Almost all young people under 30 want to make buying a home a top priority, and don’t want to settle for long-term renting.
The poll, of 2,465 consumers of all ages, blows wide open the theory that more and more will go the European way and choose to be tenants for lifestyle reasons.
People under 30 are more opposed than any other age group to ‘continental’ models of tenure in which families routinely rent for the duration of their adult lives.
Some 90% of 18 to 29-year-olds would not be happy if they had to live in rented accommodation for the rest of their working lives. A majority (64%) do not want to start a family while they are renting and 43% do not want to get married until they own their own home.
The poll, conducted independently for Barratt Homes, also suggests that tensions between different generations and long-term social problems will result if young people continue to be locked out of home ownership.
The study shows that 86% of under-30s identify home ownership as a key priority in life. For them, this is a more important life goal than job satisfaction (which attracted a 76% vote as a life priority).
According to the findings, almost two-thirds (65%) of people under 30 believe that they cannot afford to buy a home as big as the one which their parents lived in at the same age. This figure rises to 75% in the South-East.
Young adults also increasingly resent the housing wealth acquired by the over-40s. Some 44% of 18 to 29-year-olds describe the housing wealth which the generation over 40 has accumulated because of rising house prices as ‘unfair’.
A large majority across all age groups think the housing crisis will get worse rather than better: 61% agreed with the statement: ‘In 20 years’ time it will be even more difficult for people to get on the housing ladder than it is today.’
The Barratt HomeBuyers’ Panel is the second annual survey by the independent polling firm ComRes.
Mark Clare, chief executive of Barratt Developments, said: “The findings from this nationwide poll illustrate the extent of the housing crisis facing Britain and the depth of the public policy challenges we now have to tackle as a result.
“There is no silver bullet which will solve the problem overnight, but there are steps which can be taken.”
“Without doubt, making mortgage finance more readily available to credit-worthy first-time buyers should be top of the list. It cannot be right that people in their 30s with good jobs and good credit histories are having mortgage applications turned down.
“I am pleased the Government has rightly identified this as an urgent problem and is meeting the banks to assess what can be done.”
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Comments
“Buy to let” was a fashion thing promoted by greed and after dinner aspiration talk. SR was sniffy about a 5% yield, any investment doing 4% above BOE rates and by most standards a very conservative investment can’t be too bad. To describe that as poor is a sign of how greedy our society has become
Rent to own, rent to save, rent for retirement, is something different. If you have got spare money each month and a pot saved up I still cannot think of a better place to put my money.
10% deposit, yield 5 % less 3% borrowing means a gross yield of 2%. Chip away at the capital and by the time you get to retirement you end up with a retirement plan that hasn’t been raped by commission or dubious fluctuations of the stock market. I am happy that my pension plan is index linked to rental values and my pension will not die with me (I can leave the properties to my grandkids) Unlike a pension plan If I decide to sell I can get at all of the capital rather than 25%.
Yes I have to pay CGT but so what. I am in control not some spivvy Herbert with no idea.
I have worked out these HPC jonnies, what is the betting they are part of the “We buy any house .com” brigade? Makes sense to me, convince punters with problems that they need to get out before the market falls too much further!
Pah! Is all I can say, you do what you like, I am not worried about prices falling, my pension will be good for about £4000 a month in 16 years. Unless one of the folk smarter than me comes on and says that rents are going to drop by 50% too. If they do £2k a month is better than the state pension.
Well said George. You make good sense.
Just some advice, What do you think about buy-to-let at this moment in time. Is it over-saturated? Thinking of dipping my toes in one.
The whole point of that Steven is to prompt the folk to realise that put in the position of a vendor who is being asked to fund the aspirational dream of an FTB.
Given mortgage rates of 3% available to anyone with equity in their home it simply doesn't make sense from any perspective to take a 10% cut in the value of your home unless you are forced to do so.
A 3 % interest only mortgage buys any vendor with a potential problem over 3 years of "wait and see what happens” time, rather than accept a 10% cut right now.
20%? A lot can happen in 6 years including a change in government, World War III. Sensible homeowners who do not need to move won't.
I have said it before on the very many threads we have had on this subject there are simply not enough distressed sales (death and repossessions) to create anything like the glut of properties that would facilitate a 10% cut let alone anything more.
Hi George,
Good challenge but problem is SR, roger, elle, jonny et al don't have any houses to sell. That is why they are hoping with teh crash they may be able to buy one of the cheap. Well heres hoping chaps.
The only thing the have is lot of gas. I wish they would put their money where their mouth is.
2nd email.He will sell the property to anyone at house price crash for the current open market price but require only a 5% deposit.
He will then give them an interst only mortgage at vaiable bank of england rate +1.5%.
The purchaser to pay all fees, when the property is sold he/ his estate will take his profit or loss. None of the increase or decrese in value need bother the occupants
That fulfills Peebee's Roof over the head ideal and the HPC crowd ar happy too they don't have to worry about the 50% drop that is headed our way.
One of my chaps has made an offer to anyone participating in this thread.
He will buy and complete on any property that you chaps want to get out of at just 20% off today's open market valuation.
He is happy for an independant RICS surveyor to establish the price and he is happy to pay 80% of that figure.
1 condition he wants anyone who wants to sell but won't to explain why his offer isn't acceptable and those predicting a 50% reduction to say why his isn't a great offer.
@wonder where I fit:
"SR you might be really smart but all your economics simply do not consider the emotion, greed and aspirational snobbery of the property Market."
no they do, they consider underlying value, affected very much by greed etc - this is all in the yield in fact
" Population pressure doesn't seem to feature in your theories. "
again it does, markets price demand changes in too. Population pressure isn't as great as people suppose in the UK, net immigration is of the order of 0.2% or so, it is very easy to build enough houses to cope; the new high speed 2 railway line SHOULD be a help to reduce pressure in the South East (extending the london hinterland to leeds, manc etc), as is ongoing devolution of the economy spread around the country a bit more
In my book you fit in the sensible camp.
