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fru-gal

How Much Do You Think A 3 Bed Terrace House In Walthamstow Will Cost In...

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5 years? £700,000

10 years? £500,000

15 years? £300,000

all nominal values

Impossible to say in reality. If a dirty bomb goes off in London, then worthless.

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So you think they will rise in value in 5 years and then drop in values over the following 10? Why?

Edited by fru-gal

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No logic to the prices in Awesomestow like many outer London hotspots.

Take this average looking dwelling:

http://www.rightmove.co.uk/house-prices/detailMatching.html;jsessionid=767A91FEBA2480F71938646163CFD3A6?prop=46596089&sale=51733358&country=england

Sold for £610,000 in August – last sold for £150k in 2001.

So I would say

5 years £1m

10 years £3m

15 years £10m

Or alternatively - you couldn't pay me to live there. E11 is much nicer!

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So you think they will rise in value in 5 years and then drop in values over the following 10? Why?

Complete guess. I believed house prices were overvalued in 2009, and (in London) they have gone up and up. Until the monetary system resets they will probably still go up, but there could be many black swans in between. I don't believe they will go up forever.

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Couldn't care what it will be......I would never live there for any price....those that pay the price do so under their own free will, and those that lend them money deserve all that they get. ;)

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No logic to the prices in Awesomestow like many outer London hotspots.

Take this average looking dwelling:

http://www.rightmove.co.uk/house-prices/detailMatching.html;jsessionid=767A91FEBA2480F71938646163CFD3A6?prop=46596089&sale=51733358&country=england

Sold for £610,000 in August – last sold for £150k in 2001.

So I would say

5 years £1m

10 years £3m

15 years £10m

Or alternatively - you couldn't pay me to live there. E11 is much nicer!

I wouldn't say that E11 is that much nicely. There are nice bits of E11 and nice bits of E17.

My parents have just put their house, just around the corner from that one, up for sale. Not quite in the village but the price is still silly! As you say, there is no logic to Awesomestow (or much of the rest of the country for that matter)!

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How much do you think a basic 3 bed terrace (not new build) house in Walthamstow will cost to buy in:

5 years?

10 years?

15 years?

5 years - 30 years of net bankers take home salary + 10% deposit

10 years - 30 years of net bankers take home salary + 10% deposit

15 years - 30 years of net bankers take home salary + 10% deposit

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I wouldn't say that E11 is that much nicely. There are nice bits of E11 and nice bits of E17.

My parents have just put their house, just around the corner from that one, up for sale. Not quite in the village but the price is still silly! As you say, there is no logic to Awesomestow (or much of the rest of the country for that matter)!

Quite the contrary, the logic of Osborne's echo housing bubble is unambiguous. Just add £120-140bn to the national debt every year and watch asset prices soar.

There's nothing mysterious about it. Except, perhaps, why anyone would want to adopt it as govt policy.

Central%20gov.%20reciepts_5.png

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2ijknd.jpg

http://www.home.co.uk/guides/house_prices_report.htm?location=walthamstow&all=1

In the 90s crash the boom was essentially entirely reversed in real terms, with a small amount of leeway to account for the fact that official measures of inflation normally slightly underestimate: http://www.housepricecrash.co.uk/indices-nationwide-national-inflation.php

I'd therefore expect the chart above to run in reverse in real terms. The questions for me are when will the crash get fully underway? What speed will it run at? How much inflation will there be to take the edge off of the falls in nominal terms? And have there been any significant improvements to the local area that justify a real term value akin to pricier areas from the mid 90s, rather than a direct real term return to mid 90s prices in that locale?

Not sure on timing, I suspect it will take at least a decade if not more (look at Japan), but I make that an eventual market low somewhere around £110k +/- £10k for a semi in today's money (so likely more in nominal terms, dependent on inflation), which is about 5.4 x local median wages: http://data.london.gov.uk/datastore/package/average-income-tax-payers-borough

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Anything around Blackhorse Road is just a dump. There are parts that are quite picturesque such as the park next to the William Morris Museum and the old estate that borders that park (can't remember what it's called). The houses are nice. But it's one of those places where you don't hear any English spoken anymore (except by middle class old ladies visiting the gallery). It seems to be a very Polish and Turkish area now. Also lots of Somalis. The park is like a visit to the United Nations in the summer. Everyone gets on well (in the sense that they avoid each other lol).

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Guest The Relaxation Suite

2014: £650,000

2019: £725,000

2024: £795,000

2029: £875,000

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No logic to the prices in Awesomestow like many outer London hotspots.

Take this average looking dwelling:

http://www.rightmove.co.uk/house-prices/detailMatching.html;jsessionid=767A91FEBA2480F71938646163CFD3A6?prop=46596089&sale=51733358&country=england

Sold for £610,000 in August – last sold for £150k in 2001.

So I would say

5 years £1m

10 years £3m

15 years £10m

Or alternatively - you couldn't pay me to live there. E11 is much nicer!

46 photos!

