Why have house prices increased so much over the last twenty years?

Chrysalis

House supply has been too low for decades, I dont think there has been any period of over supply at all in my lifetime. Only localised spots.

I expect the growth in population in the late 1990s still was higher than the new houses been built.

BTL landlords dont need to be sellers, if they just buyers, they create demand to buy properties which in turn helps it become a sellers market.

GreatApe

Chrysalis wrote: »

House supply has been too low for decades, I dont think there has been any period of over supply at all in my lifetime. Only localised spots.

I expect the growth in population in the late 1990s still was higher than the new houses been built.

BTL landlords dont need to be sellers, if they just buyers, they create demand to buy properties which in turn helps it become a sellers market.

Its hard to call if housing demand and supply are balanced because there isn't a specific definition of how much housing a nation needs. With food we can say less than 2000 calories per person is a shortage more than 2500 is an excess. You can't really do that with housing.

The best you can do is perhaps a to define it as price vs reinstatement cost.

If the price is below reinstatement cost then there is an excess of homes in that area.
In a lot of the country homes are indeed below or near the reinstatement cost.
£120,000 buys a 3 bedroom terrace in Birmingham. It's very hard to build a new 3 bed home for £120,000 so there is no shortage in Birmingham. The same can Abe said for most of Scotland Wales NI north east&west england Midlands. Most the country housing is plentiful and cheap/affordable

MobileSaver

Money_saving_maniac wrote: »

Of course most of it is due to immigration.

Immigration is a factor, it's not the spawn of the devil that most Brexiteers would have people believe.

Natural change is another factor; people are living longer and health care is improving so each year there are more births than deaths.

However an even more important change is lifestyle. Back in the day two people would marry young, possibly live with parents for a while and then get their own place and for the most part stay together for the majority of the rest of their lives. So two people needed one property.

These days most (particularly younger) people think of themselves first and foremost; they want their own place as soon as they can fly the nest, they're less likely to settle down with a partner until older and even after kids are on the scene they're much more likely to split up with a partner and need their own place again than it ever was back in the 50s and 60s. So in many cases two people need two properties. It doesn't take a genius to work out what additional pressure this puts on the housing market...

Malthusian

MobileSaver wrote: »

These days most (particularly younger) people think of themselves first and foremost; they want their own place as soon as they can fly the nest, they're less likely to settle down with a partner until older and even after kids are on the scene they're much more likely to split up with a partner and need their own place again than it ever was back in the 50s and 60s. So in many cases two people need two properties. It doesn't take a genius to work out what additional pressure this puts on the housing market...

Thank goodness for immigrants, who are happy to have an extended family of 8 in one property or live with 20 other labourers on cots in one property. I am not being sarcastic. They balance out the natives who regard a studio flat as a basic right and a 3-bedroom terrace as the bottom rung on the housing ladder, even for childless singletons.

GreatApe

Malthusian wrote: »

Thank goodness for immigrants, who are happy to have an extended family of 8 in one property or live with 20 other labourers on cots in one property. I am not being sarcastic. They balance out the natives who regard a studio flat as a basic right and a 3-bedroom terrace as the bottom rung on the housing ladder, even for childless singletons.

Thank goodness for HMO landlords that take single homes and turn them into 6 bedroom 6 bathroom HMOs effectively adding supply of bedrooms.

Thrugelmir

GreatApe wrote: »

Why did house prices go up a lot between say 1995-2000?

Securitisation of mortgage debt in the UK.

Bradford and Bingley being one of the primary instigators. Not unsurprisingly Northern Rock were the masters of the art.

Both companies of course still reside in UK Asset Resolution. Where the residue of the mortgage books are slowly being run off.

Chrysalis

Malthusian wrote: »

Thank goodness for immigrants, who are happy to have an extended family of 8 in one property or live with 20 other labourers on cots in one property. I am not being sarcastic. They balance out the natives who regard a studio flat as a basic right and a 3-bedroom terrace as the bottom rung on the housing ladder, even for childless singletons.

why dont you move to a bedsit considering you consider it suitable for living.

my last bedsit was barely a box room and it had a low sloped roof. so couldnt even stand up fully. I also remember having to go to and from the bathroom with just towel round me in full view of neighbours and their mates attending parties etc.

I do believe a self contained flat should be the aimed minimum accommodation size for long term accommodation. Its not just shelter but also privacy should be a basic right.

Its a bit different when a large family is squashed in a house as they at least not strangers.

I dont know anyone who expects a 3 bed house as a minimum size when they single and no children.

I can understand why people would want a spare room tho as storage space is useful.

Chrysalis

GreatApe wrote: »

Its hard to call if housing demand and supply are balanced because there isn't a specific definition of how much housing a nation needs. With food we can say less than 2000 calories per person is a shortage more than 2500 is an excess. You can't really do that with housing.

The best you can do is perhaps a to define it as price vs reinstatement cost.

If the price is below reinstatement cost then there is an excess of homes in that area.
In a lot of the country homes are indeed below or near the reinstatement cost.
£120,000 buys a 3 bedroom terrace in Birmingham. It's very hard to build a new 3 bed home for £120,000 so there is no shortage in Birmingham. The same can Abe said for most of Scotland Wales NI north east&west england Midlands. Most the country housing is plentiful and cheap/affordable

So Birmingham has no waiting lists for affordable accommodation, and house prices are no higher than 3.5x average salary?

hutman

Uncontrolled EU Immigration. Cheap flights from Warsaw/Barcelona into UK. And lots of it.

westernpromise

Chrysalis wrote: »

So Birmingham has no waiting lists for affordable accommodation, and house prices are no higher than 3.5x average salary?

What's special about 3.5x salary?

Are you one of those Stone Age Labour Party types who wants women returned to being considered husbands' chattels in the tax system?