Providing for your kids, saving and securing a roof over their heads ticks 3 sensible boxes. Plus it teaches them by good example.
Presumably they have better manners than some of the folk who have posted on this story?
The indisputable Facts are:
It was a bubble.
Its going to go pop.
Like every other bubble before it.
First Time Buyers will not be buying.
Elsewhere in the world we have seen 50% drops.
The same will happen here.
End of Conversation.
Will leave you estate agents now to quibble between yourselves.
Whatever happens to prices both my children have got houses to move into when they are old enough. Both of them know what the size of their first mortgage will be. I saved hard for my first house and carried on saving and paid off my mortgage early. I bought a house for my son, kept saving, bought a house for my daughter and now I am saving for my pension.
it does not matter what happens to prices my whole family has somewhere to live an I have managed to switch my kids inheritance to the start of their adult life rather than when they are set up and 60 and not needing my money.
SR you might be really smart but all your economics simply do not consider the emotion, greed and aspirational snobbery of the property Market. Population pressure doesn't seem to feature in your theories.
@PeeBee - Fair Play!
"You are obviously a keen follower of economics, and trends - as are many of the HPC people. Often, extremely valid points come out of posts, however as the vast majority of homeowners neither subscribe to socio-economic trends care a hoot about them, I am afraid that all the financial education in the world is useless when it comes to predicting precisely where prices will be tomorrow, next year - or next century. "
You are mixing up 2 things - (1) the subject of finance, which,m as Keynes once said, is based on psychology, and (2) the existence of amateurs in the market.
**All** markets involve financial amateurs to some degree ot other, economics and finance are primarily tasked with understanding the interplay of these amateurs via market mechanisms.
I agree we cannot predict the future price. I will cite several authors. One (can't remember 'is name) got nobel prize for economics for proving from some basic principles what you already knew - that market price movements follow a randmom pattern in the short term. Another, the great Benjamin Graham, postulated, in a court of law, when asked how did he know his investment measures would pick securities, bonds or other assets (many of which are traded by inexperienced semi-professionals and amateurs) that would likely rise in value ('value' investing style) said 'in my experience this is always the case in the long run' when challenged by a judge. The great Jack Bogle, one of the most reliable mutual fund managers ever simply due to his respect for the efficiency of the market, openly says you can only guess-timate long term growth based on macro-economic views - again incorporating amateurs in stock and bond picking , and company admin, etc. And he definitely says to avoid short term speculation. So yes, one of the rules of finance is you cannot predict the future, but one of the other rules is that, informing yourself about the large scale forces that will influence long-term trends, you can ascribe probabilities and let those inform your actions, even when a market is dominated by amateurs with big lines of credit (unlike any other asset market in this respect right now, but nnot in the whole of history, there are definite amateur parallels with other asset markets dominated by amateurs in the past).
So, basic value theory and indeed supply and demand DO apply to house prices, even gven the amateurs in the market. we can't make hard predictions, but we CAN place house prices within the context of what has gone before. In ALL markets with and without amateurs, there are price to earnings ratios of one type or another, and indeed they do fluctuate, the USA stockmarket price to earnigns ratio tends to be higher than the European markets', apparently because they have more speculative technology companies that can make very big profits or go bust, whereas european companies have a habit of being more conservative and hence don't go bust as often, so they can support lower profit margins and assure the investor they are worth holding at that price anyway. but the difference between the Pe ratios of US and european stocks is not greater than some 10s of %s. This brings us onto the house price to income ratio. This is running at about double its long term average trend. Either (1) something permanent has changed, or (2) house prices will likely one way or another one day come back to the long term trend, ie fall quite a lot. The only things i can see that has changed has been the national debt, and the development of assured shorthold tennancies and BTL lending to go with them. We started with about zero in the early 2000s and managed to build up almost a world war's worth over about 7 years. Unless the BTL phenomenon is a step-chenge (and in my opinion it is not, it is simply another pricing mechanism that happens to be dominated by amateurs with an unually large amount of fincance avalable for a short period) I have not seen any other significant trend that went alongside the increase in the house price ratio. So, in all likelihood, as debt is paid down over the next decade or so, the reverse trend is LIKELY to occur. I say likely because, you are correct, it is impossible to predict precisely, but as I say, we need to think in terms of statistical likelihood in this case. This makes houses, in purely financial terms, and certainly in investing terms, a 'don't buy' asset class.
Again, with respect to amateur landlords potentially holding the market up - comparing yields and likely future yields (looking at governemtn and personal debt) it is hard to see decent profits vis a vis other investable assets (mostly traded stocks but other business wealth and inventory of various kinds count) to be there in property over the medium term. Even amateurs catch on to this in the end. OK, I can work it out in a spreadsheet, against probabilites, in about an hour, and it may take them severl years of practical negative experience to work it out, but even amateurs catch on to an over-valued market in the end, and it will find its natural level. And there's me making predictions again, just that, in all probability, they will find net losses for quite a few years to come, but I might be wrong, I'm going in circles....
But of course lifestyle also plays a part for owner-occupation:
"THAT is a balanced housing market. The numbers may be way down on averages at present - but there are still numbers. Prices may well continue to adjust - but I would sincerely suggest to all that you either look at a house first and foremost as a roof over your head and not a cash-cow - or let someone else worry about it and rent off them. "
Agreed
Overall, 2 things jump out at me at the end:
(1) HPCrs are foolish to make very specific predictions, as are all serious investors - I took a big punt on stocks and commodities 2 years ago as they looked LIKELY to be a good buy, but of course this is statistical chance, I made no prediction at the time, except to say they looked good longterm value to provide income and growth, which is not so specific as to say they will be worth X in 5 years time.
(2) I have no reason to hold anything against estate agents. They have a job to do that is getting the best price for their clients and bringing buyers and sellers togther.
