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House Price Crash Forum


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Everything posted by jimjones

  1. No - he stole it from me :-( I'm not trolling.. just current societies over deserving attitude irks me..
  2. I know I'm being contentious here.. but 13k a year on child care? When exactly did it become your "right" to be able to afford to pay someone to bring up children you chosen to have? So if you're on average wage at 32k per annum, didn't have childcare costs (ie one parent stayed at home), cut your luxory items out (petrol, internet, mobiles etc) then you'd only be spending about 50% of your income on living expenses, which leaves plenty for food and some treats.... What I'm saying is welcome to the realworld.. 50% of the worlds population CAN'T afford adequote food on a weeks wage - yet your complaining about what exactly? that you don't have much money left for luxories? suprise - an average wage supports an average family without much left over... I think we've all got a bit too used to being spoilt.. it's not that everything has become too expensive.. it's just that we've got used to it being cheap- as a society, we all think we've arrived because we have good office jobs etc.. the reality is that all we've done is created a new "working class" - but we've been sailing on the high value of the pound for a long time.. Did your parents expect to bring up 2 children and have money to spare? a new tv every 2 years? foreign holidays etc.. That's what everyone expects now - why?
  3. I live just down the road from both renishaw sites... I've already spoken to 2 friends who are scared shitless about losing their jobs (both engineers/designers).. I know this is happening everywhere.. but it was only 6 months they were "bucking the trend" and showing record profits... The area where they are based, is small and they probably accounts for 50% of local employment.... On the other hand, house prices around here are massively above where they should be (even compared to 10 miles down the road), and prices haven't dropped off a lot - but I guess that will change... They've been told that those given the chop will recieve statatory redundency pay only... So if you need an army of electronic engineers I think they're will be a more than few available and cheap soon.... It's all very sad..
  4. I bought £5k of RBS at 11p and sold at 22p - which was all luck - but made me 5k! Unfortunately I'm about to lose the majority of the 1k I have in lloyds (which I "invested" out of the rbs money!)..
  5. Ermm.. that was kind of my point.... devilsadvocate: But if house prices are averaged at 160,000 then I'm not sure where you get 130,000 from.. So we look at the average house (which believe it or not currently has 1.5 wage earners living in it), at average salary (24k each) we get a combined household income of 36k... now 3.5x36k = 126k which is still 22% less than the current average house price of 160k... I imagine that when the average house price (for whats a 3 bed semi in a reasonable area) comes down to 126k most people on this site will be happy... Which will be 40% off peak, and where most here are predicting..
  6. nice work janube... But that's all tax payers.. as opposed to the ONS weekly earnings which is just fulltime employment, which might explain the difference...
  7. According to halifaxes own figures.. they suggest a mean in nov 2001 of 31k - so they have jumped 6k in last 4 recessionary/deflationary months!! http://www.dwp.gov.uk/asd/hbai/hbai2007/pd...full_hbai08.pdf Bizarely, the DWP seems to have different statistics again.. saying that median is more like 19k.... I'm wondering whether they do or don't non full time workers.. or whether the ONS data isn't annualised (ie it looks at a working week - and doesn't include holiday/leave, so rather than 500*52 it's more like 500*45).. even so.. something is a foot..
  8. Not according to that ONS article - the MEDIAN average male wage is current;y 27k! The median across men and women is 24k.. I've not idea what the mean is but I'd guess it is around the 32k mark, though it's less relavant.. I suspect the halifax use something like "the average salary of a male who we have given a mortgage to in the last 3 months" - so then it goes without saying that it's going to be on the high side.. One thing strikes me as strange looking at that ONS graph - if salaries are going up >5% every year, then how can inflation be hovering around 4%
  9. When you say "most people earn more than 30k" - you are very wrong.. According to the office of national statistics then the median (for full time workers) is aroun 27k.. So at least 50% of fulltime workers earn less than that.. They don't have a complete breakdown of statistics but I'd estimate that around 75% of people earn 30k or less..
  10. Whhhoooops.. just realised it was this statement you were picking up on.... It's actually very poorly worded, and I mean't that people weren't putting down knowingly false information of their forms and therefore weren't commiting any form of fraud.. My point being that these people should be mocked for their stupidity (and greed), but most weren't committing fraud or putting down false information on their forms.. better?
