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Advice From In-Laws - We Need To Move Somewhere Cheaper


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You maybe right I may have been unfair on the OP would have to know more about where he lives and house prices in the area around.

Cheltenham is about 10 miles from Gloucester. People will pay silly money to have a Cheltenham post code that's their choice I don't feel sorry for them.

What's the problem again? This is what people chose, sentenced younger generations to, with all their excuses from 2008 for buyers who had in the run up paid silly prices. "They didn't know what they were doing" and "Media made them buy" and "They just wanted a home" - remember? Now suck it up and admire your work - as my younger brothers and sister have to every day, and all their non-owning friends into the 30s. You've protected values for all the outright/equity rich older owners and the BTLers too.

Sunday Times 01.06.2014 (Home)

Smart Moves. - A London exodus is under way, as they gap between property prices in the capital and those in the commutable country hotspots widens.

.. One couple taking advantage of the price gap are ........ Shawn 40 and 43, whose £950,000 Wimbledon home sold within days. With their son .... 2, they are moving to a 5-bedroom period property in Shrewsbury, Shropshire, with a cinema, a double garage, and a garden that is "probably 10 times bigger," according to Shawn, a financial regulation consultant. ....... The math is simple. The average price of a four-bedroom property in London is £983,000, compared to £659,000 in Surrey or just £406,000 in Kent, according to Savills estate agency.

..Savills estate agency has seen a similar trend, with buyers from London moving to commuter-belt postcodes accounting for 26% of sales this year, compared with 21% for the same period in 2013. The shift in sentiment has even led the agency to start selling country properties from its London offices.

,..The exit route is also working its way further afield to Cheltenham, Bath and Bristo. ....... In Exeter, where a 4-bedroom semi can set you back about £400,000 Strutt & Parker reports that two out of every five viewings are by Londoners. Removal companies are also reporting a spike in London-outbound buyers heading beyond the commuter zone. "We've seen an increase in removals further afield, as homeowners cash in and make their money go further by moving down the M4 corridor to places in Gloucestershire, into Somerset and even as far as Cornwall," says Anthony Ward Thomas Removals. "The big moves we handle can take a week. We might take several days to pack up a six-storey house in Notting Hill or St.John's Wood and transport it to Somerset....."

..Another reason for the move out must be the sharp rise in London property prices and talk of a bubble in the capital........ As prices outside the capital creep up, the gap between capital and country will become narrower, which could ease the flow of Londoners wanting to relocate and cause the market to stabilise. ....... until then... the country market has the potential to outperform London over the next 12 months.

"As confidence in the market continues to improve, we expect that growing numbers of London dwellers will be unable to resist taking advantage of the value gap and will make the move out to the regions, says Sophie Chick, residential analyst at Savills, who predicts growth of 1% for the south and 3% for the Midlands and north, compared with negative chage of -1% for prime London over the next 12 months.

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Young people should be given back the right to build their own homes, like the previous generation did.

You see all those boomer houses and bunnglaows in the edge of the village and towns? They are only there because the law allowed them to build homes for themselves. This right has since been removed.

Really? I find that genuinely interesting. What law was that and who did the land belong to before it came up for auction I presume?

The problem OP has is that the south and south east is rammed with boomers that insist that every village, town and city in the south east where they reside is special and desirable.

Do they want the north south divide to have an extra layer of division?

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I'd be arguing for salary increases for young teachers.

Most people on here would appear to argue teachers are overpaid layabouts and voting UKIP will slash govt. spending and put an end to their largesse.

Daughter is a teacher, but chooses to live up North 'cause London/SE would give her a sh1t life, living in a sh1t flat, in a sh1t area spending most of her income in rent.

Life's about choices.

I'd be arguing for salary increases for young teachers.

Most people on here would appear to argue teachers are overpaid layabouts and voting UKIP will slash govt. spending and put an end to their largesse.

Daughter is a teacher, but chooses to live up North 'cause London/SE would give her a sh1t life, living in a sh1t flat, in a sh1t area spending most of her income in rent.

Life's about choices.

Surely that is an argument for regional variations in pay. Or more cheaper housing in London/SE. The amount that your daugher would need to buy to give her a decent home in London would in e.g. Hartlepool give her a mansion so she might still live up north.

For the OP I feel sorry for you. FWIW I would move all the pro single parents where you live to some cheaper so people like you have affordable housing and let people build more houses there.

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As it stands, what should be sensibly priced houses for us (3.5 x joint salary) are actually priced at 5x joint salary.

It's such a ready acceptance of the 3.5x joint income multiplier that has led to the 5x joint income multiplier.

People who want cheaper houses should not borrow more than 3 times main plus 1 times second income. When young people try to make a case with older people about houses being unaffordable now, the old should just say "Well you lot have been stupid enough to take on too much debt". It really is that simple. House prices would be tied to earnings again instead of tied only to what the banks can persuade people to borrow. Just say "No" and we have cheaper houses.

1998, 3 times main (£17k) plus 1 times second (£8k) = £59k average house

2014, 4.3 times joint (£25k + £15k) = £172k average house

1998 criteria to 2014 3 times main (£25k) plus 1 times second (£15k) = £90k average house

(Nobody bother with BTL argument because they wouldn't scoop them up, while due to the reduced borrowing, values would be falling)

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It's such a ready acceptance of the 3.5x joint income multiplier that has led to the 5x joint income multiplier.

People who want cheaper houses should not borrow more than 3 times main plus 1 times second income. When young people try to make a case with older people about houses being unaffordable now, the old should just say "Well you lot have been stupid enough to take on too much debt". It really is that simple. House prices would be tied to earnings again instead of tied only to what the banks can persuade people to borrow. Just say "No" and we have cheaper houses.