Austin- you just made yourself look even more stupid!! Did not think it was possible but you did it!
Of course its an abbreviation you pillock!! That why I made reference to you having been at your products, you thicko!
Laughing all the way to me flash home, in me posh motor, thank you so much.
Enjoy the weekend in your hovel. I am bored of you now and the silly billys on here like you, I will not bother opening the story again, so rant away!
No Richard – you are the cretinous individual, you are so ignorant you do not even note the source with which you base your assertions about property – fecking Savills you chump.
And your response, or lack of, to any points raised about economic issues which will affect your profession is laughable. Amateur.
Oh by the way – pharma – industry short hand for pharmaceutical. Never mind.
Put your heads back in the sand; pretend that the economic issues impacting on consumers, government and the banks will not have an impact on your market ‘bubble’ – it is hilarious.
Peebee there was a glamour of light there when you said: “but I would sincerely suggest to all that you either look at a house first and foremost as a roof over your head and not a cash-cow” at last some there is some sense!
There, that told him, but in a way that he thinks I am nice any you lot are a tad thick!
The Real SR: I'm gonna call you SR - okay? The other one needs no answering - and I doubt very much a regular, serious contributor who adds substance to any discussion. If they are by some miracle of chance - then they should be suitably surprised by their own actions.
It says something about the feelings that are rising high here when AceofSpades - one of the most consistently calm and reasoned posters on this site - gets embroiled in a ruck. To be honest I don't blame you or him/her/whoever - but valid arguments are immediately weakened when the guard comes down. Me - I just poke certain people with a stick and see how loud they squeal! ;0)
ANYWAY - back to the discussion points you have kindly put forward. You suggest that I am reflecting sentiment in my earlier novelette. Am I? Years ago, I WAS THAT PERSON. My parents lived in rented accommodation (Police Houses in their case...) all their married lives. My wife's parents did also. There was nothing wrong with that - but we wanted to buy our own property - and they wanted us to also. I HAVE NEVER entered into a property transaction as a financial speculation - a house to me was first and foremost a roof over the heads of my family - and I felt that 'owning' my own property gave us a surety of tenure that renting could not guarantee. Two moves as the family grew (each time when it suited us to move, not when the market looked good...) have left us in a modest but comfortable home that in NO WAY could I afford today thanks to houseprice inflation. My sons and their families now live in rented accommodation for the same reason, and may do so for the rest of their lives for all I know. SO based upon my own words, I should be screaming for a monumental bang to deflate the 'bubble' and allow my lads to reach their personal goals of being homeowners.
But I know that it is not that easy. There will always be buyers. Reduced numbers, maybe - and prices may fluctuate accordingly when sales become the necessity rather than the dream - but in the main none of us can control a whole market based upon supply and demand; availability and proceedability - even in moderate numbers.
You are obviously a keen follower of economics, and trends - as are many of the HPC people. Often, extremely valid points come out of posts, however as the vast majority of homeowners neither subscribe to socio-economic trends care a hoot about them, I am afraid that all the financial education in the world is useless when it comes to predicting precisely where prices will be tomorrow, next year - or next century.
The books tell you that is the case. Talking about books - EVERY "Sales" book ever written is based upon a professional salesperson transacting with a professional buyer. The buyer knows what they want; when they want it; and how much they are willing to pay. THE VAST MAJORITY OF HOMEBUYERS ARE COMPLETE AMATEURS, who do not, in the main, conform to the above professional buyer profile. They buy because they like the look of something; because their sister/brother/cousin/friend has just bought one - Hell - any number of reasons. You get the picture - and you also know the score. Why do YOU want to buy?
Those who do buy either look to the past for guidance - and see plainly that long-term growth is the norm, or simply WANT to buy and do it regardless of potential risk.
THAT is a balanced housing market. The numbers may be way down on averages at present - but there are still numbers. Prices may well continue to adjust - but I would sincerely suggest to all that you either look at a house first and foremost as a roof over your head and not a cash-cow - or let someone else worry about it and rent off them.
I won't even go there with the car analogy. Believe me - I could write EVEN MORE on that thorny subject than i have here... ;0)
Yours respectfully.
@PeeBee
fair enough, I did fail to discriminate, as you can see i gave up.
Can i take you up on this:
"Young people - you might remember being one once... simply would like to own their own property. Why? Simple: EITHER their parents did - and therefore they want to show that they are equally capable; or their parents didn't for one reason or another, and they want to show their parents that they can achieve something that the older generation could/did not.
You forget the mind-set of the nation. To own your property is a feather in your cap. That is why we will never fully integrate with our Euro cousins.
You rent a house for 25 years - you own nothing. You pay a mortgage for 25 years - you have a tangible asset that SHOULD, as far as all written records will attest, be worth far in excess of your initial purchase price. If it isn't... so what? you still have the asset. "
I would say that you are reflecting sentiment; people tend to emphasise recent experience over history. In that respect they are seeing that their parents and grandparents often bought property and did well out of it over their lifetimes, and extrapolate this to assuming they could do the same.
The simple fact of the matter is that long term gains have been concentrated in the past decade, that is in real terms, after inflation, the past 10 years have broken from the long term trend of house price growth following inflation-plus-economic growth. Previous to the year 2001 (ish) houses had done perfectly well (avoiding buying at short term peaks helped a lot if you compare 2 people who did or didn't); since 2001 they have gone spectacular without any exterior trigger - except one. The gargantuan rise in personal and government debt.
I would not argue the general historical case that houses tend to bhe a decent investment; at the same time, current house price values are stretched way beyond the typical historical trend, and the principle, evident in all markets, of reversion to the mean suggests that this trend will be reached again.
