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Everything posted by jcpricewatcher

  1. I know a few people from China who have bought several properties in London. Some have bought for their children to live in whilst studying in London (for some reason they still think that it is prestiguous to have a UK education). Others have bought as a safe store for their cash (they don't trust the Chinese government and cash in the bank in China earns no interest, much safer to spread your cash overseas out of the reach of the government. - Just like cash rich people in this country would be wise to spread their cash amongst multiple currencies). None have borrowed - all straight cash buys. I don't know of any who have bought to migrate over to London in order to raise their young children. Why would you do that? - Run you company in China, live like a king with cheap labour providing a house full of staff - use London property as relatively safe store for your cash. Some rent them out, but others can't be bothered with the hassle (as pointed out the yield is so low, just keep the place as good as new by not renting it out at all - no one trashes it, no worry about non payment of rent). Remember the culture in China is you make money, then you buy things outright. Pretty much summed up by the fact that China runs a trade surplus, vs the UK's deficit. You may joke that the Chinese people are not good business men, but one day people may wake up to realise that China has bought all the assets of the entire country! It's starting to happen in Mexico, a friend of mine has said that they have bought up many of the major shipping ports people are only just starting to cotton on. (It's also been happening in parts of Africa). At the end of the day, the Chinese government is spending all this trade surplus buying up assets (and govt debt) of other countries. Whilst the rest of the world continues becoming more indebted obliviously buying cheap tatt made by the Chinese enabling them to do this!
  2. I'd hate to commute 3hrs each way per day. I moved a further away and my commute changed from 20 mins each way to around an hour each way. At first it was much worse, but I guess after a while you sort of get used to it! An interesting question though... Whats the minimum you would have to be paid to consider taking a job which meant you had to be involved in a 6hr round trip daily commute? (for arguments sake lets say it costs 900 per month and you cant live closer because of family and you commute to different places of work which all happen to be exactly 6hr rounds trip from you home using mode of transport of your choice thus preventing local stop overs). I'm assuming most people have their price!
  3. I do agree with the others and that mortgage rates will rise (for new mortgages the spread to boe will rise). For that reason if you are to buy now or own now, remortgage yourself to a nice low lifetime boe tracker. A lot of people I know who either own or buying now/soonish are booking up with the HSBC 1.49%+boe lifetime tracker. (1.99% though need 40% deposit not a problem for most who bought 4+years ago) new buyers can still get 1.68%+boe with 30% deposit. But to be fair if you're spending 500k plus on a house in London hopefully you'll have at least 25% deposit built up.. I definitely do think that the desirable areas such as chiswick, Kingston and clapham plus nice z1-2 should suffered a lot less, since crash or no crash the desirable areas will still be sought after... From personal knowledge those who bought around 06 with lifetime trackers and 25% deposit will probably be paying 0.49%+boe... So yes 2% mortgages new or existing (from a house move) is perfectly achieveable...
  4. I say scrap road tax, reduce fuel duty and put tolls on the roads in a similar way to france. Oh and makepublic transport cheaper. At least foreign vehicles would actually have to pay to use the UK roads then. At the moment UK lorries have to pay UK road tax, then French and Spanish tolls. Whereas foreign ones pay nothing towards the UK roads!
  5. In the scenario you mention, it makes complete sense, especially if it's to be used frequently like you say. Accommodation during holidays is especially expensive in this country and if the place is just a drive away (a few hours), then there isn't the hassle of taking flights with kids. The familiar place for the kids would also be good. Of course if you are paying a big monthly mortgage in order to pay for the holiday home then it starts to make a lot less sense. Its also nice of them to let their friends stay for free... As some people say it's not all about maximising rate of return!
  6. Lol very true! And I completely agree with you. However years ago had I instead of investing in rbs shares, spent the same money "investing" on a new car, I would have lost a hell a lot less! I do also remember once a used car salesman trying to convince me that if i traded up to a newer car of more prestige branding, I was building up equity in my car and that you can then keep stepping up the ladder with each successive car change.
