Higher end new build flats in London are being bought by Chinese. Councils are giving high rise building permits like crazy as they are trying to increase council tax income due to their budget being cut by the government. Parts of London will end up like parts New York, just investment properties.
House Prices / Interest Rates 2022 onwards
- Thread starter Richie
- Start date
Indeed - my clients have sold thousands of flats in London to investors but even they are now somewhat reluctant. So be it if they want lots of empty flats and no “affordable” housing so no normal people can live in London anymore. There are plenty of other places in the UK to live a very nice life with high wages and good prospects.
Soldato
The problem is Covid has pushed prices outside of London even higher as well as people with high paying jobs and their companies are realising there is live outside of London and remote workers save not he cost of office space.
Our house in Cheshire bought in Sep 2020 has gone up £100k already in just over a year. Interest in that same year on the mortgage about £5500. £95,000 profit. Sure our house is around £1m so if you divide by 4 or 5 to get something closer to the average house, someone would need to be banking £15k-£25k a year just to keep up with house prices. Add in living expenses, renting overhead and saving up for the deposit as well and it shows how difficult it is even for 'middle earners' even with no kids and limited expenses. Never mind people on living or minimum wages etc, they are screwed. Even me being a capitalist tory scum sees this as just not right or sustainable.
There is literally a tax on being poor for housing and then everything else as well.
Soldato
Managed to "get on the ladder" in 2021 with my partner. Remote working has really been a god send and allowed us to purchase far sooner than initially intended as we did live apart.
Be interesting to see what the market is doing in 5 year's time when we will likely be looking to upsize. Now I'm "on the ladder" I don't want prices to fall but them stagnating somewhat would be fine and better for others trying to buy a first home.
Be interesting to see what the market is doing in 5 year's time when we will likely be looking to upsize. Now I'm "on the ladder" I don't want prices to fall but them stagnating somewhat would be fine and better for others trying to buy a first home.
Soldato
- Joined
- 30 Sep 2005
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@Scam I'm not a boomer, but can well imagine how much people are paying in rent. In London, I'd honestly dread to think how much people are paying these days. Wages are higher, but not that much higher.
I suppose so, assuming your income grows nicely over the years so that what started as ~50% of your take home in mortgage payments decreases to much less than that. That's probably a reasonable bet.
Without that ocurring, I wouldn't fancy forgoing having a balanced high quality of life (good entertainment, holidays, early-ish retirement, whatever else floats your boat) for 35 years solely to have a bigger/nicer home.
He was talking about buying a "forever home" so I assumed a "normal home" was within his means without the need for a 7x 35 year mortgage. I agree if the choice is between that and renting then it might be a more attractive option if you'd otherwise be spending the same or more on rent.
Yeah I'd certainly go for a 7x salary mortgage for a bigger home. Retiring at 55 for my generation is a pipe dream if you want any form of luxury. Frankly I don't see the point in retiring at 55 if you've not got a pension paying out 40k+ as you're going to be very limited with what you can do.
My point wasn't that everyone should be aiming to retire at 55, it's that there are other financial needs and goals in life than mortgaging yourself to the hilt. Spending 50% of take home for 35 years to buy a "forever" home is probably limiting ability to achieve these.
Associate
Housing is clearly out of kilter with wages. At work its really telling. Older consultants have massive 7 figure houses and put a few kids through independent school with astay at home parent and single wage. New consultants cannot afford independent school and live in much more modest housing.
Soldato
Which bit is crazy? The £1400 or the 35 years? £1400 pcm for a 4 bed detached in essex seems really rather cheap to me!
Are these older consultants partner-level with much younger other halves? Kinda makes sense if someone is ~50-55 when kids are school age and can thus afford independent schools, whereas someone in their early 30s is going to be way down the food chain as such. Obviously the fact that their 7 figure house was probably a quarter of that when they bought it at 30 years old definitely helps too!