To come back to the first point, that UK under 30s want to own houses instead of rent them. To some degree there will be a natural bias, people in Spain and Germany would also like to own their own home, it is a human preference, certainly tpo those I know. But on top of that is shorter-term sentiment, which is a function, partially, of over-focus on recent history. Recent history shows the greatest upsurge in house prices in the UK ever, which people have extrapolated to be the norm. As I said, strip out inflation and it is looks extremely abnormal. This element of sentiment is, going off histories of bubbles in the past, fickle and changeable. sure, the under 30s want to own a home, frankly most of the under 30s want to own a nice car. The difference between the car and the home analogy is that they will consider the price of the car and if it is too much they will avoid it. With houses there is this sentiment that the price does not matter so much because it will make you money. I believe that this latter sentiment will change and, tho under 30s will always want to buy a home, it will not be at any price, and they will become less motivated to buy a house just yet, as house price falls gather momentum, which will have a positive feedback and compound falls.
The Real SR: With respect, Sir/Madam/Prefer-not-to-disclose, do not assume anything that you cannot substantiate.
Someone has 'stolen' your posting name - I have been victim to this before also. However, you immediately jump to the conclusion that it was an Agent - and your abusive retort is both scattergun and unproductive to your own position.
You have no proof - just reason to believe. So why launch an attack on a group of individuals because of one person who MAY NOT EVEN REPRESENT THE GROUP.
Prior to your last post, you offered reasoned argument. I may not agree with you, but I respect you have an opinion. I have posted my own feelings on the subject matter earlier in the proceedings, which you will undoubtedly disagree with these. Lets have a debate then.
The barrage of namecalling is an indication that the fight may be already lost - by both sides. There is little chance of retrieval of order at that point - so you will just go on with arms flailing and not look at what you are trying to hit.
Please, everyone, wind yer necks in a bit; take a breath or two - and continue with some decorum.
@therealSR did you know that on your advice your Nan took out an equity release mortgage? "That will teach the bastard banks. 50% drop will leave the FLICKERS well out of pocket along with that greedy grandson.
You are just mean! there were not millions and millions, my father had a very low count. and them that there were had bent tails
Good job for me Uncle Ned on my mums side was able to help out!
As this thread isn't about Banjo playin perhaps you are right.
I am sorry!
Austin- "pharma??" been at your own products too much? You have been made to look very silly with your posts and replies. Still laughing at the A4 gaff!
If the comments by Estate Agents on this thread are anything to go by you are all utterly ignorant, entrenched in assumptions fostered during the heady days of cheap credit for everyone. Those days are over and will never return – fancy the UK’s chances of paying back £4 trillion?
Again any two bit fool can ride a bubble. Your total lack of abilities in being able to address any points raised about the impact of broader economic challenges facing the State, the banking system and the UK populous just points to your total lack of foresight as to the market conditions you operate in. To flag up a 95% fall in net lending as not having an impact is just cretinous in the extreme.
By the way i work for a pharma company in Basle and am happy in the knowledge, if this site is anything to go by, that you are all so ignorant that you deserve what is coming. The fun has only just begun. Good luck with the volumes.
"Added by SR on 2011-02-04 08:11:30
Listen Plebs I have a Masters in Euthaneconomics. Global warming with its resultant warm winters mean the bubble has to bust "
you bunch of sad muddled sh*t for brains.
I didn't personally have a direct issues with EAs, none of my posts did, just the unsupported argument that this market is somehow different and not a bubble.
General cr*p like illogical rationalisations, straw men, immitating posters (oh so clever - lack a logical argument? be a tw*t instead, if you shout louder then you win! woohoo!), devalues your positions
stupid stupid stupid.
Jonny, Jonny, Jonny - millions of sperm cells and you were the fastest and brightest?! What an absolute waste. Tragic.
I'm certainly not 'running away from you', I just feel the language that has been used by you and your poor mates is utterly disgraceful and I do not wish to be associated with that.
You have had NOTHING of any relevance to add to this thread, a bit like your life perhaps? That's just a question, not an insult. The sperm comment was an insult.
George - get with the channel..not 10% - they want 50% - 60%.
One Question that hasn't been answered yet - WHY do you continue to attack agents (in such a foul manner)?
There are plenty of other sources available to buy property, cutting agents out of the chain completely - use those instead. YOU WILL NEVER HAVE TO SPEAK OR SEE AN AGENT IN YOUR LIFE - YOU ARE ALL CHOOSING TO!!
Cut out the agent and buy/sell privately - that is ridiculously simple.
Do you put similar posts on the BMW forum because you can't afford one of those either?
Brilliant idea Wardy, Lets do what they want us to do. Peel 10% off everything Bring the average house price down to £148,500
The deposit will come down to £37125 and all those 38 year old Timothy Lumsdens can clear off.
My thick investors will be pleased too, they can buy up a place every 9.8 days and their yield will hop up to 5.4%.
For the geek economist, what does your book say about us peeling £200,000,000,000 out of the economy at the stoke of a nibbled Bic by next Friday?
Listen Plebs I have a Masters in Euthaneconomics. Global warming with its resultant warm winters mean the bubble has to bust
Mooohhahaallagentsmustdie.com predicts that the buble must bust.
a 1 degree mean winter temp rise means that 12.6% less mortality for the forseeable future.
The cold snap in December supports this theory and the increase in sales reported by George D and others are a direct bi product of that unexected cold snap. Its a bubble I tell you. The jet stream reverting to its normal SW flow means you lot are doomed.
Did I say, its a bubble!
PS the Buble will bust too he is Scandananian and the shift in the Jet stream has warmed him up.
If I had a girlfriend who successfully passed the test and became Mrs R I reckon she would claim that she wouldn't mind warming up Mr Buble!
Its a bubble! Its a bubble, a bubble I tell you! You mark my words, its a bubble!
Nonce!
Its not good quoting web page hits to this lot they know damn well that web hits mean nufink.
Rightmove hits are going up but sales aren't, all them hits are from people checking up on Nans House.
