Im calling it.....
- Thread starter Dr House
- Start date
That is simply not true. There are loads of jobs, and well paid jobs too.
A job paying 50k up north might get 70k in London, but after you factor in the cost, quality, and size of housing plus weekly living costs, then 50K up North will give you an infinitely better quality of life. You'll have more money in your pocket each month and a sensible house for a less painful price.
I despair when folk I know are desperate to move South, or when I speak to folk who think London is England. I simply don't understand it.
I feel that house prices in London are generally propped up by rising salaries. For instance, for employees in banking industry, a lender would much rather provide a mortgage to an individual whose compensation is now 50:50 between base and bonus, rather than the 25:75 we used to see a number of years ago. A great many other industries that serve or are interlinked with banking have naturally raised their salaries over the past few years to avoid losing staff. With salaries at such levels, I can't see a significant drop in prices. The value of our home has dropped a few percent in the last 6 months or so, but is up significantly from 18 months ago due to renovation works we undertook. It'll likely rise again with Crossrail opening soon.
Interestingly, I asked for certain advice on this forum in 2010 concerning a London property I was attempting to purchase, and was roundly shouted down for financial imprudence and told I should have less faith in the London property market. We narrowly missed out on that property. It has since gone back on the market recently for £1m, double that was paid for it in 2010.
Interestingly, I asked for certain advice on this forum in 2010 concerning a London property I was attempting to purchase, and was roundly shouted down for financial imprudence and told I should have less faith in the London property market. We narrowly missed out on that property. It has since gone back on the market recently for £1m, double that was paid for it in 2010.
Man of Honour
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And since that point you've never trusted advice from anyone here again? The London property market has had quite astonishing growth over a number of years, I guess that there's a feeling amongst some that it's too good/bad (depends on your point of view) to last - like those who prophesise the end of the world at some point they must be right but I wouldn't like to guess when that will be, the basic conditions are still that there's more demand than supply so unless that changes the market seems unlikely to "correct" itself.
What im more shocked about is how anyone in london can afford to live there at all. Ok I understand top bankers on half a million a day but looking at some of the figures for houses being thrown around how do other live? There must be some essential works in london like nurses on 25-30k a year that must literally have nowhere but flat shares to live, where do bus drivers or taxi drivers live? do the cleaners and maids in hotels earn enough to even eat?
All the cabbies I know live in the outskirts, Essex and Kent. Drive in for the day. However they are all doing well for themselves for the most part!
Commuter towns and a job in London is, imo, where the smart money should go. My old man paid 300k for a 4 bed property in zone 6 in 99. Now worth at least a million. 40k a year for just living in it... Astonishing.
Commuter towns and a job in London is, imo, where the smart money should go. My old man paid 300k for a 4 bed property in zone 6 in 99. Now worth at least a million. 40k a year for just living in it... Astonishing.
Caporegime
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that bubble cannot continue though. it will soon end if it hasn't already. if you were buying his house today for a million rest assured in 18 years time it won't be worth £4 million.
cabbies charge ridiculous prices in london. how are people on for instance a min wage job surviving? or are all wages inflated in london to compensate? i know my job pays about £3-5K a year more in london to compensate. however my house would cost about 5-10 times what it does here. it doesn't make sense for anyone doing my job to be doing it in london.
People have been mentioning this bubble for years now. Yea you're probably right, it might not be worth 4 million in 18 years... But what if it's 2 million? Still 55k a year for nothing. Is that still a bubble? Or just house prices doing there thing?
They clearly are surviving. But either commute into work from outside London, flat share, or don't earn as little money as people think. Most likely the first two... Granted they will not have the comfort of people working in financial services.
The bubble will continue on while weve got people earning big money allowed to buy lots of houses. The bubble is simply supply and demand and what people are willing to or have to pay to survive. Simply put if there was an additional tax on having multiple houses or flats there would be more houses available on the market and so the prices would drop. That however will never happen as all the people in power have multiple houses and flats so dont want the additional tax.
I blame monopoly all the high % earners grew up playing the game and think the best way to get richer is to buy up streets of houses with their bonuses. Until something is done to discourage that the bubble will continue to go up till theres no-one left living in and around london that arnt on 6/7 figure salaries, I wonder who will clean their houses drive their cabs and cook their meals for them?
