In Britain, Austerity Is Changing Everything (NYT Article)

[PlacidCasual]

It's funny numbers on a bit of paper right up until the pay packet doesn't go out the door because the bank won't process the payment.

National debt gets inflated away over time but the bondholders price that into the cost. If you are perceived as unlikely to repay the capital or inflate the value away the interest on the bond will increase. We're very lucky we can cheaply borrow debt, but the reason we can cheaply borrow is because there is an expectation backed up by political action that we won't inflate away the debt by printing funny money.

 

[Dis86]

No I don't see the problem. If that were the case. I know how averages work.
You just use them in a round about way to try and prove a point. You band average around with no context.

You are arguing that someone, or a couple, on an average national wage can't afford an average house in the South East, without mentioning it is the most sought after area of the country.

A person or a couple on an average national wage can buy a house in the South East. It will just be a below average house/ flat. Plenty of properties on sale between £100k-£200k. Are they all nice places? No. But that's the way the world works.

- to lighten up the mood.

That's the thing though, you keep talking about it as if its just a small locality. It's not. It's huge, as I keep saying an entire region of the country. The average person should not be priced out of owning an average house in a huge area of the country. Let's also not equate cost with it being a nice house or area.

 

[Freakbro]

But it is still dropping.

Yep, which is good. Though to measure the level of success by the metrics the Conservatives set out themselves with their 'austerity' measures it has been an abject failure - since they were supposed to have wiped out the deficit by 2012 iirc and we all be swimming in surplus by now

I'm sure national debt is anything unusual, it's all funny money anyway ie numbers on bits of paper.
Andi.

As a debt to GDP % figure, no it's not that 'unusual' but as an absolute figure, my god it's just eyewateringly enormous!

We're coming up to £2Tn now...

 

[iamtheoneneo]

But but my personal experience is this and that and I worked my arse off why can't everyone be me, all those fancy economists yellling warning, warning are clueless?

You cant be that naive surely, There are 100,000s of people across this country that do the bare minimum to get by and already get a lot for free. So why do you want to prop them up even more with cheap housing.
What the hell is that going to achieve?

 

[Scam]

You cant be that naive surely, There are 100,000s of people across this country that do the bare minimum to get by and already get a lot for free. So why do you want to prop them up even more with cheap housing.
What the hell is that going to achieve?

What?

 

[BongoHunter]

Houses are more expensive where demand is high, like everything else in the world, even RAM and GFX cards.. yeah it's a bit cap if your on an average wage, but surely that's a great motivator to go out and get a better job!

 

[StriderX]

Houses are more expensive where demand is high, like everything else in the world, even RAM and GFX cards.. yeah it's a bit cap if your on an average wage, but surely that's a great motivator to go out and get a better job!

Bit difficult when the oldies wont vacate said job because they're forced to work longer.

 

[Scam]

Houses are more expensive where demand is high, like everything else in the world, even RAM and GFX cards.. yeah it's a bit cap if your on an average wage, but surely that's a great motivator to go out and get a better job!

lol you have no idea how ignorant you sound right now. Let's just ignore the masses of evidence that demonstrate that 1 in 3 millennials will never own a home due to rising prices, let's just ignore the terrible state of our overpriced rented sector that is a nice kick in the teeth for those trying to save for a "more expensive" house (bit hard to save when you're forced into the expensive PRS), let's ignore the evidence I posted above about exactly how expensive houses are, let's stick our head in the sand and pretend bricks and mortar weren't 'earning' more than the average wage in some areas, let's pretend Manchester a year or two ago was where house prices were rising the fastest, let's pretend ordinary baby boomers that are relatively unskilled haven't turned into millionaires by sheer good fortune Shall I go on?

 

[VincentHanna]

From Rightmove

In the past year house prices in Chelmsford were 5% up on the year before and 23% up on 2015 when they averaged at £289,992.

So house prices have gone up 14% a year where I am.

Am I getting a 14% pay increase a year? Am I hell.

 

[Dis86]

From Rightmove

So house prices have gone up 14% a year where I am.

Am I getting a 14% pay increase a year? Am I hell.

House price increases are massively exceeding pay increases country wide. The few areas that are seeing prices drop are also seeing wages stagnate or drop.

 

[Scam]

Exactly. To put it into real terms there is a house round the corner from me that has gone up on average of 90k a year for the last 7 years (in between sold prices available). There are flats that have gone up by 30k a year. How people sit there blithely saying "you just need to work harder" well it's just plain insulting when bricks and mortar are earning more than the area's average wage.

