So will the UK house prices ever come down ?

[Scam]

There's a house round the corner from me that sold for £763k in 2006. It then sold for £1.4m last year. So, in 7 years they 'made' £637k. That's £91k a year, for 6 years!

Yeah, sure, the market ain't broken

All these 'owners' that rent from the bank and believe endlessly rising prices are a good thing are completely missing the point. They've given up hammering home the fact no-one under 40 can get a foot on a ladder, they're now starting to talk about people unable to get on the second rung and are bringing up children in pokey flats. At least the 'youngsters' are just refusing to have kids, as there's no way they can afford them when you're paying thousands of pounds in rent and trying to save in a measly 0.5% ISA Bring on the crash.

 

[=XDC=FluphyBunny]

Around where I live house prices are still slightly depressed. Some are holding steady while I have seen others up for sale at -20K for what people bought them for just 3 - 4 years ago.

How anyone can afford to get on the property ladder these days is beyond me.

 

[Zefan]

Although, if I could offer you only one tip for the future, sunscreen would be it.

Lost it

 

[Nitefly]

Stretch.

 

[Yaayuh!]

They've already come down, they're now on their way back up. Average of 6-7% over the past year wasn't it?

 

[FinglisHobbit]

It's a killer for first time buyers. But when it comes to owners wanting to up size or improve area, the profit they made on their house is kinda redundant.

 

[Castiel]

I do not see the problems with people buying houses around here, first time buyers are well catered for and the schemes in place mean people on average incomes are able to get into the housing market relatively easily. London is, like most capital cities, a special case and is not indicative of the market as a whole. Most the the issues with people struggling to get on the housing ladder is really a matter of their prioritisation with regards their income...they want the Car, House, Holidays in the sun and every weekend out on the town. For an anecdotal example, my wife (accountant) helped a friend budget his finances so he could buy a house...effectively she just cut out the takeaways he was eating 3 times a week, cut down his weekends out, reduced his annual holiday to one week instead of two fortnights abroad and told him to keep his car rather than changing it every three years...that was enough that he was able to save a 20% deposit in just over two years and buy his first two bed house. (we live in a relatively expensive region).

There is also too much emphasis on getting on the housing ladder anyway, most of Europe doesn't have such a market which prioritises house ownership in such a way.

 

[platypus]

Seen as House prices are ridiculous so my view is less prosaic. Its interesting to see so many owners blinded by belief that their booming house price has any real relevance going forward with wage drops and mass unemployment, but it all depends on the value of course.

It depends where you live I suppose. We're lucky in that houses of the type we own, in the housing market in our area (Cambridge), can easily sell in less than a week, for cash. And our house has gone "up in value" by almost 50% in that time, and with a new mainline London train station being built in 3-5 years it's only going one way in value.

As you say the biggest problem is the market in general, but then the baby booming generation has a lot more to answer for than merely the state of the housing market. But they will continue to prop it up because it fuels their savings and retirement all the while taking away the free education that they had, free healthcare that they had, the generous pensions that they had, and so on.

 

[platypus]

There is also too much emphasis on getting on the housing ladder anyway, most of Europe doesn't have such a market which prioritises house ownership in such a way.

Yes, they also have different provisions for retirement and more generous state pensions and benefits, so therefore don't need to prioritise home ownership as much.

 

[balky12]

There is also too much emphasis on getting on the housing ladder anyway, most of Europe doesn't have such a market which prioritises house ownership in such a way.

One of the great reasons not to adopt the Euro. Can't have interest rates similar to our European partners, it doesn't mean half as much over there.

Back back on topic, short answer, nope.

What Government wants to sort out the housing crisis?

'Hey people of England, we will build hundreds of thousands of new houses to meet demand. In turn house prices will crash ruining your retirement plans'.

Political suicide.

 

[FoxEye]

Romford seems to be good for renting, I bought a 2 bed place there a few weeks ago and it should rent for £1200 but only cost £219

How can rent be that high?

The average salary is about £25k. That's a monthly take-home after tax of about £1500.

To pay rent @ £1200 would not leave you with enough money for bills and basics.

I just wonder how long it will be before we fully return to serfdom in this country.

[edit: nm, didn't realise Romford is near London... that explains it then Mental prices]

 

[Firestar_3x]

There's a house round the corner from me that sold for £763k in 2006. It then sold for £1.4m last year. So, in 7 years they 'made' £637k. That's £91k a year, for 6 years!

Yeah, sure, the market ain't broken

Wouldn't that depend how much they spent on the house during ownership???

I could buy a 300k house on the right street in the right area, spend 100k and turn it into a 600k+ house.

 

[Dr House]

How can rent be that high?

The average salary is about £25k. That's a monthly take-home after tax of about £1500.

To pay rent @ £1200 would not leave you with enough money for bills and basics.

I just wonder how long it will be before we fully return to serfdom in this country.

[edit: nm, didn't realise Romford is near London... that explains it then Mental prices]

No idea I thought it was expensive, romford is a dump also.

 

[balky12]

How can rent be that high?

The average salary is about £25k. That's a monthly take-home after tax of about £1500.

To pay rent @ £1200 would not leave you with enough money for bills and basics.

I just wonder how long it will be before we fully return to serfdom in this country.

[edit: nm, didn't realise Romford is near London... that explains it then Mental prices]

I live a stones throw from there. That will more than likely be for a flat to. Not uncommon round this way for rent to be in excess of £1k. Romford has direct links into Liverpool Street to!

Many houses in areas around me can reach the £3k p.c.m mark.

 

[Nitefly]

To pay rent @ £1200 would not leave you with enough money for bills and basics.

[edit: nm, didn't realise Romford is near London... that explains it then Mental prices]

I know loads of people on less than that who rent quite manageably!

 

[FoxEye]

I know loads of people on less than that who rent quite manageably!

With some kind of benefit tho, right?

Because basic logic means that anyone taking home less than £1,200 a month is not going to survive if rent is £1,200 Tax + NI is about 32% of gross income, therefore you need a salary of 1.2k*12*1.5 = £21,600.

That's just to pay the rent, nothing else. You won't manage to pay bills or feed yourself on that money, if your rent is £1200 a month.

 

[balky12]

With some kind of benefit tho, right?

Because basic logic means that anyone taking home less than £1,200 a month is not going to survive if rent is £1,200 Rent + NI is about 32% of gross income, therefore you need a salary of 1.2k*12*1.5 = £21,600.

That's just to pay the rent, nothing else. You won't manage to pay bills or feed yourself on that money, if your rent is £1200 a month.

Probably sharing the rent with a friend/ significant other I would imagine.

Otherwise yes, that doesn't make sense.

 

[MichaelAwkward]

Has anyone done any research into what would have happened if the banks were allowed to fail in 2008 like in Iceland? Would we be in a better position now despite the immediate short term pain?

 

[matt100]

Sooner or later yes, its simple supply and demand economics.

It might not contribute to an actual fall, maybe just a stagnation in the face of inflation but sooner or later (and I suspect later frankly) the government will have to do something about this, you can't keep banks under control, increase lending criteria and continue to have house prices rise and not have the majority of young families unable to purchase a house unless we're about to go through a painful switch to a European model of long term renting.

However the political will to grasp the nettle is non existent.

 

[FoxEye]

However the political will to grasp the nettle is non existent.

Have you seen the housing portfolios of most Westminster MPs?

Can we say "conflict of interest"?