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Belfast Boy

2010 Annual Survey Of Hours And Earnings.

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http://www.statistics.gov.uk/pdfdir/ashe1210.pdf

Page 9 for regional information.

Average income for Northern Ireland £440.80.

From the 2010 survey the annual income is now £22,921.60.

From the 2009 survey the average income was £22,833.20.

That is an increase of just £88.40.

So an increase 0.39%.

RPI inflation is currently running at 4.5%.

Edited by Belfast Boy

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http://www.statistics.gov.uk/pdfdir/ashe1210.pdf

Page 9 for regional information.

Average income for Northern Ireland £440.80.

From the 2010 survey the annual income is now £22,921.60.

From the 2009 survey the average income was £22,833.20.

That is an increase of just £88.40.

So an increase 0.39%.

RPI inflation is currently running at 4.5%.

Whether we believe these things is another thing.

But it is only in this forum that during the steepest recession in living memory the 'fact'that incomes have somehow held up and even managed to increase can be portrayed as a negative.

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4.11% less to spend on houses.

True, but only if people have kept spending their disposable income in the same way they were. I understanding they are not.

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True, but only if people have kept spending their disposable income in the same way they were. I understanding they are not.

It doesn't really matter what they spend it on. Their purchasing power just decreased.

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It doesn't really matter what they spend it on. Their purchasing power just decreased.

True, but only if they keep spending it. Evidence from retail sales, car sales, holiday sales would indicate they are not spending it. They are becoming more careful and therefore keeping more of their disposable income.

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Retail sales have picked up since last year. Car sales do continue to fall in the new car market. I would argue they are paying down debt. Paying down debt is not the same as saving a deposit for a house. It's just paying for some of the free credit that was thrown about for the last 10th years.

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Evidence from retail sales, car sales, holiday sales would indicate they are not spending it.

No evidence in the housing market? Do you still think the housing market has reached the bottom?

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Retail sales have picked up since last year. Car sales do continue to fall in the new car market. I would argue they are paying down debt. Paying down debt is not the same as saving a deposit for a house. It's just paying for some of the free credit that was thrown about for the last 10th years.

paying down debt is good, isn't it.

Your argumentation is although their income has increased the RPI has increased by more therefore the net result is they have less to spend on housing. The fact that housing has dropped by 40% should perhaps come into that same logic. Although we are told rents have increased.

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When were we told rents have increased? My argument is nothing. I'm just stating inflation has reduced our spending power. Not just housing but everything. Without pay increases at or greater that inflation we have just gotten poorer.

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No evidence in the housing market? Do you still think the housing market has reached the bottom?

There has been plenty of evidence of a massive decline in the property market and we discuss it almost daily.

I assume you are referring to what I said 18 months ago, namely that the new build sector, in particular was there or thereabouts the bottom, or words to that effect. I believed that the prices would bounce about for a further three years or more. Up and down. At the time the Nationwide price was at £136k, after falling roughly 40%. Since then it has bounced about, up and down and is now a further 3% lower at around £131k (total drop 43%).

So with 92% of the falls happening in the 18 months or so up to when I made that statement and only a further 8% drop in the 18 months or so since, I can claim that there has been considerable levelling from that point.

There will be further movement. Both up and down. I do believe, and have recently posted that the next moves will be downward, particularly over the winter.

What will the average house price be in 5, 10, or 15 years? Any prediction that turned out to be right would be shear guess work. If I take out a crystal ball, for what its worth I would guess that prices in 5 years time will be pretty similar to where we are today. In 10 years time (13.5 years from the crash it could be well on its way back to those figures (in monetary value) in 15 years it could actually be back at them (again in monetary value) and if Harrison is correct well on its way to the next up in real values. Of course that is all complete guess work but as good a guess as anyone else.

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When were we told rents have increased? My argument is nothing. I'm just stating inflation has reduced our spending power. Not just housing but everything. Without pay increases at or greater that inflation we have just gotten poorer.

On rents I am just going on what a number of posters here have put forward as their experience. There have also been a few reports posted on this. I have no real experience in the rental market and cant comment.

You say inflation has reduced our spending power in housing. Housing has fallen considerably more than inflation is rising. In fact, if these reports have been correct housing has been falling as our income actually has increased. Your 'increased' pay today can purchase almost twice the house it could a few years ago.

I agree our spending power on the weekly shopping basket (or however they calculate RPI) has become weaker. But not on housing. Our £ goes alot further than it did.

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On rents I am just going on what a number of posters here have put forward as their experience. There have also been a few reports posted on this. I have no real experience in the rental market and cant comment.

You say inflation has reduced our spending power in housing. Housing has fallen considerably more than inflation is rising. In fact, if these reports have been correct housing has been falling as our income actually has increased. Your 'increased' pay today can purchase almost twice the house it could a few years ago.