 

[BongoHunter]

lol you have no idea how ignorant you sound right now. Let's just ignore the masses of evidence that demonstrate that 1 in 3 millennials will never own a home due to rising prices, let's just ignore the terrible state of our overpriced rented sector that is a nice kick in the teeth for those trying to save for a "more expensive" house (bit hard to save when you're forced into the expensive PRS), let's ignore the evidence I posted above about exactly how expensive houses are, let's stick our head in the sand and pretend bricks and mortar weren't 'earning' more than the average wage in some areas, let's pretend Manchester a year or two ago was where house prices were rising the fastest, let's pretend ordinary baby boomers that are relatively unskilled haven't turned into millionaires by sheer good fortune Shall I go on?

I'm not saying the system isn't crap - I don't enjoy paying £1600 a month in rent - or the fact saving is hard in times like these, but you can whinge about it endlessly - or do something about it, which is what my partner, myself and many other millennials are having a damn good crack at, life is hard and unfair and that sucks - but the only way to get what you want sometimes is to put in crap load of effort I'm afraid. I don't want to be working until I'm 70 and never escaping the rent trap.

 

[Hades]

I'm not saying the system isn't crap - I don't enjoy paying £1600 a month in rent - or the fact saving is hard in times like these, but you can whinge about it endlessly - or do something about it, which is what my partner, myself and many other millennials are having a damn good crack at, life is hard and unfair and that sucks - but the only way to get what you want sometimes is to put in crap load of effort I'm afraid. I don't want to be working until I'm 70 and never escaping the rent trap.

You, sir, will either be successful in what you want to achieve, or will at least have no regrets trying.

 

[Scam]

I'm not saying the system isn't crap - I don't enjoy paying £1600 a month in rent - or the fact saving is hard in times like these, but you can whinge about it endlessly - or do something about it, which is what my partner, myself and many other millennials are having a damn good crack at, life is hard and unfair and that sucks - but the only way to get what you want sometimes is to put in crap load of effort I'm afraid. I don't want to be working until I'm 70 and never escaping the rent trap.

And what makes you think I'm not trying? I started my career in London on minimum wage and still managed to save whilst living in a houseshare with 5 others. That took a lot of hard-work and perseverance. I've been saving hard my whole career. Fast forward 9-10 years later and I've still been saving as hard as the next person -- but besides a nice number in my ISA and a bit more of a comfortable life (due to living with my girlfriend and earning more) I've essentially got diddly squat to show for it.

You're allowed to work hard, aspire, and put in a boat load of effort -- and complain about the system simultaneously you know?

 

[dowie]

And what makes you think I'm not trying? I started my career in London on minimum wage and still managed to save whilst living in a houseshare with 5 others. That took a lot of hard-work and perseverance. I've been saving hard my whole career. Fast forward 9-10 years later and I've still been saving as hard as the next person -- but besides a nice number in my ISA and a bit more of a comfortable life (due to living with my girlfriend and earning more) I've essentially got diddly squat to show for it.

You're allowed to work hard, aspire, and put in a boat load of effort -- and complain about the system simultaneously you know?

I'm not trying to ignore that there are issues but didn't you also post previously on this subject about spending some silly amount on rent, presumably if you'd chosen to live in a cheaper area then over those 9-10 years you might have saved substantially more?

What I mean is there is generally a mix of factors, for example some of my friends who are often complain gin about being skint and work in media still want to live in fashionable areas and pay nearly twice as much in rent as they'd be paying if they lived somewhere more affordable.

 

[SPG]

Exactly. To put it into real terms there is a house round the corner from me that has gone up on average of 90k a year for the last 7 years (in between sold prices available). There are flats that have gone up by 30k a year. How people sit there blithely saying "you just need to work harder" well it's just plain insulting when bricks and mortar are earning more than the area's average wage.

Then leave the area, no one is forcing you stay.

 

[VincentHanna]

I know you aren't talking to me, but my business is setup here. I've got an office with employees in it.

Do I want a 90 minute commute each way to be able to afford a house in a cheaper area in the middle of Suffolk? Quality of life is also important.

 

[Fubsy]

Problem with moving away is that then you end up spending time and more money still on commuting. Not exactly great public services at the time being either.

There's certain areas where there is a sweet spot between living costs and wages.

I know I can't go moving back up to the NW to do what I do because there is nothing comparable near by, and surely there will be other people that just have to stay where the job is and live as cheaply as they can.

 

[Secret_Window]

Even if hypothetically you wanted to commute by train to somewhere like London for work from the North West everyday, going by average cost of train fares I don't think even that is affordable for most people.

 

[dowie]

I know you aren't talking to me, but my business is setup here. I've got an office with employees in it.

Do I want a 90 minute commute each way to be able to afford a house in a cheaper area in the middle of Suffolk? Quality of life is also important.

probably not... but someone living in a flaitshare in London paying 900 a month for a room in Zone 1 or the central bits of zone 2 vs paying say 500 a month in some less trendy part of zone 3 saves a fair bit

ditto to some couple paying a 2 grand a month for a 1 bed vs more like 1 grand a month in a less expensive area... over 10 years that's easily a deposit

I think it is a mix of things, property has become less affordable but also there are some personal choices people can make too