House prices increasing nine times faster than first time buyer wages?

HornetSaver

According to the IFS, house prices in England have risen 173% since 1996. Meanwhile, average wages in the 25-34 age bracket - the age group which has traditionally had the highest proportion of first time buyers and which is the most common age bracket within which to start a family - have risen 19%.



https://www.bbc.co.uk/news/business-45776289


Yes, of course there are root causes behind the house price boom, the only comment I'd make being that a sizeable chunk of the boom came before 2004. But it does blow out of the water the argument that many make about things always having been just as hard, youngsters would be fine if they do as we did, etc etc.

Newnoel

The real issue here relates to Labour throwing open the gates to immigration in 1997. Net immigration tripled in Labour's first term and we are still living with the repercussions, one of which is runaway house price inflation until Osborne finally put the brakes on through his tax changes

ukcarper

The other thing is 1993 was almost the lowest house price to earnings have been well below long term average, if you went back a few years earlier figure would be different.

StevieJ

HornetSaver wrote: »

Yes, of course there are root causes behind the house price boom, the only comment I'd make being that a sizeable chunk of the boom came before 2004. But it does blow out of the water the argument that many make about things always having been just as hard, youngsters would be fine if they do as we did, etc etc.

Then again in the late 80's early 90's base rate was 2000% higher than it is now? Even so, I admit it is more difficult now to get on the property ladder, it wasn't a 'piece of cake' in the past though.
http://www.houseweb.co.uk/house/market/graph.html

GreatApe

Ownership rates for uk born citizens are near historic highs so the talk of unaffordability is simply false.
The only time they were marginally higher was a few years before the crash when the banks were willing to lend to the black market workers via self cert mortgages.

GreatApe

To add, in 2017 ownership rates increased by iirc ~250,000 homes and I suspect 2018 will be similar so again an indicator that suggests just looking at price is not a good indication of 'affordability'.

Merlin139

Build more affordable houses and don't allow them to be bought by BTL landlords.

bertiewhite

According to Crashytime, they'll be dropping again soon. Maybe.

PixelPound

So is it rising or is it falling
https://www.theguardian.com/business/2018/oct/05/uk-house-prices-fell-sharply-in-september-amid-brexit-wariness

UK house prices unexpectedly dropped at the fastest pace for almost six months in September, according to Halifax, as the number of homes for sale in 2018 fell to a decade low.

Britain’s biggest mortgage lender said the average price of a home in Britain dropped to £225,995 last month, down 1.4% from the level recorded in August. The price of a home remained 2.5% higher than a year ago.

City economists had forecast month-on-month growth of 0.2% in September.

I suppose depending how you look at the figures you can get the outcome you want.

GreatApe

Merlin139 wrote: »

Build more affordable houses and don't allow them to be bought by BTL landlords.

How does council homes help people become owner occupiers?

If you want ownership to increase you have to sell down the social stock not expand it

In hackney the social stock is about 40% of all the homes which is more than twice the national average and ownership in hackney is really low as a result. After all if the council owns 40%+ of the stock that means no more than <60% of the homes can be owner homes.

HornetSaver

nic_c wrote: »

So is it rising or is it falling
https://www.theguardian.com/business/2018/oct/05/uk-house-prices-fell-sharply-in-september-amid-brexit-wariness


I suppose depending how you look at the figures you can get the outcome you want.

The fact is that they have risen, sharply above earnings of those starting families, over decades. Data from a few weeks or a couple of years might indicate the start of something different, but doesn't alter that simple fact.

Ownership rates for uk born citizens are near historic highs so the talk of unaffordability is simply false.
The only time they were marginally higher was a few years before the crash when the banks were willing to lend to the black market workers via self cert mortgages.

It wasn't limited to black market workers (and I'm fully aware that in the context you're using it, this applies to just about anyone who has ever done a cash-in-hand job). I'm aware of people who knew precisely what they earned as they and their partner both had defined earnings in defined jobs. It wasn't enough to borrow what they wanted at the rate they wanted, so they stated they were self employed. Some of these instances coming before 1996.

To add, in 2017 ownership rates increased by iirc ~250,000 homes and I suspect 2018 will be similar so again an indicator that suggests just looking at price is not a good indication of 'affordability'

Curious how a rate goes up by a quantity?



Which suggests to me that the figures you're using might refer to something other than the percentage of British-born people who own their own home, and be something closely related yet significantly different, such as the number of UK properties owned by British-born people.