Shippie, as he now let me call him after my subtle TDMG bashing session the other night says, we are working on a new project "Nan's net worth"
I am not supposed to let on but it works like this
Simply enter the number of siblings, enter where each of them wants to live and we will do the rest, basickly 25% of the average starter home value is calculated from the index data that is multiplied by the number of brothers and sisters and if Nans house comes up trumps she gets whisked of to Switzerlanfd or Northern Australia for a holiday with out new site RightMooMove!
wow! just wow. you HPC lot are an angry bunch. Your argument has been put forward in such mature and intelligent manner that I'm actually going to start under valuing tommorow. Thank you for helping me to see the light without a crule word or derogatory comment. I bet your glad your ramblings have not fallen on deaf ears and a least one EA is now a convert. I'm off to HPC now for a good old cry.
Dan1el: Please enlighten me.
Do you prefer Edit > Cut > Edit > Paste when you spread this drivel all over the net, or do you use fancy shortcuts?
I see you as a shortcut man, myself..
(For the record, I'm a Cut & Paster. Even sorted out the typos in this one!).
Also: Why do you type. In such short sentences. [Using these brackets]?
IF, as you suggest, FTBs do not like being robbed, then they have the answer in their own hands. DO NOT BUY! But that is not the case. They WANT TO BUY - but find themselves unable due to factors that I am not going to engage in trivial argument with you about. You simply want to show everyone that your Economics GCSE was worth the wait and several re-sits so that you can use all the snazzy buzz-phrases.
Pity you don't comprehend or appreciate the HUMAN aspects of house selling and purchase - the factors that guarantee that Estate Agents will ALWAYS be a part of the process, as they are worth their weight in gold when the brown smelly stuff is hurtling toward the electrically powered ventilation device.
Who knows - one day, you might even find that out for yourself...
Hi Dan,
((It is certainly completely unfair, and criminal, that the UK taxpayers who do not own property, should have to pay to recapitalise Lloyds via the bailouts)) - I am sure Dan, Ace and I pay much more taxes than you, Elle and jonny put together. So if there is anyone who should be annoyed it is us. Not you.
Have you had a chance to speak to Nan for a loan yet?
Lloyds now owns over 33% of the UK's residential mortgages. Acquired from HBOS. [Of which up to 80% were basically liar loans. Self Cert mortgages according to senior insiders and whistleblowers at HBOS]
Its immaterial what the banks will be sold for, or what they were bought for. [Before one of you bright sparks mentions that.] Although HBOS and Lloyds SP crashed spectacularly post 2007
[It is certainly completely unfair, and criminal, that the UK taxpayers who do not own property, should have to pay to recapitalise Lloyds via the bailouts. Without this recapitalisation, property prices would have plummeted back to their long term average affordability. Which would mean over 50% falls. So by stealing our Taxes, QE, keeping Interest Rates at the lowest they have ever been, we are in effect being forced to pay to keep everyone else's property massively overinflated. Keeping millions who are not on the housing ladder yet, from being able to afford their own property. That is complicated thievery. Implemented by Labour Party policies.]
There is still the risk that the banks may be broken up. Monopolies commissions etc.
[The HPC website receives approximately 546,000 Page hits per week. FTB'ers do not like being robbed. Which is what is happening. Would you sit for this? Of course not.]
You EA do not bother me frankly. [Those of you who will still be around....]
60% reductions same as other countries will happen, or we will see wage inflation.
Ta ta for now. :0)
Hi George,
I am not an agent but I am not surprised. Its the Jonnys, Elles and Dans of this world that would just do that. Chances are they would be getting Nan to give them a deposit before Nan kopped it. But they will be the first ones to preach fair trade and green.
Sorry if that upsets you mate, but if you lot can come on here and post steriotypical comments about agents then don't be surprised when we pass a few back to you the public.
I have been asked to value properties where Nan is lying dead in her bed and you Jo public have called us before calling the undertaker.
If you don't like the home truths that our profession have to deal with, take your crusade and clean up a broken greedy society.
Who as it waiting for Nan to die early on in this thread?
Hi Guys,
I think jonny hit the nail on its head. He has NO VESTED INTEREST. ie NO house or money to buy a house unless there is a crash and mummy and daddy gives him a deposit.
Ace, I doubt very much that you could go any lower than you already are in the eyes of those on here with no vested interest.
Now you go run away little boy and leave this forum to the rest of us, I bet you've been running away all your life.
For the record, yes I do look at what people have to say on HPC, I also look at other forums, I'm also lucky enough to have honest conversations with a local estate agent, my sources are many and I keep an open mind to all of them, all EXCEPT YOU as you are a COCK!
Do you know who will use that £6bn of borrowing Austin?
Nope nor do I nor do they.As such yours is a meaningles post.
If it is used as remorts for a new Bentley or two that means no sales for agent.
If it starts 48,000 chains happy days!
How's that pimple Steven? Would you like it squeezed?
Do you know who will use that £6bn of borrowing Austin?
Nope nor do I nor do they.As such yours is a meaningles post.
If it is used as remorts for a new Bentley or two that means no sales for agent.
If it starts 48,000 chains happy days!
How's that pimple Steven? Would you like it squeezed?
dear editor.
can you please change the way you can post..as the sums i am being asked to do are getting too hard..
dear editor.
can you please change the way you can post..as the sums i am being asked to do are getting too hard..
Then in the real world they find out they have to pay 300k for a ex-council house...
@George Daws
"You might think yourself very very smart and are probably boasting to what few friends you have what a time you are having educating us thick spiv Agents but at the end of the day, we have heard it all before and despite all you say you will still look in the paper or look on rightmove to see what your old nan's house is worth and wish she would croak before prices fall to far."
you vile, stupid piece of sh*t
Hi Steven,
Is that a yes to you just sticking with Rightmove and jacking in the rest?