  11. Because I was never asked to put false information on a form to get a £180k mortgage. If I filled it all in geuinely (annual income etc etc), then in the box where is says "how much can you afford to pay each month" I wrote £1000 then I wouldn't of been lying.. I could afford to pay that at that time but if something went slightly pairshaped and my income dropped for a couple of months then I'd be screwed. I even pointed this out the broker who told me about "repayment holidays" and assured me I'd be fine.. I never took the mortgage because I figured it would be insane... but I'm not sure I'd call completing the form in that manner lying, a bit unrealistic maybe - but it's not lying.... The mortgage company should of flagged up that things would be a bit tight on £8k a year and therefore the mortgage was unaffordable... but because I would of been self cert, then they wouldn't bother with those checks - if I say "yeah should be ok" then that's fine in their opinion.. and with the mortgage broker standing over you convincing you that everything will be ok it's easy to get carried away....
  12. Bingo's replies are fair enough - no point in gloating and all that. I actually have sympathy for people in this kind of situation - we can't expect everyone to up on economic theory, and while it might of seemed obvious to us on here the general populous wouldn't of had a clue about the impending HPC, even those which did only though it terms of small drops - 10% maybe. Remember people were the fed the constant stream of "houses only ever go up", "the market might stagnate - but not crash, the fundamentsl are too strong", "Lowest interest rates in years", "housing shortage", "low rates of unemployment" and so on... But where I do have little sympathy for the original poster is that the crux of the problem isn't the HPC - she has fixed her mortgage so her mortgage hasn't gone up, she hasn't lost her job - so basically she made a commitment to pay a large sum of money which she could never afford to pay. That's more than a bit naive, it's not some horror story about interest rates flying out of control, or having to sell the flat because of a change circumstances.. Even without a HPC she would be in the same position as she is now (albeit she could sell the house) - she's simply taken on too much debt. And while I feel a bit of sympathy for her, taking on a mortgage that you can't afford to pay every month (when everything else remains the same) isn't naivity - it's irresponsible..
  13. Good work.. but you forgot to put "Liar Loans" in big red capitals.. Seriously though, a lot of people who took out the Liar loans weren't really lying, they were just taken in by the hype.. They didn't set out to lie on their mortgage contracts, they may bent the truth a little (and I realise that's a contentious point), or been talked into it by their mortgage advisors - I know that's what they tried with me. I was self-employed (geuinely) and every mortgage broker I spoke to talked in terms of any mortgage should be the maximum I was allowed, and as I would be self certifying then essentially the sky was the limit. If I could scrape together a grand a month they would happily lend me £190k as I had a 20k deposit - there was no lying involved, I just had to say "yes - I can pay that every month"... As I was only earning about £20k after tax at the time then it's easy to see that it wouldn't take much (a quiet couple of months for example) before I got behind in my payments.... Yes, I would of been foolish to take them up on the offer, but I don't think I would of been lying (but the mortgage advisers were certainly lying - to ME). My point being that these people should be mocked for their stupidity (and greed), but most weren't committing fraud by putting down false information on their forms..
  14. I think 3.5 because this is what banks are prepared to lend.. but this is where things get scary... We should be looking at household income - afterall the amount of purchasing power of people living in a house is based on the households income, so surely that makes more sense. In the 70's fewer women worked, and those which did earn't way less than their male counter parts. Whereas now, we're not far off equal, and most women do work... The average household in the 70's had 1 income the average household today has 2.. So to me we should be looking at around 3.5 * household income (that's what the mortgagers will look at!). I think average household income stands at around the £35k mark... so longterm real house prices should stablise at average of £153k (3.5*35 + 20% deposit) - of course we're bound to undershoot that for several months..
  15. Obviously I would of been better off buying a house (in hindsight) - but the strategy was sound..
  16. hahaha... Ok some of your posts haven't been too bad - but everything in this thread is just b0ll0cks!! If rent<mortgage interest and property doesn't always go up (it can't!) then renting is saving money... I've rented for the last 8 years, and saved almost enough to buy a house outright (my rent is less than the interest would be - so how does that make me a moron?) - and it will work out far cheaper than a mortgage especially if you factor out rampant hpi.. While you might be happy to pay into the profits of banks just to gamble at the casino property.. You've been very very lucky with you timming - anyone on an average wage under 25 hasn't been able to buy a house for 2 or 3 years - it's impossible.. You earn't your 400k then did you? no you've lucked out that's all.. I imagine you bouhgt your first house just before the last property crash (which for most was just blip) and all you've known is prices going up and up - you don't seem to be able to accept that prices won't and can't rise and rise.... Answer this, if the value of the houseing market dropped 50% overnight - who would suffer? I can't see anyone suffering except the downsizers, even those in NE will be ok if they hold onto their jobs.. HPI is bad for everyone except the banks... and erm morons..
