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Where Is The New First Rung

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As the first rung with FTBs has all but disappeared, at what level do you think they will, or indeed can return, and what are they going to buy?

Me, Im in the 3 x salary camp, so lets say an FTB is under the average wage, so lets say 20K thats a 60K mortgage Plus 16K deposit

so a 76K three bed terrace. 16 K is a huge deposit for someone renting and earning this sort of money, so price could be lower.

What does this mean for 3 bed semi, detached, then the coveted 4 bed detached, currently on around here ( north essex) for about 285K.

Would appreciate any views.

Happy Easter to all except Gordon Brown and Ben Bernanke.

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As the first rung with FTBs has all but disappeared, at what level do you think they will, or indeed can return, and what are they going to buy?

Me, Im in the 3 x salary camp, so lets say an FTB is under the average wage, so lets say 20K thats a 60K mortgage Plus 16K deposit

so a 76K three bed terrace. 16 K is a huge deposit for someone renting and earning this sort of money, so price could be lower.

What does this mean for 3 bed semi, detached, then the coveted 4 bed detached, currently on around here ( north essex) for about 285K.

Would appreciate any views.

Happy Easter to all except Gordon Brown and Ben Bernanke.

Also look at rents - the yield seems to be averaging around 3% if you buy and rent out at the moment. Double that would be just about OK. So either rents are going to have to go through the roof or prices will have to halve.

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for rents to go through the roof requires tennants with that sort of disposable income, more likely for prices to halve IMO.

you know the feeling when you are on the top of a roller coaster and it is slowly moving down the start of a big dip....

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As the first rung with FTBs has all but disappeared, at what level do you think they will, or indeed can return, and what are they going to buy?

Me, Im in the 3 x salary camp, so lets say an FTB is under the average wage, so lets say 20K thats a 60K mortgage Plus 16K deposit

so a 76K three bed terrace. 16 K is a huge deposit for someone renting and earning this sort of money, so price could be lower.

What does this mean for 3 bed semi, detached, then the coveted 4 bed detached, currently on around here ( north essex) for about 285K.

Would appreciate any views.

Happy Easter to all except Gordon Brown and Ben Bernanke.

There is a lot of help in the pipeline in the form of the 60k house as promised by New Labour. Several Thousand of these have already been built and there are an additional 3million to be built over the next ten years.

Shared ownership providing 60k properties seem to be one of New Labours success stories, and FTB'ers as you mention are well catered for in the future.

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for rents to go through the roof requires tennants with that sort of disposable income, more likely for prices to halve IMO.

you know the feeling when you are on the top of a roller coaster and it is slowly moving down the start of a big dip....

In the last downturn in 1990 small studios and 1 bed flats were selling for around 40% of their peak price in SE London.

I suspect the same flats will fall from say £140k to around £70k

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There is a lot of help in the pipeline in the form of the 60k house as promised by New Labour. Several Thousand of these have already been built and there are an additional 3million to be built over the next ten years.

Shared ownership providing 60k properties seem to be one of New Labours success stories, and FTB'ers as you mention are well catered for in the future.

twadle

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House prices are massively overvalued and have been for some time. It would be great to see house prices at 3 times an average wage, but more realistically, I think that the values you suggest for FTB's are going to be for FTB properties, such as 2-bed flats, at best.

£20k is not a high salary in the SE, where the average is much higher. In about 2000, house prices were apparently at about their long-term average vis-a-vis salaries, so do you know what price 3-bed properties in your area were changing hands for then?

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House prices are massively overvalued and have been for some time. It would be great to see house prices at 3 times an average wage, but more realistically, I think that the values you suggest for FTB's are going to be for FTB properties, such as 2-bed flats, at best.

£20k is not a high salary in the SE, where the average is much higher. In about 2000, house prices were apparently at about their long-term average vis-a-vis salaries, so do you know what price 3-bed properties in your area were changing hands for then?

about 80K I would guess- a friend bought one in 2002 for £110, and I thought she was nuts!

