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Trampa501

Have We Got It Wrong Regarding Hpc?

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I have re-run this with £200 per month for gas, electric, phone, broadband and £100 for loan repayment. The loan available is identical. Are you interested in buying?

No thanks - you can aquire wealth like the rest of us: Save and invest it. Im not giving it to you in the form or over exagerated equity.

Incidentally my maximum mortgage comes out at near 900k but Im still not going to buy.

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This is a very interesting thread, just looking through some figures now, and yeah, based on local evidence it doesn't seem like there's any signs of a HPC coming here, in fact it actually seems to have stabilised!

I currently live with my parents but am considering buying a house, I know there are countless fantastic resources scattered over this site and the forum, but is there one piece of reading anyone would recommend that could help me reconsider my decision?

Thanks :)

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I have re-run this with £200 per month for gas, electric, phone, broadband and £100 for loan repayment. The loan available is identical. Are you interested in buying?

Still not that real world; less 3-4% salary for student loan, mobile phone, skychavTV, store cards, credit cards, (ok £100 loan for motor but that is low), petrol, car insurance, contents insurance, possibly child care, council tax et al

Ask that last question in 2 years time after we have had a year of post general election reality. At the moment we are just treading water not wanting to look down into the murky depths to what lingers below and awaits us.

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A quick look in the top right of the screen shows average prices below £160k.

HSBC's mortgage calculator shows the following:

If a couple earn jointly £45k (25 + 20), they can borrow £157k on a property costing £177k (above average).

The current monthly payment is £881 over 25 years.

What is unsustainable about this?

Mr P - whats the interest rate assumption in your calculator?

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This is a very interesting thread, just looking through some figures now, and yeah, based on local evidence it doesn't seem like there's any signs of a HPC coming here, in fact it actually seems to have stabilised!

I currently live with my parents but am considering buying a house, I know there are countless fantastic resources scattered over this site and the forum, but is there one piece of reading anyone would recommend that could help me reconsider my decision?

Thanks :)

Good first post.

:rolleyes:

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yes, £881 on a tracker, so thats variable, add the £999 booking fee, and the 20K deposit, 3K buying costs.

course thats over 6 times main earners salary £25K or £1597 per month when the wife has a sprog.

OK 1600 - council tax of £180, travel £50, heat and light £100, and food say £300, repairs and renewals say £100, phone £50

leaves £920.

thats £40 to buy nappies, redecorate, clothes, washing and everything else

and this is with rates at RECORD LOWS...its only up from here.

now convince us of the sense of a 6 times salary mortgage.

No sense at all. If they don't both work, they can't afford the property. They could not afford to rent it either. I know very few couples with children where only dad goes out to work.

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This is a very interesting thread, just looking through some figures now, and yeah, based on local evidence it doesn't seem like there's any signs of a HPC coming here, in fact it actually seems to have stabilised!

I currently live with my parents but am considering buying a house, I know there are countless fantastic resources scattered over this site and the forum, but is there one piece of reading anyone would recommend that could help me reconsider my decision?

Thanks :)

Please get property bee installed on your PC - gives the history of property on rightmove highlighting detail and price changes. You will have to install firefox internet browser to use it but it is priceless.

Save all the money you can and wait for 18-24 months. It is not like prices are going to rush up but there are numerous reasons why they will continue downwards.

Oh and don't take the mainstream media's word that the market has bottomed out - as other, older and wiser posters here will tell you there were numerous false dawns through the last crash.

If you cannot stand living at home get a rental - you can have landlords over a barrel at the moment.

http://www.property-bee.com/

http://www.mozilla-europe.org/en/firefox/

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That's an awesome post, thanks so much BNW! I do actually have Property Bee, it's fantastic at giving you an overview of each houses history, and probably gives some nice ideas on whether or not it's viable to haggle them down a bit or not :)

I think I'll continue to look, just in case somewhere I really like comes up for a decent price, see if I can haggle them down a little bit, and if not? No worries, I'll just carry on waiting! I'm in no rush really, but wouldn't mind moving out I guess.