  17. But that was it wasn't it... Once everyone had double income to spend on houses then the prices could take off, which then leads to the mad situation where you have to have more than double income to buy a house.. To the original posters question.... I guess if you're asking the question "has the growth trend of the housing market in the last 30 years given people a false view of the property market" then the answer is obviously yes.. I heard some old bag in a shop last year explaining that her son didn't want to buy a house because it was too expensive, she wanted him too because she had bought their house in the 70's and although in the beginnng the mortgage consumed her husbands entire wage and they struggled to make ends meet, 10 years later the mortgage was less than 2 days wages.. The problem is they look at the medium term and think it's the long term view - they can't think past their own experiences and they have never experience signicant property price drops - even in the early 90's the crash only affected the few who had just moved, anyone who had been in place for 2 or 3 years was sitting pretty, so the vast majority of people saw a few % off the value of their house, but it was only down to the previious years level and 95% of people didn't lose a penny and a few years later prices were back at peak.. So to most people the "big crash" of the 90's was an insigificant blip, which not only made people believe prices would keep on climbing forever, also made them think that a crash isn't bad and is over and forgotten about in a few months..
  18. How will people afford that? When there are over 700,000 homes available, very few homeless potential house buyers and the complete disappearnce of property speculation where exactly is this pent up demand comming from? I see interest rates of >10% to try control and economy if QE goes ahead..
  19. What you've noted here is not necessarily that food has gone up - but that unseasonal imported food has gone up - it's hardly suprising as cucumbers aren't in season anywhere in the world at the moment (they were a month or so ago).. So not only are they imported, they are importing a smaller supply - hence they cost more.. Though, I've not really seen anything dropping in price - I've seen lots of lower quality items going on sale at bargain bin prices.. Which poses the question, is it counted as deflation if prices stay the same, but everybody spends less by buying crappy food?
  20. What an odius comment.. 99.9% of the workforce earn less than what you consider basic pay - "which needs a bonus to topup", think about it that's more than 5x average salary.. The problem here is that banker have become accustomed to large amounts of money, mainly because of the party of the last 8 years.. So now their earnings have crept into massive figures - even those who were nothing to do with credit markets (the sector as a whole was booming).. I'm sure they argued previously, we made x million in profits so we deserve a slice of that.. now they are making a loss they are claiming "we can't possibly live on less" - well which is it? As for the argument that "many require the bonus or they'll go elsewhere" - let them go, I suspect most are just happy to have a job (there are thousands on umemployed bankers out there and the banks are shedding staff all over).. I've no problem with performance related pay - but once you start seeing the figures involved, and that it's hardly like they're in short supply, I start to think maybe some serious pay cuts are needed all round..
  21. It's the reason for that demand I was questioning... you could argue that houses were at record demand in 2007 - it's demand driven by speculation (and in the case of gold - as a currency hedge), once that speculation (and currency risk) goes the value is going to drop off a cliff. Yes - most gold bugs suggest that gold will infinitely increase in value.. Saying "look how well it's done, this graph shows it just keeps on climbing" is not an indication of it's future prospects.... I'm not saying gold wasn't a good investment - it's just that at the moment there is quite a risk that it's currently in a bubble so moving all your savings into gold may be exposing yourself to that market correction. I was meaning more the western economies, if US/UK/EU gets through the next 6 months unscathed - it's good bye to gold at £700 an ounce..
  22. Your point being what? That the gold market is booming? Surely that just goes to show either: a) the fundamental demand for gold as a raw material has grown the supply of gold has decreased c) The demand for gold as an asset has increased, through speculation and to offset the risks of fiat money. Personally, I don't see any evidence for the first 2, so that leaves the third.. So ask yourself these 2 questions: Why would gold continue to infinitely increase in value? What will happen when fiat money becomes more stable? I'll give you a clue - it can't, and will sink like a stone.. I think that when everyone is broke and fighting over bread, nobody will have the cash to buy into gold so the market price will drop... Even if only the UK currency bombs, I'd imagine that UK interests alone would be enough to clobber the global gold market..
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