Just An Observation ...

[Who Knows]

I keep seing threads on the forum that state that houses are totally unafordable and couples would need x7 joint income based on average salary.

This does kind of ignore the following circumstances:

1. Many couples that each have decent jobs have a combined income of well over 80K. Even in my immediate circle of friends this is a conservative estimate.

2. Many people have made a considerable amount of cash in property over the last decade and have six figure sums to put down on their next property as a result.

Obviously this is not scientific and is largely based on personal knowledge of how people can still afford a home, yet it should still be considered when the blanket statement houses are out of everybodies reach is made.

Flame away ...

[Should you sell]

I agree, all of my friends (26-29 yrs old) have household incomes of between £70K - £120K, I do however realise that if a baby comes along then half of that could be taken away for a while but the point is still valid......

For 'me and mine' the average single salary is about £50K before year end bonus. I don't think that my group of friends are anything special, we all just quite lucky, hard working and in high paying industries I suppose.......

With this backdrop prices are not that stilly..... still not going to buy though

[Who Knows]

With this backdrop prices are not that stilly..... still not going to buy though

Neither will I, yet I do want to make the point that this site is getting increasingly selective in the information it choses to display and believe. I have posted anecdotals of places "selling" in Bristol and London within days and with numerous interested parties. It's not dead yet out there and family homes in particular with good shcools and transport access are still selling pretty well.

PS houses will not crash by 50%

[Time to raise the rents.]

Watch out WK, you'll turn bull if you aren't careful.....

[right_freds_dead]

comes to something when a landlord has to hang onto the IR so closley.

makes you wonder about the chaps sums. are they that close to the edge ?

surely as a professional, you would be able to swim in IRs up to 8%.

if not, you could be in deep do-do.

[Spring Bounce?????]

Lucky people.

My wife and I have joint salaries below the 40k mark although we have both been to college and university. We have both worked in the adult education sector which has recently and continues to suffer massive budget cuts and even worse contracts cancelled. My employer recently made eight tutors redundant due to contracts being cancelled without any warning.

Granted my wife is now part time due to our child commitment, but in sectors such as ours not only are the jobs disappearing the salaries are also falling.

How do we afford prices rising with salaries falling?

[Who Knows]

Watch out WK, you'll turn bull if you aren't careful.....

Not likely - though I am a "realistic bear" and think this will be a long and protracted affair (unless there is an economic shock that sends rates rocketing).

[Should you sell]

Spring Bounce I can only sympathise, as I said in my post luck and industry have a lot to do with salary!

My wife works for the NHS so I know what you mean about salaries falling etc!

Saying that though there is a lot more to life than money and I often feel quite embarresed about what I do for a living, there are times when I wish I was actually making a difference to somebodies life and not just making the rich richer (who can guess what I do!)!

Anyway somebody has to pay the bills!

[pdg]

I agree, all of my friends (26-29 yrs old) have household incomes of between £70K - £120K, I do however realise that if a baby comes along then half of that could be taken away for a while but the point is still valid......

For 'me and mine' the average single salary is about £50K before year end bonus. I don't think that my group of friends are anything special, we all just quite lucky, hard working and in high paying industries I suppose.......

With this backdrop prices are not that stilly..... still not going to buy though

Always a tremendous basis for studying macro-economics. "Me and my mates get paid well, doesnt the rest of the country? I dont know what everyone is grumbling about really."

Oh purlease! Whats the average wage in London? The Country? Not all of London for example works in the City, IT or whatever. Most earn 30K......work it out against average house prices and see the multiples Einstein!

[since the beginning]

I agree, all of my friends (26-29 yrs old) have household incomes of between £70K - £120K, I do however realise that if a baby comes along then half of that could be taken away for a while but the point is still valid......

For 'me and mine' the average single salary is about £50K before year end bonus. I don't think that my group of friends are anything special, we all just quite lucky, hard working and in high paying industries I suppose.......

With this backdrop prices are not that stilly..... still not going to buy though

I think it easy to extraplolate your own personal experiences and think the general poplulation is the same. 70k - 120k is no-where near normal. Your friends are either all in the same / or similar well paid industry or you are all of similar backgrounds. I would say 50k to a 100k joint income would be more average for my circle of friends and I would suggest that this is higher than the mode.

[Who Knows]

I think it easy to extraplolate your own personal experiences and think the general poplulation is the same. 70k - 120k is no-where near normal. Your friends are either all in the same / or similar well paid industry or you are all of similar backgrounds. I would say 50k to a 100k joint income would be more average for my circle of friends and I would suggest that this is higher than the mode.

Its also easy to say that a HPC will occur as property is "unafordable" without taking into account huge regional and even local variations in earnings and prices.