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2 yr tracker at 4.59%. Who does the 25yr fix and what is their rate?

You just gave an answer to where is a serious problem in your assumptions (or inability to see risk). Northern Rock went t1ts up exactly because of this attitude: they coulnd't roll their financing at all or at a rate they had imagined. You are a kamikaze if you plan to roll your liabilities like this every 2 years if you are 90% leveraged. It's madness. You haven't understood and learnt anything from the past 2 years. Ignorance? Now, go and try to fix the rate for 5 or 10y, it will defo shoot up. 30y can be done, not sure if at retail level and if for everyone.

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No sense at all. If they don't both work, they can't afford the property. They could not afford to rent it either. I know very few couples with children where only dad goes out to work.

well, £170K 3 bedders here rent for 600-700.

and they dont need £25K savings.

clearly, if a couple cant have a child and afford an average home the market is wrong...skewed by something rhyming with shanks.

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That's an awesome post, thanks so much BNW! I do actually have Property Bee, it's fantastic at giving you an overview of each houses history, and probably gives some nice ideas on whether or not it's viable to haggle them down a bit or not :)

I think I'll continue to look, just in case somewhere I really like comes up for a decent price, see if I can haggle them down a little bit, and if not? No worries, I'll just carry on waiting! I'm in no rush really, but wouldn't mind moving out I guess.

no probs.

Some good reading:

http://www.marketoracle.co.uk/Topic7.html

Good general reading.

http://www.moneyweek.com/investments/prope...erty-14784.aspx

Interesting article from the femme fatale of HPC. co.uk

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A couple who both have to work for a minimum of 25 years each, just to pay off a mortgage, assuming they both maintain that salary, remain in good health for 25 years, neither lose a job, dies or leaves.

Children who are brought up by nurseries and after school clubs rather than by their own parents because both are stuck at work, desperate to hold on to pay that crippling mortgage. (Let's just hope they don't both have stressful jobs... it was bad enough when your dad came home with a temper some nights... now how about your mum too... )

A family unit over burdened or ripped apart by debt. A society of feral youths and despondent teenagers. A cost of living that requires both parents to be in full time employment just to pay the bills, buy food and keep a roof over their children's heads.

Where will it end? Bigamy to become lawful because just 2 household incomes isn't enough? 12 year olds are permitted to work 16 hour weeks? Poorer families are discouraged from sending their 18 year olds to University (if they aren't already) because that extra household income really would come in handy.

What is unsustainable about this?

I nominate this ChesterCopperpot post as the most cheerless of the day. I get the impression that he actually thinks these things.

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I nominate this ChesterCopperpot post as the most cheerless of the day. I get the impression that he actually thinks these things.

I nominate Mr Punter as the most short sighted of the day. I get the impression he actually believes these things

;)

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No sense at all. If they don't both work, they can't afford the property. They could not afford to rent it either. I know very few couples with children where only dad goes out to work.

This is exactly our point. To assert that mortgage payments (and/or rents) are a good thing when they force both parents into that which amounts to little more than slavery is precisely why the HPI sh1t is such a problem!

Because someone says that house prices never go down (and the sheople believe them!) and/or the Bovey-esque attitude of "freeing people up" from any individual effort or responsibility has people running around like idiots looking for pots at end of rainbows. Look where that got him! He has only been allowed to keep what he has (stolen?) because the law - as executed in his case - has been hamstrung and handcuffed by thin veneers of PLC directorship.

HPI-sheople who naively believe the 'get rich because I am special because I am born with some contrived 'privilege'' need a good wake up. When the balance of them wake up and realise their emperor is, indeed, not wearing any clothes at all they will climb down off 'money for nothing' the bandwagon.

On that point: where is Bovey buying clothes these days anyway?

A thesis (for testing!) about house prices: when rent falls house prices follow? And rents have sunk ... and are still sinking.

What sort of reasonable commitment is to be made to the people around them (family) or sell your children's future for the (perceived!) value through an inflated asset price? Surely your children are worth more to a real person than the get rich quick scheme that is the lie of Liar Loans and the farce of people enslaving themselves to unsustainable mortgage payments?

