House Price Crash Discussion Thread

WTF?_2

wolvoman wrote: »

And anyway income isn't everything.
I know a girl in London, late 20s, works as a primary school teacher yet lives in a flat that must be worth £500K that her parents bought outright about 15 years ago and gave it to her. She must take home around £1500 a month I guess.
One of my friends rents a place not far from there with his g/f and baby and pays £1800 a month in rent alone. His take home is around £3500 I would guess, so after rent he is actually worse off then her, even though he earns 3 times as much.

Yes - thanks to reckless overblown lending and the resultant house price hyperinflation, ordinary people are finding themselves saddled with extraordinary amounts of debt just to live in a decent place. Resulting in a massive mortgage repayment or else high rents cutting severely into disposable income.

Regular-earning people think nothing of spending 200k+ (mostly borrowed) on an average house. Ten years ago you'd only have spent that sort of money if you were very well off and were buying a superb house.

Once the debt hangover really starts we are going to find it simply mind-boggling that such large sums of money were chucked at property. What is it about property that makes people lose their financial marbles?

brit1234

Its very interesting times at the moment. We have had a week where 125% mortgages have been abolished, Northern Rock turning down new mortgages and asking existing borrows to remortgage else where. Alliance and Leicester losing huge profits and rumors they are stopping lending.

The simple fact is prices are going to start to fall faster, the status quo is over. People expecting the market to pick up are deluded because you won't be able to complete the chains as banks have restricted their lending even more. The supply of property is rising fast along with repossessions (strangely majority Northern Rock buy to let flats)

dweeby

wolvoman wrote: »

I know a girl in London, late 20s, works as a primary school teacher yet lives in a flat that must be worth £500K that her parents bought outright about 15 years ago and gave it to her. She must take home around £1500 a month I guess.
One of my friends rents a place not far from there with his g/f and baby and pays £1800 a month in rent alone. His take home is around £3500 I would guess, so after rent he is actually worse off then her.

Hmm, so:

her: £1500 take-home, no rent = £1500 - £0 = £1500 disposable income.

him: £3500 take-home, £1800 rent = £3500 - £1800 = £1700 disposable income.

How is he actually worse off than her?

And, what was the point of your post, to illustrate that someone who is given a £500k home is better off than they otherwise would be? I think we know that!

Andread

t_i_g_e_rr wrote: »

Yes, in my particular case the house I'm interested in right now is a repossession, which, in my (admittedly novice) opinion, is already 10% below average. So I think the only relevant question can be, how much below the average for the area, based on propertypriceadvice.co.uk, or maybe hometrack.

PS. The help, advice, and opinion on these forums is a real help to me. Thanks to all.

I have just put in some information about a house i have been looking at on the site propertypriceadvice.co.uk that you mentioned and it shows the house i was looking at is valued at an average of £60.000 less than the estate agents are asking. I will mention this to them and see what they say, i have printed off the information. I am gob smacked!!!!!

neverdespairgirl

fc123 wrote: »

When I look back to how we lived (existed) on the suburban hamster wheel, I am shocked at myself for not challenging our lifestyle at any point.
It wasn't "chosen" it just evolved.

The 2 cars were "essential" as both of us worked and had school drop offs etc. but the expense of supporting that type of lifestyle.:eek:

That is a choice, though, even if not one you sat down and made one sunny afternoon.

We don't live a Suburban lifestyle - we live in central London (which helps with transport, of course).

John_Pierpoint

fc123 wrote: »

Don't know that author but "Enough" by John Naish (published 3 wks back) expands on a similar theme but in a more "popular" style. Fab book...would recommend....made me feel much better about my life.

Is this the bloke who has awarded "The Landfill Prize" to the Phillips 150 GBP electrical toothbrush?

John

PS neverdespairgirl, are you a teeny weeny bit worried about your child's education ?

neverdespairgirl

John_Pierpoint wrote: »

PS neverdespairgirl, are you a teeny weeny bit worried about you child's education ?

No - he's 2. So he doesn't have any formal education at the moment.

However, our childcare costs now are more than it would cost to send him to a private school, so if necessary we can do that.

Generali

neverdespairgirl wrote: »

No - he's 2. So he doesn't have any formal education at the moment.

However, our childcare costs now are more than it would cost to send him to a private school, so if necessary we can do that.

There are some excellent and relatively inexpensive private schools in Central London, eg St Pauls, City of London School for Girls.

neverdespairgirl

Generali wrote: »

There are some excellent and relatively inexpensive private schools in Central London, eg St Pauls, City of London School for Girls.

I don't think City of London School for Girls would suit my son (-:

My mother taught there before I was born, and later at James Allen's Girls' School in Dulwich, where my sisters and I were educated. A great school, I really liked it.

My brother went to Westminster, which by no stretch of the imagination is even relatively inexpensive!

John_Pierpoint

I think you are both demonstrating that people living inside the North & South circular , and especially those in travel zones 1 & 2 need to be "well off", or in social housing.

It is a great place to be footloose and fancy free or DINKY's; but difficult to raise a family. It can also be amazingly riven with social distinctions, where a couple of streets can create the "wrong side of the tracks" effect.