[Should you sell]

PDG

The post heading is 'Just an Observation' I was only saying what I know my friends are earning - I NEVER based MACRO ECONOMIC theories on it! All I was trying to say that for some people owning a house is reasonable at the moment....... I just don't think it is clever!

Now get back in you bad mood box!

[Spring Bounce?????]

Spring Bounce I can only sympathise, as I said in my post luck and industry have a lot to do with salary!

My wife works for the NHS so I know what you mean about salaries falling etc!

Saying that though there is a lot more to life than money and I often feel quite embarresed about what I do for a living, there are times when I wish I was actually making a difference to somebodies life and not just making the rich richer (who can guess what I do!)!

Anyway somebody has to pay the bills!

Thanks for the support.

I must admit I now continue in my work because I enjoy it. Lucky really for the government as we remove countless numbers of people from the dole queues and get them to return to employment. I think although the system isn't perfect we do a service to the country. Just a shame we have to work under the threat of joining the dole queues ourselves.

[IP Newcomer]

2. Many people have made a considerable amount of cash in property over the last decade and have six figure sums to put down on their next property as a result.

Serious question, do you think that the average salary and household income figures are wrong?

[mhifoe]

I agree, all of my friends (26-29 yrs old) have household incomes of between £70K - £120K, I do however realise that if a baby comes along then half of that could be taken away for a while but the point is still valid......

For 'me and mine' the average single salary is about £50K before year end bonus. I don't think that my group of friends are anything special, we all just quite lucky, hard working and in high paying industries I suppose.......

With this backdrop prices are not that stilly..... still not going to buy though

Try leaving your ivory tower for a second and considering where people work in the UK.

Around the country are places called 'shops' and 'supermarkets' which employ millions of people earning under £12k. Millions more work in factories and offices earning £15-20k.

Now if your argument is that housing is affordable because investment bankers and company directors can afford to buy dilapidated terraced houses in stabsville, please say so. It does not follow that because lots of people you know are loaded the rest of the population are.

[apom]

I keep seing threads on the forum that state that houses are totally unafordable and couples would need x7 joint income based on average salary.

This does kind of ignore the following circumstances:

1. Many couples that each have decent jobs have a combined income of well over 80K. Even in my immediate circle of friends this is a conservative estimate.

2. Many people have made a considerable amount of cash in property over the last decade and have six figure sums to put down on their next property as a result.

Obviously this is not scientific and is largely based on personal knowledge of how people can still afford a home, yet it should still be considered when the blanket statement houses are out of everybodies reach is made.

Flame away ...

How much???

Well in Devon I know qualified solicitors that would dream of that sort of money.. and our house prices areas high as anywhere and much higher then most.

My circle of friends.. all professional and mostly very early thirties..

I would say between £20,000 and £30,000

most low twenties, which is where I reside.. in a job that I am proud of and rightly so.

and the money made from property, is just equity and the jump to the next is bigger..

Trust me, in devon... Buyers are using massive multiples again interest only..

Don't worry about the capital...!!!

When the MPC is geared solely to keep inflation down.. Capital is all you should worry about.

Remember.. no one before us has paid of a mortgage as quickly as inflation did for them.. this is what has supported the ladder.

Low inflation meant that house prices should have dropped to reflect this.

That they didn't only means that they are paying too much for property.

You see.. there is a value against property.

To fit in to the economic ballence.. to be sustainable..

and currently they are too high...

the long term average (economically dictated and sustainable) price is 4 times average salary.

With low inflation that lowers that.

That is fact.

Edited November 11, 2005 by apom

[mhifoe]

Serious question, do you think that the average salary and household income figures are wrong?

Indeed.

My job as a footballer earns my £25,000pw.

Most of my friends earn £20,000-50,000 per week.

Therefore the average earnings in the UK are 25,000 per week, plenty to support current property prices.

[Should you sell]

Mhifoe

I NEVER SAID THAT WHAT I EARN IS AVERAGE.....

I am terribly sorry if my post offended some of you, it was never my intention.

I just thought I would add what my circle of friends are up too, obviously this is far to offensive!

[apom]

Lucky people.

My wife and I have joint salaries below the 40k mark although we have both been to college and university. We have both worked in the adult education sector which has recently and continues to suffer massive budget cuts and even worse contracts cancelled. My employer recently made eight tutors redundant due to contracts being cancelled without any warning.

Granted my wife is now part time due to our child commitment, but in sectors such as ours not only are the jobs disappearing the salaries are also falling.

How do we afford prices rising with salaries falling?

I agree, salaries are falling.

at first I just thought it was hard times due to the recession in IT and other industries.

(hiring more into the public sector and using debt to increase public spending does not mean that we have not been in a recession. We have been)

but I have seen many professional people taking lower salaries.. its a sign of the times..

Pay attention.. look around..

[marko]

I agree, all of my friends (26-29 yrs old) have household incomes of between £70K - £120K, I do however realise that if a baby comes along then half of that could be taken away for a while but the point is still valid......

