Wednesday, Jun 13, 2007
We are now below affordability levels of late 80s
Mail: £115,000 just to get a foot on the housing ladder
"Britain's 3.8million first-time buyers were paying an average of 18.7 per cent of their gross monthly income on mortgage repayments in April. This is the highest figure since the beginning of 1992. Rising rates are also affecting home movers, who were paying 16.3 per cent of their income on mortgages in April - also the highest level since 1992. These figures will worsen because they do not include the quarter-point rise in the base rate in May." Good luck to all home owners!!
Posted by confused76 @ 10:17 AM (145 views) Add Comment
6 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. maddison said...
There is no point comparing affordability measures from 1992 as they post dated the crash and the economy was nothing like it is now, no one was moving and in 1992 there was a huge spike in interest rates to try and defend the pound. What really matters is the affordability just before the crash ie 1989 which I dont know...
2. Pelethar said...
Some of the comments at the bottom of this article are priceless. The Mail readers are panicking, and it's a joy to behold. Check this lot out:
Citing the fact that the MPC lowered interest rates to 3% in 2001 when house prices were rampant M King said explicitly that Interest Rates would never be used to control house prices. So why raise them now because of house prices I call LIAR! They put them up using the house prices as the excuse when it suits them.
- Ajp, UK
Very clever - bring down interest rates, encourage house prices to rise then offer people larger morgages. Surprise, surprise - a few years later up the interest rates. Make more money for the banks by the increasing interest rates on the larger loans, then drive people into debt and reprocess their homes so the banks now own them. The bank always wins and continues make large profits. STINKS doesn't it?! The government are going to have so many more people to look after in their old age who can afford to pay into pension savings schemes?
- Jo Smith, Bracknell
If those banks raise there interest rates any further there won't be an economy left to run.
- Suzan Gumush, Chislehurst
It's intellectually lazy and frankly pathetic for these eggheads at the Bank to just rack up interest rates because they think the middle class are actually making a bit of money from the housing market. So what? Why can't the Government make lenders more accountable for bad debt? The Bank will induce a recession with these consistent rises.
- Dan, Surrey
3. confused76 said...
Interests / take home pay = 17.90% for FTBs in 1987, i.e. better than now, see table in the article
4. bidin'matime said...
When a single building plot across the road from us went for £210k at auction in Feb 1989 I knew it was time to sell and get out Unfortunately this was not feasible due to young family, living in a half renovated ‘house of our dreams’ – so we stayed and eventually sold 6 years later, a fully renovated house, with double the land, for… £210k. Wont get fooled again…
5. Workingholiday said...
Where does that 16% come from? If was to FTB tommorow, it'll be somewhere near 50-60%.
6. Blindleadtheblind said...
Since when has the average salary been 35k??