I agree our spending power on the weekly shopping basket (or however they calculate RPI) has become weaker. But not on housing. Our £ goes alot further than it did.

did any of the posters say rents had increased ?

if they did i must have missed it

what they did say if i recall correctly

that nice houses in nice areas at a reasonable price were letting quickly

which is a real shock not!

rock on!

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did any of the posters say rents had increased ?

if they did i must have missed it

what they did say if i recall correctly

that nice houses in nice areas at a reasonable price were letting quickly

which is a real shock not!

rock on!

Havant time to thrall through them all but here's a few...

I know that the sister in law and her husband were looking a house in Lisburn to rent. Both on minimum wage so most they couls afford was £450. Everything was gone...EAs kept saying they would need £550+. They have ended up in a 1 bed apartment in a real bad area and are paying £425 per month unfurnished...best they could get and its only guarented for 6 months. Seems rents in Lisburn are defo rising and nothing sits too long.

Been looking recently at apartments to rent in belfast area but can someone explian to me why rent is so high!?!

Everywhere i look it seems to be a minimum of £700-£800 for a 2 bed which i think is ridiculous! Not only are they expensive but the furnishing doesnt seem to be up to any high standard and couple that with only being allocated 1 parking space!

Is this due to speculators purchasing these apartments at such high prices that they need this high level of rent to cover their mortgages? Am i just behind the times and this is the normal rent price in belfast?

I have also looked at lisburn direction and they are looking £650 for apartments in thaxton village!

I cant see how these rent prices are sustainable! how do people afford this and have enough to live a life?

Average monthly wage after tax must be around £1200 (correct me if im wrong) so that is a third of someones wages to rent a room in a 2 bed apartment. That is ludicrous!

Anyone else out there feeling my pain?

You will see in my response, below, in that particular forum, that I wasn't particularly convinced that rents were rising. It would need to be assessed over a longer time frame. However I take the posts at face value. There was a report posted but it was only limited to the main rental areas of NI and seemed to exclude Fermanagh. There are other UK reports but, for me they are not particularly relevant to this region and were over too short of a time frame to indicate a definite trend.

There are currently 1,363 properties 'for rent', in the Belfast Area on PN.com. To me that would appear an oversupply. I will try to revisit this in a month or so to see if this figure is rising or falling. I cant imagine landlords would hold out for months and months for an unachievable rent.

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Whether we believe these things is another thing.

But it is only in this forum that during the steepest recession in living memory the 'fact'that incomes have somehow held up and even managed to increase can be portrayed as a negative.

Salaries cannot generally go down in the short term, that requires alot of unemployment and re-employment, therefore holding up is pretty negative in the face of everything else rising. I have always said that Salaries will not rise while everything else does, as companies use the recession to provide no increases.

House prices have pretty much held up too, all due to interference from gov't and dubious bank behaviour. If things where allowed to run their course house prices would be alot lower as would salaries.

Edited by Ride_on

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Salaries cannot generally go down in the short term, that requires alot of unemployment and re-employment, therefore holding up is pretty negative in the face of everything else rising. I have always said that Salaries will not rise while everything else does, as companies use the recession to provide no increases.

House prices have pretty much held up too, all due to interference from gov't and dubious bank behaviour. If things where allowed to run their course house prices would be alot lower as would salaries.

We will have to agree to differ on this. An unprecedented fall of 45% can hardly be described as 'pretty much holding up'. The dubious behaviour from the banks and Government was the liar loans and the deregulation that happened prior to the crash. Whilst the 'battening down of the hatches' that they have done since is a little 'after the horse has bolted'it was certainly not aimed at increasing the flow of credit.

Not everybody is on a contracted Salary. I agree with you it is difficult to trim these and the best you can do is freeze them. However I expected this combined with the pay and hourly cuts on those not on protected pay to pull the average down. I was surprised to see it holding and even slightly increasing. I don't agree with your statement that 'Salaries will not rise while everything else does'. When everything else rises (inflation) Salaries will jump with them.

From where I stand. Salaried holding up and even increasing while property has deflated by 45% is very positive. We have always talked about the problems of pay increases not keeping up with property increases. This is why the Nationwides ratio for FTB'ers house prices to FTB'er Income fell from almost 8 to almost 3.5. You may argue that 35 or 4 is not low enough and thats fine. But you have to acknowledge the massive shift there has been, not only in the whole UK but in our position within it.

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did any of the posters say rents had increased ?

if they did i must have missed it

what they did say if i recall correctly

that nice houses in nice areas at a reasonable price were letting quickly

which is a real shock not!

rock on!

For those interested in the data

http://www.propertynews.com/blog/951/Performance-of-the-Rental-Market-in-Northern-Ireland:--January-%EF%BF%BD-June-2010

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We have always talked about the problems of pay increases not keeping up with property increases. This is why the Nationwides ratio for FTB'ers house prices to FTB'er Income fell from almost 8 to almost 3.5. You may argue that 3.5 or 4 is not low enough and thats fine.

