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£130K Combined Income, No Chance Of Buying In London

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Radio 4

0730

This morning the programme looks at housing as an election issue. John Humphrys starts his report in his local area in west London.

Jump straight to 1hr 33min

http://www.bbc.co.uk/programmes/b05r0b2v

28 days to listen.

One of the problems is foreign money looking for a parking spot.

Therefore, I think primarily halting immigration won't stop this process (although it should be controlled better). Nor will building more, as the wall of money is huge. A multi-millionaire or billionaire who owns factories in the East can buy with cash, whereas people here buy on debt and have trouble saving for a deposit. Bigger loans at lower rates won't compete with cash buyers - they could always just leverage up.

Stop foreign money? Hmm no political party will stop that either. Only when there is a better investment than London property, will global capital move on.

Edited by 200p

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Thanks for linking that, I left this morning about the time they were discussing the Little Grebe attacking rabbits at 6 o'clock.

Rent aside, wouldn't have thought an 80k deposit would have taken that long to save up for...they've been at it ten years.

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It was aired on Monday, but I usually have a sticky notepad and a pen in the car to jot the time down.

Can't sequence when I heard something obviously (ie. the grebes, but did leave at 6 this morning too).

As for my prevous point. Does seem odd that a couple earning that kind of money can't put aside 80k in the timeframe they have been saving. Guess London must be a very expensive place to live.

So it comes down to bank of Mum and Dad and a birth lottery.

Edited by crashmonitor

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Radio 4

0730

This morning the programme looks at housing as an election issue. John Humphrys starts his report in his local area in west London.

Jump straight to 1hr 33min

http://www.bbc.co.uk/programmes/b05r0b2v

28 days to listen.

One of the problems is foreign money looking for a parking spot.

Therefore, I think primarily halting immigration won't stop this process (although it should be controlled better). Nor will building more, as the wall of money is huge. A multi-millionaire or billionaire who owns factories in the East can buy with cash, whereas people here buy on debt and have trouble saving for a deposit. Bigger loans at lower rates won't compete with cash buyers - they could always just leverage up.

Stop foreign money? Hmm no political party will stop that either. Only when there is a better investment than London property, will global capital move on.

That is why we need the Mansion tax and ending Non-Dom status. Plus the coalition did bring in a few things to make high end housing unattractive such as raising the SDLT charges, introducing SDLT for properties bought through companies, ATED, CGT for foreign owners etc. It is slowly becoming less attractive to park money in London.

A buyer of a £2 million pound house will now have to pay £153.750 in stamp duty or £300,000 if bought via a company.

Edited by fru-gal

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That is why we need the Mansion tax and ending Non-Dom status. Plus the coalition did bring in a few things to make high end housing unattractive such as raising the SDLT charges, introducing SDLT for properties bought through companies, ATED, CGT for foreign owners etc. It is slowly becoming less attractive to park money in London.

Hmm true - however I think we're probing in the dark here. Even after these measures, will it put off the wall of money? At what point does the graph inflect? Perhaps we should interview some of the foreign capital holders and ask at what point do they look to invest elsewhere, and what is the second choice city on their shopping list? Would it still be in the UK or another country or another asset class?

If each of us had £10m to put somewhere, anywhere in the world, where would we put it?

Edited by 200p

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Hmm true - however I think we're probing in the dark here. Even after these measures, will it put off the wall of money? At what point does the graph inflect? Perhaps we should interview some of the foreign capital holders and ask at what point do they look to invest elsewhere, and what is the second choice city on their shopping list? Would it still be in the UK or another country or another asset class?

If each of us had £10m to put somewhere, anywhere in the world, where would we put it?

London might be effected by foreign capital flows...but as far as the rest of the country goes we have got to look closer to home for price props. Bank of Mum and Dad might be a good place to start which this link mentions. The trouble with creating equity is that it is very difficult to destroy especially when you get inter-generational transfers. Unfortunately once you create the debt, the profit and cash created on the other side is still there, it didn't go anywhere and can't easily be removed from the economy.