BW
S
My dear Austin,
I don't doubt that it is your honest opinion. Do you mind backing your opinion by informing us what your financial situation is? At the end of the day that is all that counts. I am sure if it doen't crash in 2011, then it will be 2012, 2013 and so forth until it will crash but by that time the market would have gone up 100%!
what did the stupid rich man say to the smart people (ala austin, elle, dan): If you are so smart how come you are working for me!
ere Gourmand How's your gout you fat git. Mr Shipside said I should give this spam botting another beating.
Ooops bugger forgot to change my name.
Come now Richie Rich, what were you taught at school….? Check your sources!
“According to Savills…” well they would be encouraging people to invest wouldn’t they, seeing as though they make money from property ‘investment’!
Here’s a good, INDEPENDENT source for you:
http://www.moneyweek.com/investments/property/uk/uk-house-prices-have-further-to-fall-10407.aspx
Here's a nice bite size info blast for you oh so busy EA's:
"For 2011 the Council for Mortgage Lenders – a body which is hardly keen on talking prices down – is forecasting net lending of just £6bn. That would be a staggering 95% plunge from the market peak in 2007."
95% plunge in net lending! Ouch that's got to hurt the commission.
All together now “Where’s ya volume gone, where’s ya volume gone?”
We all know 2011 is when the real recession starts and it should be very, very interesting to watch the housing market react to it.
Good Luck, you will all need it when the cuts really kick in; inflation continues to rise stealing disposable income from people who labour under record personal debt, with a government that is now £4 TRILLION in debt and cannot Quantative Ease anymore - the UK in a years time will no longer be in a position to control interest rates.
Inflation will erode some of the losses but over the next 3-4 years the market will lose imho 25-30%.
We are now entering the endgame for the UK property Bubble. Enjoy.
Well said George.
BTW Should we advertise solely on Rightmove or go with the local papers as well? We agree primelocation and zoopla are cr@p
Do you have any idea what prime Sea trout and Salmon fishing rights go for? I sell that too.
The only bloke in a bubble old son is you, educated beyond employment and so deperate for someone to spar with he resorts to us thick agents.
I can afford to sit here and spar with you forever I only need 11 days of a rising market to buy up another property. It doesn't matter if the market falls 98.9% that simply increases yields above 5%. Let me guess that you missed out on buying up the UK gold reserves when Gordon floogged it off too.
You might think yourself very very smart and are probably boasting to what few friends you have what a time you are having educating us thick spiv Agents but at the end of the day, we have heard it all before and despite all you say you will still look in the paper or look on rightmove to see what your old nan's house is worth and wish she would croak before prices fall to far.
Dear Dan,
I am afraid u r talking crap. I think u need to get together with Elle. U probably took 3 holidays a year and used my money and gourmand's as well to pay for your rental property. U missed the boat and blaming everyone who has worked hard in their life. I don't have 4 houses like gourmand, I only have one and still paying the mortgage but I aspire to be like Gourmand. Whereas u prefer to sit on your arse blaming everyone.
One thing I do agree with you, is that the government is taxing gourmand and I to pay for people like you and elle.
QED
Jonny, seriously?! I have lowered myself too far already by getting into these pathetic 'debates' (a total mis-ise of the word) with complete idiots on here.
This is a pointless exercise.
Why on Earth HPC brigaders continue to post on this site, I don't know. They HATE EAs. They do NOT want to use them. Absolutely fine.
In a nutshell...NEVER use an estate agent (they wouldn't want your business anyway) and cut all communication with them. Simple.
This leaves you to buy and sell (not that you have anything to sell) property freely and privately without involving the "parasites" that are estate agents. End of story.
That's it from me on this thread.
EEEE-YYOOORRR
@George Daws
You once again ably demonstrate we are still in an investment bubble, and fail to address my points.
Forces beyond your (very limited) comprehension will wash away your preconceptions and you will be left standing agog at the destructiuon of it all.
I do have respect for the fact that you say that you have investors waiting to buy property, again that fact - which I do not dispute - has an alternative underlying cause that you can not fathom - that this is speculative money.
It is a bubble and it is doing what bubbles do.
I am sure indeed that you do catch sea trout without having read extensively. I doubt you could ever make money out it however if you did not take it a bit more seriously, but of course hobbies are hobbies.
From a professional point of view, Your 'investors' are going to lose their shirts and it is going to be quite funny. I used to have more sympathy but then I came across people like you.
@wardy - care to inform your superficial argument with real-terms interest rates, and consider cycles over a 20yr+ period? Low interest rates have made some spectacular stockmarket buying opportunities these past 2 years, whilst houses have gone sideways. The fact that mortgage payments equate to rental prices falls down on about 3 points: (1) capital opportunity (do you know what this means? George Daws? any idea?) (2) physical asset depreciation (again, george, understand this?) (3) long term variability in interest rates, and (4) risk (IRs are low because the economy is in such a state, ergo we are all taking employment riskk). I DID save a deposit, I just invested it far better than I could have done so in property, at these prices.
Austin- Audi A4! don't so daft, my 18 year old son has one, please, there are standards, I would not sink so low as an Audi dear boy.
Go and do your homework and you will find the UK average Rental yield is 4.9% more than enough to pyramid their portfolios.
I have never read fly fishing by JR Hartley but it doesn’t stop me catching Sea Trout and Salmon.
You can guff backwards through linen pants for all I care about your college learnings. 5.6% in a month means property is going up at an average £12.50 per hour nearly £7 more than minimum wage.
My smallest landlord is earning £625 per hour for doing nothing. They can add another average property to their portfolio every 11 days. So when I say I have investors waiting to buy property, please have more respect for me than you have for yourself.
AceofSpades
Yes I am smart, smart enough to read and digest 100% of what is written on here and accept that everyone has and is entitled to an opinion.
My beef with you is that you are without question "full of shit", I'm tired of reading your constant drivel. I know your type very well, the only difference between you and a donkey is that donkey's don't eat shit!
