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Guest UK Debt Slave

When Was The Limit Of Affordability Reached?

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Guest mattsta1964

At what point approximately should houseprices have peaked to maintain affordability for FTBs

Where I live, a 2 bedroom flat was 90-95K in 2000, still a struggle for Joe Bloggs on 25Kpa. Same property now about 170K and 180K last year. I reckon anyone who bought after 2000 is paying over the odds, myself included. I bought in 2001 and that extra year cost me 10,000 on the price of my home and probably closer to 20K in additional interest repayment. Sick innit

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Guest wrongmove

We live in a competitive world. A two bed flat is easily big enough for a couple, so you are up against pairs of average workers, or singles who are prepared to let the second bedroom. I know several people who have bought recently, first and second time buyers. All but one property was bought by couples.

In answer to your original question, I think affordability is stretched pretty far, but not to breaking point. It took double digit IRs to push people over the edge when prices were nearly this high in terms of income multiples. If IRs rise by a couple of percent, or employment drops, we may see forced sellers and a slump in demand. But (alas) at the moment, transactions are still high, and people (wisely or not) or still "getting on the ladder" in my experience (East Midlands).

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  • 301 Brexit, House prices and Summer 2020

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      • down 5% +
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