I am not arguing. I am just looking at the facts. Historically speaking the FTB to earnings ratio is still high when compared to the previous bottom for the housing market. For 5 years between 1992 and 1997 the ratio was below 2.5. You are the one arguing that a ratio of 3.5 to 4 is affordable. You are the one arguing against history. In the next 4 years we will see if you are right.

Remember this quote from VedantaTrader, "The mistake I think lots of people are making, is that they are assuming the real estate market, in a few years time, will exist in the same economic conditons that exist today."

Everyone can see that economic conditions are changing. You are perhaps the only person here who thinks that the economic changes we are seeing will not cause house prices to fall. It is a credit to you that you are still here arguing your position.

Edited by Belfast Boy

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We will have to agree to differ on this. An unprecedented fall of 45% can hardly be described as 'pretty much holding up'. The dubious behaviour from the banks and Government was the liar loans and the deregulation that happened prior to the crash. Whilst the 'battening down of the hatches' that they have done since is a little 'after the horse has bolted'it was certainly not aimed at increasing the flow of credit.

Not everybody is on a contracted Salary. I agree with you it is difficult to trim these and the best you can do is freeze them. However I expected this combined with the pay and hourly cuts on those not on protected pay to pull the average down. I was surprised to see it holding and even slightly increasing. I don't agree with your statement that 'Salaries will not rise while everything else does'. When everything else rises (inflation) Salaries will jump with them.

From where I stand. Salaried holding up and even increasing while property has deflated by 45% is very positive. We have always talked about the problems of pay increases not keeping up with property increases. This is why the Nationwides ratio for FTB'ers house prices to FTB'er Income fell from almost 8 to almost 3.5. You may argue that 35 or 4 is not low enough and thats fine. But you have to acknowledge the massive shift there has been, not only in the whole UK but in our position within it.

Well to me, the 40% drop is over and done with it happened over a year ago, I meant houses have held up since then when they should have dropped further.

The dubious behaviour I am talking about is the banks not foreclosing on defaulters (at gov't request) and repossessing houses and holding reserve prices high at auction, and holding interest rates artificially low, all to protect house prices and pretend banks are not insolvent. There are alot of people out there with unaffordable mortgages, they should have defaulted by now and a firesale resulted, but it didn't happen because of the 'dubious' behaviour.

Well I guess in the construction industry alot of people are contracted short term, but I had thought most people in the country are on permanent contracts (salaries) that cannot be reduced without the employee's agreement. I didn't expect the short term contracts to have a significant effect, but I must admit I don't know the mix. I have experience of the permanent contracts and can say quite categorically that companies will use the excuse to limit pay increases. I have lived through double digit inflation (early 90s) and my salary did go up proportionately(ish), but always lower than inflation. The economy was growing then with alot of value add, it isn't now. Employers in competitive industries pretty much try to get away with as low increases as possible, at the moment most people are concerned about job security they are going to have less energy to fight for RPI level increases. IMO employers offering big money to 'talented' individuals are not competitive by definition.

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Well to me, the 40% drop is over and done with it happened over a year ago, I meant houses have held up since then when they should have dropped further.

The dubious behaviour I am talking about is the banks not foreclosing on defaulters (at gov't request) and repossessing houses and holding reserve prices high at auction, and holding interest rates artificially low, all to protect house prices and pretend banks are not insolvent. There are alot of people out there with unaffordable mortgages, they should have defaulted by now and a firesale resulted, but it didn't happen because of the 'dubious' behaviour.

Well I guess in the construction industry alot of people are contracted short term, but I had thought most people in the country are on permanent contracts (salaries) that cannot be reduced without the employee's agreement. I didn't expect the short term contracts to have a significant effect, but I must admit I don't know the mix. I have experience of the permanent contracts and can say quite categorically that companies will use the excuse to limit pay increases. I have lived through double digit inflation (early 90s) and my salary did go up proportionately(ish), but always lower than inflation. The economy was growing then with alot of value add, it isn't now. Employers in competitive industries pretty much try to get away with as low increases as possible, at the moment most people are concerned about job security they are going to have less energy to fight for RPI level increases. IMO employers offering big money to 'talented' individuals are not competitive by definition.

Bank rates artificial low gets me. The BoI may be historically low but also irrelevant any more. Try getting a mortgage fixed at anything close to that. Most 3 and five year fixes are 4 to 5.5%. Pretty much the historical average for the last 15 years. The big difference is you now need a good loan to value ratio to avail of these rates. If you mortgage is anywhere close to market value for your property you will be paying alot more.

There are plenty or repo's on the market at the moment. The banks learnt in the early 90's that fire sales were not in their own interest. The banks will look after their own interest no matter what the government tells them. The largest 'dumper' of repo's on the market was reported to be Northern Rock.

I am surprised as anybody to see the reports stating that there actually was a reported pay increase in the current climate. In my first post I even asked if we should actually believe this. And I am well aware of the pressures out there constraining pay increases. However in an inflationary economy wages are forced up.

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  • 284 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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