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Are We Back In 2007? The Return Of The 300 Grand Semi...


JoeDavola
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Just checked bma website - that's far more than a consultant.

That puts you solidly in the 1% for NI, even in the top 1% of those who pay income tax.

Source: http://npi.org.uk/files/5014/6235/4367/Economic_inequality_NI.pdf (p.35, fig 13)

PropertyPal currently has 2338 residential properties for sale in Belfast, of which 96 are priced at £400,000 or more.

PropertyNews has 2385 residential properties for sale in Belfast, of which 162 are priced at £400,000 or more.

That's 4.10% and 6.79% respectively.

I'd say there's an oversupply at this end of the market, and most of these won't achieve their asking price.

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That puts you solidly in the 1% for NI, even in the top 1% of those who pay income tax.

Source: http://npi.org.uk/files/5014/6235/4367/Economic_inequality_NI.pdf (p.35, fig 13)

PropertyPal currently has 2338 residential properties for sale in Belfast, of which 96 are priced at £400,000 or more.

PropertyNews has 2385 residential properties for sale in Belfast, of which 162 are priced at £400,000 or more.

That's 4.10% and 6.79% respectively.

I'd say there's an oversupply at this end of the market, and most of these won't achieve their asking price.

I never thought to look at it this way. Good point.

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We have to remember the average house price sold in NI is £123k, far below the £400k mark.

That breaks down to an average of £117k for existing stock and an average of £150k for New.

Its always hard to tell how the whole new build market is doing as one only really knows ones own business. Our sales are well up compared to a few years ago but we have opened up on more sites. there was a lul in sales June and July and I blame the Brexit excitement for that. Sales this month have recovered but to be honest no one knows the outrun of Brexit.

I could double my sales if I could only get planning approves out and all developers seam to be saying the same.

Do you think planning is the bottleneck now BVI? Not finance? Both developer and buyer. Have we moved past this?

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What are we talking healthy tho?

I though in this case we were talking a 400k mortgage for a single parent?

You'd need to be on 130k. That's not SHO territory. That's consultant.

Nope. A single SHO with four years' experience could clear £70K with overtime (and that's the key). They'd get a mortgage at 4.5 times salary and could, if prudent, have saved £15K/year. This puts them at £390K.

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At that level, they ought to be looking forward to salary increases as they make it through the ranks in a hospital career, but £100,000 seems to be the height of it unless you make it to the top as a professor. Strangely, a gp if they choose that route can make more than a top surgeon in one of the big hospitals. Seems bizarre.

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Nope. A single SHO with four years' experience could clear £70K with overtime (and that's the key). They'd get a mortgage at 4.5 times salary and could, if prudent, have saved £15K/year. This puts them at £390K.

I didn't think post MMR you could include 100% of overtime in your lending multiples.

I seriously hope someone earning 70k (trough overtime), with 1 dependent and childcare costs isn't able to borrow 330k. If they can, it's worse than I thought. I could understand someone being able to borrow 330k on a 70k basic better.

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I didn't think post MMR you could include 100% of overtime in your lending multiples.

I seriously hope someone earning 70k (trough overtime), with 1 dependent and childcare costs isn't able to borrow 330k. If they can, it's worse than I thought. I could understand someone being able to borrow 330k on a 70k basic better.

I don't know about that specific case, but, I do know the previously mentioned doctor who was a SHO bought at £335K in 2007 which is approximately £435K in real terms. I also know that last year my work colleague was offered £180K on a salary of £38K. He has a partner who doesn't work and two kids. The banks are still happy to lend more than I think you realise. In the latter case sense prevailed and he has a mortgage of £110K which, ironically, he's finding fairly tight.

If you're bored plug some figures into Halifax's mortgage calculator here:

http://www.halifax.co.uk/mortgages/mortgage-calculator/calculator/#

It's an eye opener.

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I don't know about that specific case, but, I do know the previously mentioned doctor who was a SHO bought at £335K in 2007 which is approximately £435K in real terms. I also know that last year my work colleague was offered £180K on a salary of £38K. He has a partner who doesn't work and two kids. The banks are still happy to lend more than I think you realise. In the latter case sense prevailed and he has a mortgage of £110K which, ironically, he's finding fairly tight.

If you're bored plug some figures into Halifax's mortgage calculator here:

http://www.halifax.co.uk/mortgages/mortgage-calculator/calculator/#

It's an eye opener.

I was aware that lending multiples were still pretty mad but I thought in certain cases (i.e. single parents, overtime) that MMR has tightened them up a bit. 400k on a 70k overtime salary would be madness.

335k in 2007 is nothing, if you brought your cat in they could borrow a few hundred thousand. Self cert is all but dead, (for OO anyway).

38k with 180k is also madness.

Just pumped my figures in Halifax. Scary.