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Hmm true - however I think we're probing in the dark here. Even after these measures, will it put off the wall of money? At what point does the graph inflect? Perhaps we should interview some of the foreign capital holders and ask at what point do they look to invest elsewhere, and what is the second choice city on their shopping list? Would it still be in the UK or another country or another asset class?

If each of us had £10m to put somewhere, anywhere in the world, where would we put it?

It already has put off the wall of money http://www.zerohedge.com/news/2015-04-12/uk-housing-bubble-bursts-sales-luxury-homes-crash-80-waves-wealthy-people-are-leavin(it was also reported in the FT but cannot find the article).

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£130K combined and can't afford. Unless they are true Cockneys, time to move elsewhere if they have half a brain.

My partner and I had similar situation when living in Paris in the 90s. Crazy prices for not a lot of floor space. We decided to head south and live. Gave up our jobs. Best move we ever made.

I can't feel sorry for these "sob stories" any more. They are adult and in fairly comfortable positions. Unless you have to stay in London , what's the joy in paying 600K for a grotty 2 bed ? I just don't get it ?

(** Unless they see the possibilty of massive capital gains in London housing over the next 10-15yrs and just have to get on the "ladder"....)

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£130K combined and can't afford. Unless they are true Cockneys, time to move elsewhere if they have half a brain.

My partner and I had similar situation when living in Paris in the 90s. Crazy prices for not a lot of floor space. We decided to head south and live. Gave up our jobs. Best move we ever made.

I can't feel sorry for these "sob stories" any more. They are adult and in fairly comfortable positions. Unless you have to stay in London , what's the joy in paying 600K for a grotty 2 bed ? I just don't get it ?

(** Unless they see the possibilty of massive capital gains in London housing over the next 10-15yrs and just have to get on the "ladder"....)

Sob story doesn't add up you can rent a studio in Kennington...ten minutes from Westminster for upwards of £200 a week.........130k a year and required savings of 80k, not accomplished in ten years.

Absolutely not suggesting they should buy at these crazy prices, just that the 80k deposit in ten years was doable.

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E70435&maxPrice=1500&maxBedrooms=0&googleAnalyticsChannel=renting

Edited by crashmonitor

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Radio 4

0730

This morning the programme looks at housing as an election issue. John Humphrys starts his report in his local area in west London.

Jump straight to 1hr 33min

http://www.bbc.co.uk/programmes/b05r0b2v

28 days to listen.

One of the problems is foreign money looking for a parking spot.

Therefore, I think primarily halting immigration won't stop this process (although it should be controlled better). Nor will building more, as the wall of money is huge. A multi-millionaire or billionaire who owns factories in the East can buy with cash, whereas people here buy on debt and have trouble saving for a deposit. Bigger loans at lower rates won't compete with cash buyers - they could always just leverage up.

Stop foreign money? Hmm no political party will stop that either. Only when there is a better investment than London property, will global capital move on.

Stop foreign money and the pound collapses.

Until we start making stuff people want, they'll redeem their bonds with physical bits of the UK.

Who can blame them...even our 'best' exports like the Range Rover still manage to come last in reliability stakes. We charge high prices and build crap.

http://www.thisismoney.co.uk/money/cars/article-2024538/Land-Rover-Range-Rover-reliable-cars--reliable-manufacturer.html

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Sob story doesn't add up you can rent a studio in Kennington...ten minutes from Westminster for upwards of £200 a week.........130k a year and required savings of 80k, not accomplished in ten years.

Absolutely not suggesting they should buy at these crazy prices, just that the 80k deposit in ten years was doable.

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E70435&maxPrice=1500&maxBedrooms=0&googleAnalyticsChannel=renting

£80K in 10 years. Maybe they bought tons of tat and foreign hols with the rest?

Either that or they squirreled the rest away offshore B)

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£130K combined and can't afford. Unless they are true Cockneys, time to move elsewhere if they have half a brain.

My partner and I had similar situation when living in Paris in the 90s. Crazy prices for not a lot of floor space. We decided to head south and live. Gave up our jobs. Best move we ever made.