Aidanapword

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give it a few years, the gov is going to have to tackle the deficit which means sacking lots of public sector workers. that should bring further falls but property is illiquid and it can take time to re-adjust

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No sense at all. If they don't both work, they can't afford the property. They could not afford to rent it either. I know very few couples with children where only dad goes out to work.

Therein lies the con. Dual earnings increased credit availabilty and started pumping HPI. The effect is that it now takes two to afford what one could previously.

If there are two earners, the household should enjoy a very good standard of working-class living. Couples who have fallen for this banking/government scam have done irrepairable damage to their children and their children's children.

p-o-p

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Therein lies the con. Dual earnings increased credit availabilty and started pumping HPI. The effect is that it now takes two to afford what one could previously.

If there are two earners, the household should enjoy a very good standard of working-class living. Couples who have fallen for this banking/government scam have done irrepairable damage to their children and their children's children.

p-o-p

bit like supping on mercury cakes.

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Therein lies the con. Dual earnings increased credit availabilty and started pumping HPI. The effect is that it now takes two to afford what one could previously.

If there are two earners, the household should enjoy a very good standard of working-class living. Couples who have fallen for this banking/government scam have done irrepairable damage to their children and their children's children.

p-o-p

Is it a scam? I don't like it, but it seems pretty inevitable that if you increase the amount of money available (via both mum and dad working), then the price of the desired asset will rise, unless the asset is over-stocked.

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Is it a scam? I don't like it, but it seems pretty inevitable that if you increase the amount of money available (via both mum and dad working), then the price of the desired asset will rise, unless the asset is over-stocked.

Not money, the amount of credit upon which interest is payable!

p-o-p

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Well i don't have the data and i don't know who Hamish is.

Just conceptually doesn't seem right to me. I guess if all houses were for sale and everybody went to buy then yes the average salary wouuld buy the average house. But thats not the case as many already own houses. Will give it more thought rather than make up a theory on the spot :)

With respect you are missing the point. No-one is saying the average salary should buy the average house. What is fact however that long term there is a relationship between average salary and average house price - if you plot them both on a graph you will see that the long term trend is between 3 and 4. That doesn't mean 3 to 4 times the average salary buys the average house - it means that this is a level at which the market works at. At the moment the figure is 6, which is way above the long term average. When we see this figure dropping under 4 then we'll have a healthy housing market again.

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I'm also still waiting for Bateman to explain what relation the base rate has to the average mortgage rate offered by a high-street bank.

Depends on when you took out your mortgage - mine is tied to it as are tracker deals that are avaliable now.

I don't know what the average mortgage deal looks like - from what I read on here it is x200 salary and interest only at 1000%

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Okay, so there's been a correction, but house prices seem fairly stable (even rising) in a lot of areas, and the claim in many countries is that the recession is over. Is that it? Are house prices going to stay historically high? Will we have to adjust to 40 year mortgages, higher taxes etc etc ?

No.

This question was being asked in 1988/1989 too, look what happened.

Also Japan went down the route of the 50 year mortgage in the early 90s - again, look what happened.

Don't be suckered in. It's never 'different this time'.

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Is it a scam? I don't like it, but it seems pretty inevitable that if you increase the amount of money available (via both mum and dad working), then the price of the desired asset will rise, unless the asset is over-stocked.

In some ways it is 'simply' a false dawn sold to people that buying a more expensive house is the way to add value into your lifestyle (requires the myth that MEW is a good idea for this to be logical (if silly)?).

Then there's the 'money for nothing brigade' and Liar Loans and more besides.

So, yes, mum & dad both work ... but the (individual) short sightedness of not thinking through the enslavement to a 25 year mortgage (or longer when Interest Only?) is quite tragic.

Aidanapword

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No thanks - you can aquire wealth like the rest of us: Save and invest it. Im not giving it to you in the form or over exagerated equity.

Incidentally my maximum mortgage comes out at near 900k but Im still not going to buy.

£900k but can't spell "acquire"? Let me guess.. Are you an IT geek?

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  • 333 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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