  7. This flat is up for sale, and it's going cheap for the area... £265k http://www.rightmove.co.uk/property-for-sale/property-26606772.html Hope no one buys it without googling the address first! Interestingly, I wonder how much of a discount someone would need in order to buy it. It seems the typical storyline for a horror movie - People unkowingly buying a haunted house because it was cheap... How much discount would someone need in order to buy a property with a bad past?.... --------------- f.y.i..... It's top floor flat of 23 Cranley Gardens... http://en.wikipedia.org/wiki/Dennis_Nilsen Killed 12 people before moving here, where he then killed 3 people in the flat. Storing them in bags in the flat... Only caught by police when neighbours reported a smell. No mention of that on rightmove or in estate agent literature though...
  8. If you don't mind ex-council hi-rise, you can pick something up around the Canada Water area for well under your budget.. For example this 2 bed with great views of London is on at what seems a reasonable 185k. Though of course given most ex-Council 2 beds fetch 250k and most non-ex-Council flats cost about 400k, you'll have to look closely yourself to see if there's any problems with this flat itself... http://www.rightmove.co.uk/property-for-sale/property-40520468.html I used to live around the area and it's a quick commute on the tube (about 15 mins to city and 5 mins Canary Wharf), Cycling to the city took about 15 mins. Edit: Just seen the catch... You need to have saved up the entire 185k in cash, assuming that no credit it available ... (And possibly some big reason why the banks won't lend against it). Then you're stuck with things like this at 250k:- http://www.rightmove.co.uk/property-for-sale/property-27746274.html or this at 200k:- http://www.rightmove.co.uk/property-for-sale/property-42064232.html
  9. That's the sort of idea I had in mind when I first moved to London over 10 years ago (taking a London pay premium). Oops on the last bit though!.... Has completely negated any of my original plans... So you're completely right!
  10. I completely agree. Though could you imagine trying to buy either a new car or a house with cash these days? - People would think you were a criminal....
  11. Exactly why quite a lot of geeky and academic types end up in the industry. Instead of working for 10 years doing something else, you can work for 3-5 years and do whatever you want for the remainder. Alternatively it's one of the very few ways you can afford to buy a nice house and be able to raise a family in Greater London without saving until you're about 40.
  12. Someone might try and claim that the salesman said: "'Interest Only' means you pay the interest only, as in you only have to pay the interest and nothing else each month...." Buyer: "Oh, that's so much cheaper than the other mortgages, what a great deal, I'll take it."
  13. I think your underestimating how stupid people can be. Have a read of this thread if you want some representation of 'normal' middle class family thoughts on mortgages.... http://www.mumsnet.com/Talk/legal_money_matters/a1672390-what-happens-when-a-mortgage-ends Extracts from the beginning of the thread... which hilight some of the lack of understanding, before other people join and break the bad news.... KatherineKrupnik Wed 30-Jan-13 14:20:15 Our mortgage was a 2 year mortgage that finishes in a couple of months. What happens?! Do we arrange a new mortgage to carry on seamlessly or are we expected to pay off what we owe in a lump sum...? (surely not) Presumably we will have to be assessed all over again, can't remember how long the process took last time, but how long should we allow for that so that we do have something in place? Thanks in advance. Message poster nipersvest Wed 30-Jan-13 14:22:42 once your current deal ends you just go automatically on to the svr (standard variable rate) offered by your mortgage company. you might want to check the % of interest rate against what you are on now to see how much your payments will change. you don't need to apply or be assessed for this to happen. you can get in touch with your lender and see what other deals they have to offer if you wanted. Message poster KatherineKrupnik Wed 30-Jan-13 14:23:50 No - our mortgage ends. It was a 2 year mortgage, not a 2 year mortgage rate. We have to re-mortgage. .... KatherineKrupnik Wed 30-Jan-13 14:29:03 Interest only mortgage. The duration of the mortgage was 2 years. KatherineKrupnik Wed 30-Jan-13 14:49:45 Because one of the mortgage holders retired in 2 years so they wouldn't give it for longer, but got better rates than doing it another way. We explored lots of options! .... CunfuddledAlways Wed 30-Jan-13 14:38:47 sorry i dont really understand? do you still owe money?? .... Message poster Viviennemary Wed 30-Jan-13 14:39:33 Sorry I understand now. Interest only. In that case I'm not sure. I apologise! .... fabulousathome Wed 30-Jan-13 14:53:34 So do you have the 70K to pay it off or do you need to get another mortgage? You will need to have your property valued again I would assume.