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As the first rung with FTBs has all but disappeared, at what level do you think they will, or indeed can return, and what are they going to buy?

Me, Im in the 3 x salary camp, so lets say an FTB is under the average wage, so lets say 20K thats a 60K mortgage Plus 16K deposit

so a 76K three bed terrace. 16 K is a huge deposit for someone renting and earning this sort of money, so price could be lower.

What does this mean for 3 bed semi, detached, then the coveted 4 bed detached, currently on around here ( north essex) for about 285K.

Would appreciate any views.

Happy Easter to all except Gordon Brown and Ben Bernanke.

How about falling real wages so the UK can remain competitive ?

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about 80K I would guess- a friend bought one in 2002 for £110, and I thought she was nuts!

Fair enough - and I think it would be fair to put the equivalent salaries at the time at about £14k (based on 5% growth p/a).

£14k x 3 = £42k, so even with a deposit, we are talking about a theoretical value of £50k, £30k short. However, it might have been enough for someone on that salary to buy a cheap flat.

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some thoughts ...

- the basic cost of a house is the land + cost of building . I think the rebuild cost for a 3 bed semi

would be 130k (?), but an estate build probably should be as low as 100k (?).

Anyone with rebuild or new build costs per house?

- the cost of land could be that of agricultural land ie 5k per acre , at say 8 houses -> < 1k for land..

So to get the land then some compulsary purchase of agricultural land near cities .

Clearly not applicable to London but feasible elsewhere .

I think I read a few years back, that land in scotland (maybe the highlands?) was very expensive cos

it was owned by a few large landowners who dribbled it onto the market to get max profit.

I think the new scottish exec was going to do something about that .. dont know if they did.

cheers

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Fair enough - and I think it would be fair to put the equivalent salaries at the time at about £14k (based on 5% growth p/a).

£14k x 3 = £42k, so even with a deposit, we are talking about a theoretical value of £50k, £30k short. However, it might have been enough for someone on that salary to buy a cheap flat.

My friend wasnt a first time buyer though.

The deposit came from a sale as a result of an end of life event.

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As the first rung with FTBs has all but disappeared, at what level do you think they will, or indeed can return, and what are they going to buy?

Me, Im in the 3 x salary camp, so lets say an FTB is under the average wage, so lets say 20K thats a 60K mortgage Plus 16K deposit

so a 76K three bed terrace. 16 K is a huge deposit for someone renting and earning this sort of money, so price could be lower.

What does this mean for 3 bed semi, detached, then the coveted 4 bed detached, currently on around here ( north essex) for about 285K.

Would appreciate any views.

Happy Easter to all except Gordon Brown and Ben Bernanke.

how high does the average wage need inflating to meet your requirements 3->3.5? Perhaps you should join the lobby group that is repeatably asking the BOE to print more money?

Edited by moosetea

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Alternativly imagine how much the pound must crash/how much wages must be inflated up?

Interesting, but wouldnt that make borrowing even more expensive with the rises in IRs that would inevitably follow?

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Interesting, but wouldnt that make borrowing even more expensive with the rises in IRs that would inevitably follow?

yeah eventually follow not straight away (lots of extra money in the system would keep the rates lower for the short term whilst the problem is inflated away). How long can you keep lieing before inflation becomes too big to hide ;p IMHO as you approach 3.5x income, interest rates will be raised to to slow the inflation but because house prices are 3x income the public are now able to afford the IR hike... Problem sloved, cheaper pound, expensive imports, easier to get back into manufacturing..

Edited by moosetea

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yeah eventually but probably not straight away (lots of extra money in the system would keep the rates lower for the short term?). How long can you keep lieing before inflation becomes too big to hide ;p

they doing Ok for the last year. My food basket went up about 14%.

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they doing Ok for the last year. My food basket went up about 14%.

IMHO they have been doing 'ok' since 2001, i dont like it but i have to give it to the UK government. They have kept things going by ANY measure through troubled times, why cant the continue with the dumbing down maniplaution and lies?

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  • 293 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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