I can't feel sorry for these "sob stories" any more. They are adult and in fairly comfortable positions. Unless you have to stay in London , what's the joy in paying 600K for a grotty 2 bed ? I just don't get it ?

(** Unless they see the possibilty of massive capital gains in London housing over the next 10-15yrs and just have to get on the "ladder"....)

This is exactly why the crash is unavoidable.

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Sob story doesn't add up you can rent a studio in Kennington...ten minutes from Westminster for upwards of £200 a week.........130k a year and required savings of 80k, not accomplished in ten years.

Absolutely not suggesting they should buy at these crazy prices, just that the 80k deposit in ten years was doable.

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E70435&maxPrice=1500&maxBedrooms=0&googleAnalyticsChannel=renting

Totally doable. I managed to save that, and I was on considerably less than them (and for most of that lived in London too - although admittedly in some pretty grotty places).

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Yep, the missus and I had rooms in a shared house for most of the time we in London. We were eventually forced to move out by the landlord who wanted to convert to flats - and got a 1BR flat for considerably more with no heating, a mouse and bed bug infestation, single glazing and a landlord who refused to put our deposit in a TDS (we got it back from him via the agent instead).

Things have undoubtably got worse since then.

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There was this article in Reuters today too about a 'young' couple...he's 34 for chrissake, they need to get on with it!

http://uk.reuters.com/article/2015/04/21/uk-britain-election-housing-insight-idUKKBN0NC0FD20150421

Insight - New risks as young Londoners priced out of housing market

stock-photo-handsome-bearded-young-man-t

Hipster Beard Alert! Historians and Ecologists make note!

From that article the young man has a hipster beard-

The Hipster Beard is a symptom of high house prices! If you haven't got a house then you "haven't grown up" but with a beard the opposite sex see you as grown up. Therefore don't stress fellows - grow a beard! **** high house prices haha

I started a beard thread for politicians who are out of touch and beardless http://www.housepricecrash.co.uk/forum/index.php?/topic/204251-a-top-tip-for-the-politicians-if-they-want-to-win-the-election-grow-a-beard/

The human race will survive the high house price generational genetic cleansing.

"Life will find a way" Dr Ian Malcom

Edited by 200p

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There was this article in Reuters today too about a 'young' couple...he's 34 for chrissake, they need to get on with it!

http://uk.reuters.com/article/2015/04/21/uk-britain-election-housing-insight-idUKKBN0NC0FD20150421

Insight - New risks as young Londoners priced out of housing market

Also, the other case study in there

Daisy May Hudson, when she was made homeless by being evicted by the private London landlord, in more detail

https://www.vice.com/en_uk/read/response-hidden-homelessness-daisy-may-hudson

https://www.vice.com/en_uk/read/being-homeless-doesnt-mean-you-shouldnt-be-allowed-to-drink-wine-and-have-a-smartphone

https://www.vice.com/en_uk/read/time-to-sort-out-britains-housing-mess-daisy-may-hudson-461

I am homeless, but I have a smart phone, like to dress well and I’m a slave to a nice glass of Rioja once in a while.

.....

They think I'm getting being poor "wrong", like there are a set of rules that I'm not following, and that I don't deserve life's little luxuries.

To those people I say: **** you.

Edited by 200p

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Whilst I agree with the points that they should have been able to save a deposit, items like this help sow the seeds of doubt about HPI. Even if someone thinks they should have been able to save a deposit they will also be a germ of an idea about how really unaffordable housing must be in London if such a couple can't afford to buy.

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£130K combined and can't afford. Unless they are true Cockneys, time to move elsewhere if they have half a brain.

My partner and I had similar situation when living in Paris in the 90s. Crazy prices for not a lot of floor space. We decided to head south and live. Gave up our jobs. Best move we ever made.

I can't feel sorry for these "sob stories" any more. They are adult and in fairly comfortable positions. Unless you have to stay in London , what's the joy in paying 600K for a grotty 2 bed ? I just don't get it ?

(** Unless they see the possibilty of massive capital gains in London housing over the next 10-15yrs and just have to get on the "ladder"....)