Edited by 2buyornot2buy
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I also know that last year my work colleague was offered £180K on a salary of £38K.

Yup. I'm on the same salary and was offered £180K too, which I thought was beyond ridiculous.

From memory when they were interviewing me they were asking whether I "had any hobbies", by that I mean was there anything else I'd be spending any more of my salary on rather than my house. As if the entire purpose for living and working is to pay the mortgage and keep the house standing.

No thanks, I'd rather have a life where I actually, ya know, DO stuff....

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Do you think planning is the bottleneck now BVI? Not finance? Both developer and buyer. Have we moved past this?

there are a limited number of developers who have finance or access to finance. The banks are now expecting a developer to have experience of what they are doing-imagine that.

However for those who can there is serious delays here. there always was but it is now worse, particularly compared to the 8 to 15 week turnaround in the rest of UK. you allow 18 months here.

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No thanks, I'd rather have a life where I actually, ya know, DO stuff....

To my mind, this is where the argument at higher levels comes apart.

Say you have a £100k salary and want a 500k mortgage. By the musings on this thread, that would be really daft. But think about the numbers. £2k pays that mortgage. That person is clearing 5k per month. Yes, that is 40% of their income and yes it is 5x multiple but the reality is that there is £3k left over after the mortgage is paid. Frankly you would have to be a nut to struggle with that amount spare, even with a pretty exotic lifestyle. If you think about it logically, that person could probably pay off an 750k mortgage and still have more disposable income that the majority of people who have a 'sensible' mortgage with a 38k salary.

On the topic of developments/developers - we are seeing a lot of very expensive new builds. In holywood there are 3 on victoria road and they want the sharp side of 700k each (they are crammed together and on small sites). In marino there are 3 crammed onto a site which cannot be more that about 80 yards long and they want 575k for them (and they seem to be selling). Helens bay there are more. I don't honestly understand how these things can be justified. They are nice looking houses but for the money being asked, you'd expect a bit of a site at the very least!

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To my mind, this is where the argument at higher levels comes apart.

Say you have a £100k salary and want a 500k mortgage. By the musings on this thread, that would be really daft. But think about the numbers. £2k pays that mortgage. That person is clearing 5k per month. Yes, that is 40% of their income and yes it is 5x multiple but the reality is that there is £3k left over after the mortgage is paid. Frankly you would have to be a nut to struggle with that amount spare, even with a pretty exotic lifestyle. If you think about it logically, that person could probably pay off an 750k mortgage and still have more disposable income that the majority of people who have a 'sensible' mortgage with a 38k salary.

This allowed me to dream a wee bit and if the person only had the mortgage and had a simple life (in relative terms) yeah you could afford this and more but most people at this level of pay would have a few more outgoings. Think if most people was getting this level of pay they would have a nice range rover in the driveway. Going to the local car dealer I can get one for £999 per month (deposit £22k and final payment £47k).

Looking at that mortgage the initial mortgage is £2k per month (after having £100k saved for a deposit) but after the deal period it could be nearer £3k. At this time easy enough to get a remortgage but are you relying on it being like this forever?

Again at this type of pay there might be a few nice holidays abroad each year, a few nice hotel stays and few nice diner in nice restaurants, a few health/beauty treatments. Salary could be soon spent and wouldn't be acting like an exotic nut

Of course if it was me I would have a 10 year old car, enjoy a couple of day trips to portrush, treat myself to a subway lunch 2 times a month and enjoy a massive 0.25% interest on all my savings.

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Looking at a mortgage of £750k the initial monthly payment would be around £3k but after that discount rate the monthly rate is £4.2k (from looking at moneysupermarket). Might have to give the keys back to the dealer for that range rover that I was driving.

Edited by carrick01
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It might be wrong to assume that someone sufficiently successful to be earning an amount like this is an idiot! Why assume that someone with all this money would not just buy the range rover? Why, especially with the deals available, would they not do a 10 year fix?

The point was that big lending need not be terribly fraught. Yes, if 3rd generation child is shoehorned into the family business after failing gcse exams, with a big salary and a taste for botox blondes with big boobs... your scenario likely wins. But are we really saying that this is a fair stereotype for higher earners!?

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It might be wrong to assume that someone sufficiently successful to be earning an amount like this is an idiot! Why assume that someone with all this money would not just buy the range rover? Why, especially with the deals available, would they not do a 10 year fix?

The point was that big lending need not be terribly fraught. Yes, if 3rd generation child is shoehorned into the family business after failing gcse exams, with a big salary and a taste for botox blondes with big boobs... your scenario likely wins. But are we really saying that this is a fair stereotype for higher earners!?