  14. As a previous thread discussed, although 100k sounds like a lot, many people on that would say it doesn't actually go all that far if you're living in London with a family. Which then further underlines that it must be so much worse for the majority of people who are on far less. (Particularly those who earn just above the threshold of any government help). £100K Isn't A Decent Salary For A Family In London If that's 10k a year without taking a single penny of tax credits or housing benefits, then that's very highly impressive going.
  15. Indeed, I view it as healthy thing because it makes me cautious about taking on big non-discretionary regular outgoings. In fact of the contractors I do know of, I'd say about 1/3 of them have stayed in the same job 3+ years, ie. longer than many permies have stayed in the same job. 2x the permie salary or a permie job on half the wage, and a safety net of potentially 3 months pay (or 1.5 months equivalent contract wage) if you become surplus to requirements... And as you say you become cautious of big outgoings, hence why most contractors I know of, even who are regularly in work tend to take bare minimum holidays, never take a day off sick and pay themselves ~3k a month (ie enough to live a shrewd living and low enough to avoid 40% tax, keep tax allowance, and minimise NI via dividends) whilst having several years worth of salary hoarded away in their company accounts for a rainy day. If these guys were permie on equivalent pay, they'd have no tax allowance, they would pay 50% (now 45% top rate of tax, and there would be no dividend payments to avoid NI, and don't forget expenses). Yes they may pay 150pm for an accountant, but the cost of that is tax deductable from their company's profits, and can give good advice on how to further 'optimise' company accounts such to tax advantage of tax breaks and loopholes which end up saving in tax more than they cost. Other thing which should give a clue about why contracting is a shrewd move is that it's widely made clear in the press that in many top public sector jobs, the civil servants are being paid through service companies (ie they are contractors!) to save tax...... Like others say, permie is a mugs game, you have no options over how you arrange to minimise your tax. I may preach about how good it is, but don't take my word for it, I'm a permie so what do I know?... Do as I say, not as I do
  16. I would agree with your statement, and depending on the exact industry and any specialist knowledge, could be higher (and of course also jobs paying less are around). Contractors are around double that and as other poster says, lacks job security and benefits. However to mitigate this, I know of some contractors who earn 140k+ (well their company does, thus validating your point) and hoard cash (100s of thousands) in their company accounts in order to build up a nice war chest in case of any lean periods so they can keep paying themselves their salaries (just below 40% tax threshold of course). These very people seem to be the ones who are always in employment though! I definitely think that via expenses, paying sub 40% threshold, contractors definitely pay less tax and eventually are better off net than a similar permie guy, who has no choice but to pay the full tax. But I can't be envious of contractors and their tax situation, afterall it's a free country and I or any other permie person could choose to run the risk and be a contractor if we so wish. (Though commenting on a previous post, personally I'd rather earn 100k as a contractor than 40k as a permie! unless the benefits bring it up to nearer 70/80k...)
  17. Taking the field you mention you do under the spotlight, the obvious example, a software developer contractor in London can expect somewhere around £500-700 per day (depending on any specialities and industry). If you assume you work 220 days per year that should get you 110k-150k per year. Of course you'd have to pay your employers NI etc out of that and other overheads of running a company. In fact I know of people working in London who fly back and forth from Ireland and Northern Ireland each week. So it's actually 'commutable' thanks to Ryan Air/Easy Jet. But once you factor in the cost of somewhere to stay during the week, trains from the airport, parking and car at airport the other end, it does eat away at the gains. And of course if you're contracting you also are rewarded for a risk premium of your work not being very stable.
  18. Haha, very true. And completely agree with you how people without family completely under-estimate. When I was single I never understood how people with family would spend so much on things which I thought were a waste of money. Now, I think most people just spend the money and have a quiet life, the few who don't somehow work a way put up with the constant 'reminder' of not having bought a new kitchen etc...
  19. In my first job I was earning around 15k a year, and after a few pay rises I was on about 20k. I was perfect happy, and felt well off... Until one day I was down the pub and one of the guys at work let out he was on 35k. Everyone was unhappy and eventually people started demanding and getting the 35k they felt they deserved. But like other people have said, it's down to your costs of living, along with what you feel you need to be content. I've been to places like Cambodia and people have virtually nothing yet seem happier than most people I know living and working in London! But I guess happiness would be a completely different thread of discussion!