But why should they move when people who don't work get to live in London for free? There are loads of pro single parents who get lovely homes in London just for being a single parent.

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But why should they move when people who don't work get to live in London for free? There are loads of pro single parents who get lovely homes in London just for being a single parent.

Yep. London really is an anomaly. The middle classes on good wages can't afford to live here even though they work and pay taxes, don't claim benefits etc. Yet there are so many people who shouldn't be living here but get a virtually free house (either social housing or housing benefit paid), plus all the other benefits and it is actually almost not worth working or just doing minimum hours. Seems like a 37+ hour working week is for mugs. Wish they'd also stop teaching kids to be good at school and work hard = getting somewhere in life. Doesn't apply anymore.

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Yep. London really is an anomaly. The middle classes on good wages can't afford to live here even though they work and pay taxes, don't claim benefits etc. Yet there are so many people who shouldn't be living here but get a virtually free house (either social housing or housing benefit paid), plus all the other benefits and it is actually almost not worth working or just doing minimum hours. Seems like a 37+ hour working week is for mugs. Wish they'd also stop teaching kids to be good at school and work hard = getting somewhere in life. Doesn't apply anymore.

I hope it will be true again in a few years.

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stock-photo-handsome-bearded-young-man-t

Hipster Beard Alert! Historians and Ecologists make note!

From that article the young man has a hipster beard-

The Hipster Beard is a symptom of high house prices! If you haven't got a house then you "haven't grown up" but with a beard the opposite sex see you as grown up. Therefore don't stress fellows - grow a beard! **** high house prices haha

I started a beard thread for politicians who are out of touch and beardless http://www.housepricecrash.co.uk/forum/index.php?/topic/204251-a-top-tip-for-the-politicians-if-they-want-to-win-the-election-grow-a-beard/

The human race will survive the high house price generational genetic cleansing.

"Life will find a way" Dr Ian Malcom

You could be on to something...apparently large beards are status symbols and come in a hell of a lot cheaper than the other kind of nest.

http://www.theguardian.com/commentisfree/2009/jan/09/prince-william-beard

Edited by crashmonitor

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But why should they move when people who don't work get to live in London for free? There are loads of pro single parents who get lovely homes in London just for being a single parent.

They are 34yrs old. Either they use their brains and decide they don't want to pay £600K for a grotty London flat - head out of London and enjoy life - or just continue their lives as they currently do.

He is a law grad now working in as a web admin. No need to sit in London ? - he can work from home and travel to head office as when required. I worked 6yrs from home and travelled every 2nd or 3rd week. It was great. My decision to leave the big metropolis was validated.

Some people don't have that choice...but I'm hearing these "intelligent" people, mid-30s sob stories all the time. Stop moaning and do something - there's another world outside of London zones 1-6. The pay might not be at the same level as the City firms , but you will get your life back.

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Yep. London really is an anomaly. The middle classes on good wages can't afford to live here even though they work and pay taxes, don't claim benefits etc. Yet there are so many people who shouldn't be living here but get a virtually free house (either social housing or housing benefit paid), plus all the other benefits and it is actually almost not worth working or just doing minimum hours. Seems like a 37+ hour working week is for mugs. Wish they'd also stop teaching kids to be good at school and work hard = getting somewhere in life. Doesn't apply anymore.

Nonsense.

It doesn't apply if your only aim in life is to buy an overpriced box in London and spend 30yrs working to pay it off (giving 30% or more of your salary away every month in the process).

For everyone else, it's still great advice.

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They are 34yrs old. Either they use their brains and decide they don't want to pay £600K for a grotty London flat - head out of London and enjoy life - or just continue their lives as they currently do.

He is a law grad now working in as a web admin. No need to sit in London ? - he can work from home and travel to head office as when required. I worked 6yrs from home and travelled every 2nd or 3rd week. It was great. My decision to leave the big metropolis was validated.

Some people don't have that choice...but I'm hearing these "intelligent" people, mid-30s sob stories all the time. Stop moaning and do something - there's another world outside of London zones 1-6. The pay might not be at the same level as the City firms , but you will get your life back.

Sometimes its the change itself which stops people changing.

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