For 'me and mine' the average single salary is about £50K before year end bonus. I don't think that my group of friends are anything special, we all just quite lucky, hard working and in high paying industries I suppose.......

With this backdrop prices are not that stilly..... still not going to buy though

Nothing special about you and your friends...I wouldn't agree with that.

I spent 8 years studying to Doctorate level in engineering and I get paid £30k a year. Hearing about these sorts of pay scales makes me sick...don't post it in future, I don't want to know.

[Lake]

However, if you consider the number of single-occupant households is on the rise, a single £40k or £50k salary isn't going to buy much of a home at the current prices.

Now, I'm waiting for the rant of singletons against couples who have double the income to put against housing. Surely, there must strong feelings on this subject? As strong as the die-hard bears feel against bulls and contrarians (such as London Landlady)?

Edited November 11, 2005 by Lake

[mhifoe]

Mhifoe

I NEVER SAID THAT WHAT I EARN IS AVERAGE.....

I am terribly sorry if my post offended some of you, it was never my intention.

I just thought I would add what my circle of friends are up too, obviously this is far to offensive!

The thing is, people with household incomes of £100k should not have to buy flats and terraces.

A £100k income should be enough to buy a great big house.

Not that long ago, people who worked in shops and factories were buying the houses that can now only be afforded by people on very high salaries.

Also, there are a lot of engineers on this website. We tend to be quite a bitter bunch.

[Who Knows]

How much???

Well in Devon I know qualified solicitors that would dream of that sort of money.. and our house prices areas high as anywhere and much higher then most.

My circle of friends.. all professional and mostly very early thirties..

I would say between £20,000 and £30,000

most low twenties, which is where I reside.. in a job that I am proud of and rightly so.

and the money made from property, is just equity and the jump to the next is bigger..

Trust me, in devon... Buyers are using massive multiples again interest only..

Don't worry about the capital...!!!

When the MPC is geared solely to keep inflation down.. Capital is all you should worry about.

Remember.. no one before us has paid of a mortgage as quickly as inflation did for them.. this is what has supported the ladder.

Low inflation meant that house prices should have dropped to reflect this.

That they didn't only means that they are paying too much for property.

You see.. there is a value against property.

To fit in to the economic ballence.. to be sustainable..

and currently they are too high...

the long term average (economically dictated and sustainable) price is 4 times average salary.

With low inflation that lowers that.

That is fact.

agreed - hence my post:

Its also easy to say that a HPC will occur as property is "unafordable" without taking into account huge regional and even local variations in earnings and prices.

I have recently moved to Bristol and taken a 12K pay cut for the same job. House prices are very silly compared to wages here and I believe there will need to be big reductions to balence things out. However I also think certain areas of Bristol will fare much better than others ...

[laughing_goat]

I keep seing threads on the forum that state that houses are totally unafordable and couples would need x7 joint income based on average salary.

This does kind of ignore the following circumstances:

1. Many couples that each have decent jobs have a combined income of well over 80K. Even in my immediate circle of friends this is a conservative estimate.

2. Many people have made a considerable amount of cash in property over the last decade and have six figure sums to put down on their next property as a result.

Obviously this is not scientific and is largely based on personal knowledge of how people can still afford a home, yet it should still be considered when the blanket statement houses are out of everybodies reach is made.

Flame away ...

Mine and Mr Goat household income is over 80K combined and we have deposit of over £100,000, yet we cannot afford a home big enough to bring up a family in. If you live in the South East you need much more money than this.

I do know people who have bought yet earn less than we do, but a £380,000 mortgage (yes, mortgage!) is taking things too far IMHO.

I also am aware I could buy an ex-local authority place (no comment required).

So, yes I could buy if I was desperate, but my god I can't ever see us being that desperate!

Another bitter Engineer!

Edited November 11, 2005 by laughing_goat

[Big_Head]

I keep seing threads on the forum that state that houses are totally unafordable and couples would need x7 joint income based on average salary.

This does kind of ignore the following circumstances:

1. Many couples that each have decent jobs have a combined income of well over 80K. Even in my immediate circle of friends this is a conservative estimate.

2. Many people have made a considerable amount of cash in property over the last decade and have six figure sums to put down on their next property as a result.

Obviously this is not scientific and is largely based on personal knowledge of how people can still afford a home, yet it should still be considered when the blanket statement houses are out of everybodies reach is made.

Flame away ...

Does anyone know if figures/graphs are available that show salaries against population. For example 60% earn 10-15K, 20% earn..... I am surprised by the salary figure's I sometimes see on this site, perhaps it is because I am badly informed therefore such a graph would enlighten me.

In any case I would be surprised if the percentage of people in this pay bracket is high, I would guess a low percentage. A graph as I described would indicate whether to use the term 'many' anyway.