First Time Buyer Deposit - interesting info...

wymondham

In my email I get from the Money Charity, this month there is this nugget that I thought was interesting:

"It would take 37 years for someone on the average salary, saving the average amount per household every year in an average instant access savings account, to afford the average first-time buyer deposit"

wow!

michaels

Funnily enough when I was saving for a deposit I saved more than I do now. Also my family circumstances were totally different at that time so it was much easier for me to save.

Is there really any point in these average house price vs average ... comparisons?

The average British woman can't fit in a size 10 dress and yet size 10 dresses are still sold....

cells

Lots of important factors are missed in the 'are house prices unaffordable/expensive' data/debate

The median price is cheaper than the mean

Expensive areas skew the mean average

People pay with income which is incorrectly often quoted as average incomes which include working kidaults and part timers. Much more reasonable to look at full time employed for a year or more average wages which is a good deal higher than the 'average'

People pay with inheritances. Sure its unfair some people dont get inheritances but it is foolish to ignore the iirc some 500,000 inheritances which are left each year and a lot of that goes to buying property. Often the more expensive areas leave bigger inheritances are richer people tend to buy in the expensive areas

The average person should not be able to afford the average for sale property. If that was true who would we put in the 5 million social homes? leave them empty to root away? Of course if these 5 million units were sold under RTB then you can say the average person should be able to afford the average home

Another way to decide if property is cheap or expensive is to look at the builders margins over a period of a few years. They area reasonable now but its not like the builders have margins like apple its more like Samsung.

martinsurrey

wymondham wrote: »

In my email I get from the Money Charity, this month there is this nugget that I thought was interesting:

"It would take 37 years for someone on the average salary, saving the average amount per household every year in an average instant access savings account, to afford the average first-time buyer deposit"

wow!

did you know that if the average baby born today grew for 18 years at the average rate for the average UK person it wouldn't reach 2ft tall.

lies, damn lies, and statistics

westernpromise

wymondham wrote: »

In my email I get from the Money Charity, this month there is this nugget that I thought was interesting:

"It would take 37 years for someone on the average salary, saving the average amount per household every year in an average instant access savings account, to afford the average first-time buyer deposit"

wow!

The average owner of the average home has 45% of its value as equity.

Makes the mortgage look affordable all of a sudden.

HornetSaver

A more relevant way of interpreting the statistic (which several have demeaned but no-one has attempted to dispute the accuracy of) is that if you are not in a position to aggressively save, then your best hope of getting onto the property ladder before middle-age is the untimely demise of your parents.

I'm on an above average salary (I reckon at least the median full time earnings for someone in London, though I'm still young in career terms and thus still climbing), and allowing for expected earnings growth and typical price increases I estimate it would take me five years to get to a sixth of asking price on a smallish two bed flat in a middle-of-the-road area in Western or Central Hertfordshire. Sounds reasonable.

But I'm not a typical prospective first-time buyer. Even without inheritance I'm in a better financial position than the majority of Londoners looking to first time buy, let alone the UK or Home Counties average. I have no responsibilities (though am planning ahead for a two bedroom property on the basis that I'm likely to by the time I can afford to buy a one-bed - if I don't have responsibilities at that stage I'll probably get on the ladder ASAP as that's more cost effective than renting until I can afford bigger). I'm perfectly open to doing a super commute for a few years in order to get onto the ladder a few years earlier, though in practise that would tie me down to remaining at my existing employer because commuting to London is already a fair chunk of time from my current location.

If someone in my position is finding it a slog, then the entire system is :mad:

economic

A point that is always forgetton by researchers, economists and pretty much everyone is that property transacts at the margin. That is there only needs to be enough people who can afford property to drive the demand. Which makes mean and even median salary ratios meaningless. What these ratios do show is the rising inequality. I remember when I was in Myanmar few years back and asked a local about property prices in Yangon. I was shocked. For a two bed apartment in a fairly central area it was something like £2-300k. I can't remember the extract amount but it was roughly around that price. Now imagine the salary to house price ratio for Yangon!!! According to the incompetent researchers/economists Yangon would be the ultimate property bubble yet it still hasn't burst....

CLAPTON

HornetSaver wrote: »

A more relevant way of interpreting the statistic (which several have demeaned but no-one has attempted to dispute the accuracy of) is that if you are not in a position to aggressively save, then your best hope of getting onto the property ladder before middle-age is the untimely demise of your parents.

I'm on an above average salary (I reckon at least the median full time earnings for someone in London, though I'm still young in career terms and thus still climbing), and allowing for expected earnings growth and typical price increases I estimate it would take me five years to get to a sixth of asking price on a smallish two bed flat in a middle-of-the-road area in Western or Central Hertfordshire. Sounds reasonable.

But I'm not a typical prospective first-time buyer. Even without inheritance I'm in a better financial position than the majority of Londoners looking to first time buy, let alone the UK or Home Counties average. I have no responsibilities (though am planning ahead for a two bedroom property on the basis that I'm likely to by the time I can afford to buy a one-bed - if I don't have responsibilities at that stage I'll probably get on the ladder ASAP as that's more cost effective than renting until I can afford bigger). I'm perfectly open to doing a super commute for a few years in order to get onto the ladder a few years earlier, though in practise that would tie me down to remaining at my existing employer because commuting to London is already a fair chunk of time from my current location.

If someone in my position is finding it a slog, then the entire system is :mad:

the best way for the young to ensure they can get to live in an family sized house, is to vote exit and stop significant immigration : and build some more houses of course.