I blame monopoly all the high % earners grew up playing the game and think the best way to get richer is to buy up streets of houses with their bonuses. Until something is done to discourage that the bubble will continue to go up till theres no-one left living in and around london that arnt on 6/7 figure salaries, I wonder who will clean their houses drive their cabs and cook their meals for them?
Caporegime
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actually your right it will continue due to people immigrating to the UK and not enough houses built every year to cope. immigration is driving the market and will continue to do so. the new third child benefits policy will reduce this somewhat as well as some people no longer being able to afford to have children or as many of them but that won't effect the market for years however i imagine prices will go up forever due to immigration, inflation, etc it's just a matter of time. unless there is a plague or a huge war.
would be interesting to see the figures in terms of the number of immigrants coming to the UK are they proportionally going to more populated areas? e.g. if 7% of the UK's population is in scotland do 7% of immigrants go there or is there more of them going to london as a proportion?
Caporegime
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immigrants - prepared to work 70 hour weeks and pay £1000 a month to live in a shed within a block of sheds within someones large back garden.
Compare the conditions they would work in at home, the minimum wage is a fortune to them, let alone sending child benefit home and free health care etc.
The EU expects developed economy workers to compete with those in the third world. Great if you're not the one losing out.
Im not convinced, a lot of those immigrants dont and cant afford to live in the city and never will. The increasing costs of houses in the city are due to the people that can afford to buy them. The london bubble is fuelled by the people that are already there or Russian oil tycoons that can afford to move there. Immigrants are country wide in fact there more in places like Leicester or Birmingham than will ever be in London but there arnt any 4 figure rents for sheds and quarter million pound holes in the ground up there. Its bankers and the like that have fuelled this with ridiculous wages and spending habits nothing more
It's one of the distinct effects of capping banker's bonuses in my opinion.
Dangerous ground, and ultimately will not work.
It will either get front loaded onto their wage, or they will just bump them up with shares, dividends.
Plus how much income from taxes do you think bankers generate both directly (income) and indirectly (stamp duty). Start capping things and talent will just go elsewhere.
It's simple supply and demand.
This doesn't really apply to London, but help to buy schemes are making the problem worse. Plus what government wants to ruin a generation or two retirement plans by decimating house prices? Borderline political suicide.
Caporegime
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how so? london wages are higher. say for example a polish plumber working cash in hand. can he not afford to rent a room within a house? you see them on tv all the time. say a 3 bed house converted into basically 5 bedrooms with a kitchen and a bathroom as the only communal areas. so say the rent was £1800 a month for 1-3 people that would be a lot but for 5 people it's only £350 a month.
immigrants who are here purely to work and send money home or to bank it for themselves are willing to live in such conditions. you see stories all the time of say 10 people found in a 3 bed flat in bunk beds, etc. i've even seen it on tv on these can't pay we'll take it away type shows.
They'll have no choice, just like with 2007, something will give way and its worse now as people are equally as indebted as that moment in time - plus wage stagnation and the incoming inflationageddon.
My gripe with house prices is that it causes gross, unfair inequality.
To be clear, I'm not a lefty, I don't think we should increase taxes and benefits, I'm actually quite right leaning economically. I have no problem with inequality if it occurs because some people contribute more to society and are compensated for it (and then accordingly taxed). But massive house prices increases where people earn more money that well outstrips a professional salary - that I have a problem with. People are being rewarded with massive equity bonuses for contributing nothing to society. Meanwhile the rest of us pay rents that are often higher than equivalent mortgage payments and get no equity and have to deal with our diabolical renting system.
Call me a whining millenial as much as you like
To be clear, I'm not a lefty, I don't think we should increase taxes and benefits, I'm actually quite right leaning economically. I have no problem with inequality if it occurs because some people contribute more to society and are compensated for it (and then accordingly taxed). But massive house prices increases where people earn more money that well outstrips a professional salary - that I have a problem with. People are being rewarded with massive equity bonuses for contributing nothing to society. Meanwhile the rest of us pay rents that are often higher than equivalent mortgage payments and get no equity and have to deal with our diabolical renting system.
Call me a whining millenial as much as you like