1998, 3 times main (£17k) plus 1 times second (£8k) = £59k average house

2014, 4.3 times joint (£25k + £15k) = £172k average house

1998 criteria to 2014 3 times main (£25k) plus 1 times second (£15k) = £90k average house

(Nobody bother with BTL argument because they wouldn't scoop them up, while due to the reduced borrowing, values would be falling)

I guess one way of calculating afforability is to take the average % of income it costs to buy an average house for a FTBer given the average wage of a FTBer household. Turns out the graph looks like this which shows the historic unaffordable level is more than 50% of your salary. Today on average the value is 32%.

The people who set Interest rates aren't idiots, they manage the situation carefully

NW-affordability-FTB-mortgage-take-pay.p

Edited by AteMoose
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I guess one way of calculating afforability is to take the average % of income it costs to buy an average house for a FTBer given the average wage of a FTBer household. Turns out the graph looks like this which shows the historic unaffordable level is more than 50% of your salary. Today on average the value is 32%.

The people who set Interest rates aren't idiots, they manage the situation carefully

NW-affordability-FTB-mortgage-take-pay.p

The "income" on that graph is whatever is put on the mortgage application. What it hides is the increased number of joint income mortgages. The second income used to be largely disposable particularly as the main income increased. Women had the choice to work for more disposable income or look after children. Now families are struggling, not because the gas bill as gone up 10p but because any second income is servicing debt. This is why banks say houses are 3 to 4 times income but prices are 6, 8 or 10.

1998 average wage £17k average house £59k = 3.47

2014 average wage £25k average house £170k = 6.8

It's because of higher multipliers of joint income mortages. Boomers are selling houses bought on single incomes to people using two incomes.

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The people who set Interest rates aren't idiots, they manage the situation carefully

If that's so, then why did they deliberately manage the percentage over 50% in 2008?

They could have regulated the dodgy mortgage lending or increased interest rates, but they chose not too?

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Sorry I agree with them. And if teachers shop workers and nurses can't afford to live there then the people who can afford to live there will have to commute to the areas where they live.

I sort of agree with them too, there are a lot of "undesirable" areas that have amazing houses and outside space. Maybe the solution is to buy in the bad areas on mass. A massive influx of young professionals would drive out the people who are making the area undesirable its a long game which would need nationwide coordination.

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By somewhere cheaper, are they suggesting you move to 1967?

Apart from time travel are they actually saying "just get on and have some children before we die"? Although them being at the other end of the country from them might be the arms length grandparenting they want.

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I'd be arguing for salary increases for young teachers.

Yeah, that'll bring down the costs of living and of runnig businesses.

It's inflation that put us in the sh1t in the first place. We need deflation

Typical Marxist commentary

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1998, 3 times main (£17k) plus 1 times second (£8k) = £59k average house

2014, 4.3 times joint (£25k + £15k) = £172k average house

1998 criteria to 2014 3 times main (£25k) plus 1 times second (£15k) = £90k average house

1998 wasn't too far from the bottom though. Be careful of treating that as any more normal than stupid peak prices.

Edited by Riedquat
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People who buy houses based on monthly 'affordability' are idiots.

For a 25-year mortgage, borrowing 100k at 7.5% is £739 a month. To borrow 200k and pay £739 a month, the interest rate has to be 0.8%. Which borrower is in a better position?

If the interest rate for the second buyer rises to 7.5% then they have to find £1498 every month to keep their house.

If the first buyer's rate doubles to 15% then they are still only paying £1281 a month.

Surely when normal people buy things they look at the price, not the interest rate? When I shop in the supermarket I buy cheaper options rather than more expensive ones. Borrowing 'as much as I can afford' sounds like opting in to a life trapped paying the mortgage above everything else, to me. Wage slavery.

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People who buy houses based on monthly 'affordability' are idiots.

For a 25-year mortgage, borrowing 100k at 7.5% is £739 a month. To borrow 200k and pay £739 a month, the interest rate has to be 0.8%. Which borrower is in a better position?

If the interest rate for the second buyer rises to 7.5% then they have to find £1498 every month to keep their house.

If the first buyer's rate doubles to 15% then they are still only paying £1281 a month.

Surely when normal people buy things they look at the price, not the interest rate? When I shop in the supermarket I buy cheaper options rather than more expensive ones. Borrowing 'as much as I can afford' sounds like opting in to a life trapped paying the mortgage above everything else, to me. Wage slavery.

I think buying now can still make sense but you have to spend quite a bit of time with a calculator. If you have to go with the H2B where you pay 5% then I don't think the figures will add up.

My guess would be if you were renting a house that was worth £100,000 rent = £500 per month £200,000=£750 pm £300,000 = £900 pm.

So it may be worth buying only at the bottom end of the market. With a life time tracker rate of 2.39% some houses in some areas do add up.

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1998 wasn't too far from the bottom though. Be careful of treating that as any more normal than stupid peak prices.

I'm treating it as "normal". I'm treating it as the year the Bank Act made the Bank of England "independent". Giving an unelected body more power than the politicians we elect. That was chocks away on house prices.

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I'm treating it as "normal". I'm treating it as the year the Bank Act made the Bank of England "independent". Giving an unelected body more power than the politicians we elect. That was chocks away on house prices.

Make no mistake, the bankrupt of england are going to play a very large hand in where this country ends up, and with no direct electroral responsibility whatsoever.

Think bankrupt banks, bank runs, fraud at every level of banking and at nearly every bank - libor rigging, fx rigging, falsification of mortage apps, malinvestment, general market rigging including the rigging of inerst rtes to push people into risky assets that the banks want off their books like mortgage backed securities.

Back in the real word as a result of over a deacde of manipulation, fraud and lies the industrical sector and those who work in it have been gutted.

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