they can't find full time work they have to do whatever they can.

ALL workers looks at the wage of all workers, obviously. You could look at full time data alone and think "ahhh, full time workers in Powys are on 21.5k, grand". But if you ignore the fact that only 7% are full time workers due to the local economy and 93% are part time (random made up figures before you correct me and ignore the point) you are only allowing yourself to see half the picture. At that point, when it's being pointed out to you and you still continue to do it, I'd say more fool you.

54% work full time 23% part time. After 10% deposit £81k 3.76x mortgae if other half of couple is part time minimum wage 3x joint income mortgage.

Graham_Devon

ukcarper wrote: »

54% work full time 23% part time. After 10% deposit £81k 3.76x mortgae if other half of couple is part time minimum wage 3x joint income mortgage.

And now were just about getting there.

Have you been to Powys?

How many people walking around these little towns in Powys, who currently don't have a house, do you think are walking around with 15k savings in the bank?

How many of those actually require an ex mining 2 bed house in the middle of the valleys? How many actually need 3 beds due to kids? Loads of people can afford a house that's far too small or inadequate for them. Your paper statistic would say "look, they can afford it". Reality would say "great, and whats the point in them buying that"? I suppose you'd say to a couple with 4 kids "you don't have a problem, on your wages you can afford to buy property - have a look at this studio flat"?

Were getting there though. Hopefully you are now finally opening your eyes as to why paper figures plucked from statistics hardly ever match the reality on the ground.