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  1. As per Economist the most appropriate position for Banks to lend is when House Price to Income Ratio is 3.5 Currently in UK its hovering around 7.5 !!! https://www.theguardian.com/money/2017/mar/17/average-house-price-times-annual-salary-official-figures-ons BUT for the majority of 21 to 35 year olds (largest first time home buying segment) its hovering around 10 for most of the UK, except around 15 for Greater London. This is mainly due to non availability of well paid jobs to young professionals. I know this because I live in London and most 21 to 35 year olds I know make between 25K and 40K, While House prices hover between 400K and 700K in Suburban London from Travel Zone 4 outwards (Zones 1-3 are mostly out of reach unless you are Rich). I know people who are 35, living with their parents and still struggling to save for a Deposit. Seems like a very Risky position for Banks to continue lending when someone owes 15 times their Gross Income, which is essentially 20 times their Net Income. A small economic shock can lead to large number of Defaults, not a good position for Lenders considering uncertainty around Brexit. New Buyers are Lifeblood to keep this Bubble alive, without a continuous Injection of New Buyers the cycle would collapse (or inflate in the wrong direction when BTL sharks take control of the cycle) My opinion is that Bankers are not asleep at the wheel but will intentionally continue to Lend knowing the Risks to keep this Bubble alive to its seams as Fat Cats get big bonuses when they sell more mortgage products (later they know Government will have to come and rescue them from Taxpayers Money) Your Thoughts, Opinions ?
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