You can be incredibly sucessful, clever, creative but still not good with money. Not just idiot sons that go bankrupt also doctors, consultants, architects, artists, chefs and other highly educated people also. No matter what you earnings are you can buy a car for cash but quite a high % still buy on credit. Don't think an example of an high earner having car credit is untypical. My scenario doesn't have any blondes included but that will make bankruptcy quicker

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But of course it is plausible but the reality I was pushing is that the higher the earner, the more they have left over if considering percentages of income. That is simple fact. It isn't right to assume higher earners are less capable than lower earners at spending cash wisely (the opposite should be assumed).

Simple reality is that a 5x multiple is much safer for a 100k earner than a 30k earner. It's just simple maths

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Not technically true. Those from a money background tend to only mix In circles where everything has the cost premium that helps keep it an exclusive community. The only people who aren't skating close to the edge are the real rich, as in those who have enough to money not to need a mortgage for their £5million house, and who change their Range Rover every year without it costing a thought.

Almost everyone else are a only a few months of no salary away form losing everything. Hocking yourself up to the limit is the norm and while I am not interested in being part of that norm, most people seem to aspire or even dream about being the one with Huge mortgage and finance on a flash car.

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Have you ever heard of an American book "The millionaire next door"? It's a survey of the American rich, demonstrating that people who have money tend to be those who don't spend what they make, rather than those who make a lot, and end up wasting it. The point of the title is that your neighbour in his modest house with his old fiesta may actually be richer than the family in the huge house with several quality cars, who owe quite a lot of money. The small house is important in the USA where property tax is high and is not unfairly capped like here.

There's an interesting bit where they identify the ethnic backgrounds of America's rich. Since wealth is based on not spending anything, the richest are of course the scots.

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Not technically true. Those from a money background tend to only mix In circles where everything has the cost premium that helps keep it an exclusive community. The only people who aren't skating close to the edge are the real rich, as in those who have enough to money not to need a mortgage for their £5million house, and who change their Range Rover every year without it costing a thought.

Almost everyone else are a only a few months of no salary away form losing everything. Hocking yourself up to the limit is the norm and while I am not interested in being part of that norm, most people seem to aspire or even dream about being the one with Huge mortgage and finance on a flash car.

When Robbie Williams left take that, he'd no money, despite making several million. Half of his fortune had gone on drinks, cars, girls and holidays, the rest had just been wasted really.

I believe the same quote has been attributed to George best.

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I think we are agreeing!

I am buying the best house I can get without going into debt. In my eyes I will be better off than anyone with a mortgage. I don't drive fancy cars, have loads of holidays nor chattels but I'll own my own home outright at 41. It is only possible because London housing prices are mental and double every 9-10 'years and gave me equity- not through hard work. No one gets rich working hard. I'm not Scottish by the way.

Oh and I thought the Jewish community are the Richest?

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I think we are agreeing!

I am buying the best house I can get without going into debt. In my eyes I will be better off than anyone with a mortgage. I don't drive fancy cars, have loads of holidays nor chattels but I'll own my own home outright at 41. It is only possible because London housing prices are mental and double every 9-10 'years and gave me equity- not through hard work. No one gets rich working hard. I'm not Scottish by the way.

Oh and I thought the Jewish community are the Richest?

I agree and don't agree. I've a largish income, go on about 3-4 holiday a year and drive a decent enough car. I do have a large enough mortgage but it's easily serviced by my income. I would rather look back and remember the glass of chenin I had in Stellenbosch than having my mortgage paid off 5 year's early.

I think there's a happy medium. I'm happy to take on debt I'm confident I can service over the mortgage term. I'm happy to take a calculated risk and enjoy myself spending money at the stage in life I can enjoy it the most.

Edited by 2buyornot2buy
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Have you ever heard of an American book "The millionaire next door"? It's a survey of the American rich, demonstrating that people who have money tend to be those who don't spend what they make, rather than those who make a lot, and end up wasting it. The point of the title is that your neighbour in his modest house with his old fiesta may actually be richer than the family in the huge house with several quality cars, who owe quite a lot of money. The small house is important in the USA where property tax is high and is not unfairly capped like here.

There's an interesting bit where they identify the ethnic backgrounds of America's rich. Since wealth is based on not spending anything, the richest are of course the scots.

There's an interesting thread on the main forum on how it's pretty much impossible for the young now to build capital, so the "attitude of might as well spend it" makes a bit more sense.

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Oh and I thought the Jewish community are the Richest?

The Jews are higher earners, but spend more. Apparently.

There's of course a possibility that these scots are not actually scots - they may just be Presbyterian. Could mean their ethnic origin is actually a short sea crossing from Scotland? No, not Norway.

Edited by yadayada
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There's an interesting thread on the main forum on how it's pretty much impossible for the young now to build capital, so the "attitude of might as well spend it" makes a bit more sense.

And why not? There's some weird belief that if you don't buy a house you'll die a failure. Hang in there and wait for the crash. Boom and bust was not abolished, despite what we were told. By a Scot.

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