That must be some sort of record

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Quite the contrary, the logic of Osborne's echo housing bubble is unambiguous. Just add £120-140bn to the national debt every year and watch asset prices soar.

There's nothing mysterious about it. Except, perhaps, why anyone would want to adopt it as govt policy.

Central%20gov.%20reciepts_5.png

So public sector debt has finally caught up with the private household debt of 1.4 trillion. Guess it needed debt from somewhere to keep the Ponzi alive, after seven years of nominal household debt stagnation. I guess in reality that 1.4 trillion is a whole lot bigger, not least the off balance sheet pension liabilities, State and public sector.

And we call this austerity.

Edited by crashmonitor

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Not sure on timing, I suspect it will take at least a decade if not more (look at Japan), but I make that an eventual market low somewhere around £110k +/- £10k for a semi in today's money (so likely more in nominal terms, dependent on inflation), which is about 5.4 x local median wages: http://data.london.gov.uk/datastore/package/average-income-tax-payers-borough

Those salary figures are misleading because they include part-time workers (most of whom are claiming Working Tax Credit anyway). The median salary of a full-time worker in London is £30k. Also due to feminism and unlike 50 years ago, most buyers outside the upper-middle class now structure their finances around a joint income, so youre looking at around £50-60k for a typical couple. Using your 5.4x median wages multiplier, that gives a price of £280-320k, which isnt far off what a 2-up-2-down in Walthamstow today, outside the village area.

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Actually its higher than I thought, the median full-time salary in London is acutally £34216

  • In April 2013 median gross weekly earnings for full-time employees were highest in London, at £658, and lowest in Northern Ireland, at £460.

http://www.ons.gov.uk/ons/rel/ashe/annual-survey-of-hours-and-earnings/2013-provisional-results/stb-ashe-statistical-bulletin-2013.html

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Actually its higher than I thought, the median full-time salary in London is acutally £34216

  • In April 2013 median gross weekly earnings for full-time employees were highest in London, at £658, and lowest in Northern Ireland, at £460.
http://www.ons.gov.uk/ons/rel/ashe/annual-survey-of-hours-and-earnings/2013-provisional-results/stb-ashe-statistical-bulletin-2013.html

And yet the average NI house price is probably a third of that in London.

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Those salary figures are misleading because they include part-time workers (most of whom are claiming Working Tax Credit anyway). The median salary of a full-time worker in London is £30k. Also due to feminism and unlike 50 years ago, most buyers outside the upper-middle class now structure their finances around a joint income, so youre looking at around £50-60k for a typical couple. Using your 5.4x median wages multiplier, that gives a price of £280-320k, which isnt far off what a 2-up-2-down in Walthamstow today, outside the village area.

The graph posted was for house prices across the whole of Walthamstow, not just the village.

I think your premise is misleading because it assumes that part-time workers are in a position to go full-time in order to buy a house, whereas in fact the full-time work might simply not be available for them all to do this, and childcare costs often mean that they would lose money even if it were. Additionally long run calculations of affordability are based on average income to house prices so only considering full time income from this point forward would give a misleading picture. The 5.4x multiple was an expression of what the outcome of my calculations were not a formula for what I thought the outcome should be; average prices actually dipped below 3x income in the 90s crash so even on your figures they could easily hit the £110k mark in real terms:

ftb-house-pirce-earnings.png

http://www.economicshelp.org/wp-content/uploads/2012/07/ftb-house-pirce-earnings.png

Feminism argued for equality and the sharing of childcare responsibilities, not the outsourcing of them to strangers in order to outbid each other with joint mortgages. The previous practice of 3x higher and 1x lower income (and there's no reason why women can't be the higher earners) was more sensible and lower risk, and I would not be surprised if it were to return in a crash proper given that risk is a much bigger consideration for banks when the prospect of negative equity looms.

Edit: given the income to house price graph posted above is for the average wages of first time buyers this ratio may well have dropped further than this in relation to average income, depending on whether or not we think that FTB incomes are likely to be in line with overall averages

Edited by Neverwhere

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Couldn't care what it will be......I would never live there for any price....those that pay the price do so under their own free will, and those that lend them money deserve all that they get. ;)

Nobody lends them money, banks give credit, i.e. they create the 'money' out of thin air thereby increasing the money supply which inflates prices for the rest of us so it does affect you too and therefore you should care.

After all these years on HPC you should really know this by now.

Edited by The Eagle

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Nobody lends them money, banks give credit, i.e. they create the 'money' out of thin air thereby increasing the money supply which inflates prices for the rest of us so it does affect you too and therefore you should care.

After all these years on HPC you should really know this by now.

I don't care what the prices are for places I have no interest in......I care that places others may have an interest in have been sold down the river with cheap credit from here, and imported credit from all over the world, QE gets everywhere......maybe they think if you work in London you don't have a dead-end job, what you earn today will double tomorrow, today's mortgage will one day pay for itself, will be peanuts in 25 years....the price of a cheese sandwich, frothy coffee and a packet of crisps. ;)

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