  20. Don't get me wrong, 100k is, in absolute a good salary for living in London. I'm fairly sure when I was in my 20's and single, earning 45k, I had about 1.5k per month left over for discretionary spending (and I certainly spent more of it on partying and generally p***ing up it the wall than I do now!) and generally felt richer then than I do now. In no way did I say I felt poor, and I think if I did say that it would certainly be an insult to anyone with a family who is trying to get by with less. My point is that when I was single, I had fewer expenses and more left over on 45k than I would have on 100k with a family. I can see why anyone who has a family income of 100k and are moderate spenders (and not super scrimping) wouldn't feel as super well off as you would imagine someone with a 100k (which lets face it sounds like and IS a lot of money and an amount of money many people would only dream of) should be on the sound of it. And as you say, the trap of social comparison with the neighbours or other people who have more can certainly contribute towards the problem.
  21. If you have 12k a year left over AFTER the holidays and other lifestyle items, then you're definitely well off. If the 12k gets frittered away, then you're not quite as well off at the end of the year! I tried making my own sandwiches for a week, to save time, I made them all on the Sunday night, but I got a bit sick of ham and cheese sandwiches by Wednesday. I guess rather than a status thing, it's more of a case of variety of choosing what you want on the day, and also gets you outside the building once during the day. But seriously I wouldn't not make sandwiches as an indication of status. As you say from a status point of view just skip lunch and say it's either a diet or just say it's for wimps. Completely agree with your point about high cost of living. I think the point of the thread is that 100k gives the illusion you should be rich, but the reality is that most people earning that aren't after their costs are taken into account. (Even it it's because they tend to have higher lifestyle costs brought about due to expectation).
  22. When I first moved to London around 2000, I was on around 45k and bought a flat and lived a very good lifestyle. Though the different was: The house prices were a lot lower and I was a single guy. I could have lots of holidays wherever I wanted, and was running a nice car and never needed to have any second thought about money. Fastforward to 2013 and my monthly running costs are roughly:- Mortgage 1600 Council Tax 300 Travel Card 180 (one annual pass) Phone x2 20 (10pm each on contract) Utility Bills (elec, gas, water, tv licence) 400 Childcare 800 (childminder who can take flexible longer working hours) car 1 105 (insurance, tax, service, a puncture a year) - I had 3 last year! car 2 120 (insurance, tax, service, a replacement tyre) petrol 200 (one car used to commute, other car for occasional child pick up) Food etc 400 House maintenance 250 (Things break, pipe leak etc) Lunches etc for 2ppl 250 (Buy sandwich etc for lunch) Clothes/shoes for 3ppl 100 Child activities etc 50 -------------- Total approx 4775. If you factor in that a couple earning 60k/40k gets 5981 pm (Or a single income of 100k gets 5413 pm but less relevant since you prob would save 800 on childcare). Anyway at 5981 - 4775, that leaves 1206pm or about 14k per year after mundane things are deal with. Assuming you need 2k per year to put aside to spend on things crapping out big time (e.g. big car breakage, boiler busts). This means that in my situation 100k on a 60/40 split would leave 12k per year (or 1000 per month) to spend on other 'non-mundane' lifestyle things like:- - Going out and seeing friends for drinks and food - Buying Christmas presents, birthday presents, wedding presents and other such gifts - Family days out - Occasional Evenings out - Any other occasional treats - Holidays - Travelling to see family - New furniture - Buying toys etc for child - Buying toys and gadgets for me, eg a new computer - Replacing one of the cars something newer - overpaying the mortgage - savings - Private education for children (though probably wouldn't not be enough!) As you can see, with my expenditure (which I feel is relatively frugal compared to many others who may be trying to live on the suggested income bracket in the thread), 100k would not be breadline living, but it's hardly extravagant super rich luxury living with champagne and caviar every night. Of course if I had to survive on less you can cut back here and there, but like other people say, if you're factoring 100k per year income, you should hardly think that you should be forced into scrimping everywhere such as making sandwiches in order to make ends meet.
  23. Exactly, and also the prinpical here is that with housing benefit, WE, the taxpayers are paying for it, which is a bit different from a non-claimant, where THEY pay for it.... And as the other poster said, lodgers can be taken to use up the bedroom and contribute to the drop in the handout amount from the taxpayer...
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