Interesting thread, sorry I missed this one, I will put my 10 pence worth in though. Earlier post suggested that your lifestyle is greatly improved when you rent. I don’t buy that one, many rents here are the same as the equivalent mortgage, in fact many complain that they can’t save a deposit because all their income is spent on rent. I stayed in, saved and bought my house with a 10% deposit at the age of 20. Sad? Maybe? But I have equity so I’ll live with it.
I wish people would not use income multiples to back up the house price argument. Go and sit down with a descent adviser and they will tell you what you can borrow based on affordability. You can earn £100,000 a year but if you p**s £90,000 up the wall then you lack affordability. Unfortunately there are plenty of people who don’t go on the razz 7 nights a week and they WILL buy and buy at today’s prices.
Many doom mongers are predicting 40 – 50% drops. These people profess to know more than the banks? Even in risk adverse 2011 there are plenty of 10% mortgage products about. Doesn’t seem like they are predicting a drop, certainly not more than 10%.
and theres more!
Investors coming back to UK residential property market
News - Property
Written by Ray Clancy
Thursday, 03 February 2011 10:47
The proven long term performance of UK residential property and a 6% rise in average rents in the past 12 months are beginning to attract investors back into the market, where substantial opportunities now exist particularly for those with equity.
According to Savills Spotlight on Residential Investment report the current lack of debt funding for large, complex development schemes has created the greatest opportunity for residential investment.
Equity rich entrepreneurial property companies are taking advantage of this opportunity by either building schemes of sufficient scale to eventually sell on to institutional investors or teaming up in joint ventures with the institutions.
Keep renting and make others wealthy! Thanks I own a decent portfolio and adding to it to get your rent to pay for it!
Simples.
Sorry all you silly boys on here!
London house prices surge to the brink of an all-time high- souce Jonathan Prynn, Consumer Business Editor
3 Feb 2011 London Eve Standard
Resurgent London house prices are on the verge of hitting all-time highs just two years after the banking crisis threatened a "property ice age".
The EA is dead long live the EA!
George says:
"Non of my professional owners give a thought or a fig to the value of their portfolios. Individual prices mean nothing.."
Wow. You don't happen to have a list of their names and addresses do you? I have some rather attractive tulips they might be interested in.
Those who have piled in recently thinking they'd rather have short term yields rather than low returns from 'cash in the bank' are simply fools.
Watch as their capital is eroded and they realise that holding onto an illiquid, depreciating asset isn't much fun.
We'll see how much of a 'fig' they give then.
It's a pity that the average UK Joe doesn't really understand the fundamentals of economics and believe the myth - perpetuated by estate agents and the like - that you can't go wrong with property.
Shifting demographics, economic turmoil and resulting negative sentiment will soon blow that theory out of the water.
(Oh, and by the way, I'm an owner-occupier - not a wannabe FTB, embittered renting underclass, as some of you would imagine.)
"I don't know or much care for what fancy modern jargon you call my investors.
20 + years for some of them is not a passing fad, they have portfolios of 50+ properties at 4.9% yield that is better than cash in the bank. "
'fancy modern jargon' having been around since before you were born - don't tell me you haven't read any Graham or Fischer? Sorry but you are laughable.
4.9% yield? You are sh**ing me. That's awful. For p***-poor gross yields such as this in physical assets, that has to be a bubble. Laughable with every phrase you utter. Only a sheer fool would compare asset yield with cash in any serious way, they have different purposes. Still, thank all your 'investors' (I use the word flexibly!) for giving me a cheap rental to live in whilst their wealth drains away subsidising my lifestyle. It's a blast, really it is.
@ AceofSpades
"In my local area most houses are selling within 3 - 6 weeks."
Good for you; obviously bucking the trend there given the average is over 10 weeks:
http://www.hometrack.co.uk/commentary-and-analysis/house-price-survey/20110127.cfm
I don't know or much care for what fancy modern jargon you call my investors.
20 + years for some of them is not a passing fad, they have portfolios of 50+ properties at 4.9% yield that is better than cash in the bank.
The market is such that demand for rental properties is fueling investor purchasers of sub £200k properties.
This Shapps FTB summit simply will not address the fact that the UK society has to split into Buyers and Renters.
Non of my professional owners give a thought or a fig to the value of their portfolios. Individual prices mean nothing
What agents charge and what they earn after overheads is going to differ greatly. But yes charging a good fee does make a difference, there are jump on the band wagon agents based around my area, that cahrge ridiculously low fee's, you would have to do a large volume of sales to make a decent profit (or what I think a decent a profit would be)
I would rather sell less houses at a higher fee, instead of more houses for less of a fee as it, gives us more time to do other proactive things
@Chris
look at the price of a university education compared to 20 years ago; look at the income of an accountany or programmer compared to 20 years ago, competing against cheap indian (etc) labour . It's not all positive.
Look at the endogenous effects of high long term retiree dependency on the state, look at the ration of earners to dependants and where that's going over the next 2 decades. Look at interest rates in real terms.
Interest rates were dropped in 2005 for labour to win the election; the housing market was bailed out by labour again in 2008 in order to try to win the 2010 election. Now the cupboard is bare.
the 2000s, owing to real low interest rates and nice demographics and a corrupt government, were very benign for property prices;
My view is that this decade and even some of the next, will see a reversion to the mean, a large fall in real terms house prices. Fact is, nobody has the money to prop up house prices at these levels, and the government is no longer going to provide it via long term low interest rates.
The bottom line, Chris, is that you simply don't understand basic finance, and you got lucky for a while. Well done, neither did Gordon Brown.
http://rocketspage.wordpress.com/2010/12/28/1561/
http://www.thestudentroom.co.uk/showthread.php?t=1500852
http://www.guardian.co.uk/discussion/user-comments/Dissavowed
http://www.newstatesman.com/blogs/the-staggers/2010/09/secretary-mandelson-former
4 of 53 places where " Daniel's" post has appeared
Ctrl C Crtl V doen't make you a scholar Dan! You a simply a fraud. .
I have been through the stock of washed clothes I send to the third world Dan. I do have a pair with Dan1el written in blue biro on a school tag label. They are quite unique, lime green, DanZa Cock pants. If they are yours I will send them on , The heavy protein stains are still quite apparent but I guess having these will save you spoiling another pair!
HD
Thanks for the response. Yes Joe Public’s appetite to buy and borrow at every reckless levels is not soley your profession’s fault but a lot of your colleagues have played on people’s naivety and utter desperation. Yes it is your job and quite rightly so in a commission environment the onus is to sell and sell quickly. I am just a little shocked that so many EAs are as equally ignorant as the public they sell to about the state of the market and how it has been and will be stemmed by wider economic issues. There will be a lot of people who brought in the last 3 or so years who have been utterly mis sold – many of my friends have befallen this: 100% mortgages, buy to letting so they can load up with another property and be hampered by two depreciating assets.
The low volumes will hopefully remove the less scrupulous among the profession and leave, as you say, the people who do it the right way.
In all seriousness does the increase of commission rates a couple of points to say 1.8% really cover off the drop off in volume. Surely for you guys it is better to be selling 4 houses at £250k than it is to sell two at £325k and spend way long marketing it?
Sorry to label you as ignorant it is just frustrating that property ‘bulls’ never address the implications of the economic conditions.
@Dan1el
You said: (The UK median Household Income is one way of considering affordability.)
No it's not, the two are not linked in the way that it once was! What you haven't factored in is globalisation and the price of goods relitive to you income! It's not about income, it's about affordability on it's own, period!
Look at the price of a TV compared to what it was 30-years ago, look at the price of a car compared to what is was only 20-years ago, look at how low interest rates are to where they were in the 90's.
The banks have had their fingers burnt with money backed securities and have now lost their route to obtaining cheap money. The cheap money has run out and now they are limping along, barely solvent.
What makes me laugh is the house price crash brigade were telling buyers to wait, a chrash will be along soon enough when the bubble eventually busts. Okay, when it eventually happened, a decade later as it goes, they were eventually right, but for those that took their advice and didn't buy, they are equally stuffed now aren't they! The doom mongers thought that people would just wait for prices to fall on their own and everything else like the banks, would be the same, ever willing to lend money, but they were wrong bigstyle.
I bought two Buy-To-Lets in September 2007, the very peak of the property bubble. Am I sad that I bought and that my two properties are worth £20k less? (Each) No and here's why. Obtaining BTL mortgages was simple & cheap with no setup fees, inerest rates fell so that my profits increased, demand increased and my rents have risen and yesterday I put one of them back on Rightmove because the tenant now needs a bigger house following the birth of another child and in 24-hours, I have received 8-enquiries/ possible tenants. All but one is under 30-years old.
Okay, I have made a paper loss, but as I im not selling, I have lost nothing and I am still making £500 per month on each property! Not bad when I only put £5k deposit into each one. Tell me where I can make £12k a year from an investment of £10k these days!
Even if tenants dry up as they are all out buying, as long as the house prices are shooting up again, I will be gaining equity even if they are stood empty, as long as I can cover the mortgages, that is. It's very hard to lose if you own the right property!
Okay, my daughter is doing her A-levels and she is going to find it hard to get onto the ladder over the next few years, but there isn't a god given right to buying your own home and she may be forced to rent for most of her life. It works for the Dutch, French or Germans, so why not her?
As the government can't house everyone, the banks don't want to take risks with first time buyers and tiny deposits, maybe the government should lift capital gains tax on BTL, banks lower the interest rates on BTL mortgages so that they are in line with residental mortgages and perhaps this recovery can be led by BTL investors expanding their portfolios. After all, that is where all the spare money is. Lets move this country towards the mainland European model, where people rent for the first 20 or 30-years of their life and think about buying later when they are more established in their jobs with big deposits behind them!
Q.} What does every single FTB'er in this country do, before buying their first house?
A.} LOOK ONLINE
And which website received over 78,000 page hits EVERY DAY?
Mmmmmmmm?
Game Set and Match
[Clues in the name]
@George Daws
"There are 20-30 investors waiting to buy anything that even sniffs at a bargain. "
that's what they said about dotcoms, tulip bulbs, south sea bonds, 1920s NYSE shares, etc etc
what you are describing is not underlying demand, it is speculative sentiment-led demand, confirming to me the market is sustained by sentiment and speculation is hardly undermining my notion that it is not sustained by underlying need
sentiment is a fickle thing, speculators/investors will probably move on to the next mania just as they always do
as an aside, my beef is not with EAs per se, of course they do a valuable job bringing buyer and seller together; my beef is with the irrational market we have suffered this last decade. But as I said, it is coming to an end.
Firstly Austin, I am not ignorant, im anything but, but I will let you have your view.
Even if some agents may have ramped the market up, I think what you find it hard to understand is, that no-body has ever put a gun to anyones head and made them buy a property. It is the buyers choice to buy somewhere.
Some Estate Agents have gone out of business, that as many as originally thought though. The agents that do 'extremely well' are people who have a good business model, good customer service and great advertising (these of course are only a few things). And with falling transaction levels the ability to charge a decent fee rather than do it for peanuts, is the reason most of us stay in business.
Austin, Please, when you post, keep it short and sweet, I've not got time to fish through that enermous portion of jibber jabber. I've not read half of it.
Catch up, sales are down from the peak numbers - what do you think agents have done between now and then? They have all adjusted the set up and procedures in relation to volume.
In my local area most houses are selling within 3 - 6 weeks. Volumes are higher than last year by a noticable amount. That is performing extremely well.
Do everyone a favour, including yourself, jog on and stick to private selling sites. Why even bother with agents? You hate 90% of them - you don't have to communicate or deal with them, yet you choose to come on this site?! Get a life.
What is the VERY BEST thing you are hoping to achieve by posting your long drivel on here? What are you hoping for.
Right now, nobody is taking you seriously, they;ve heard your points and they are biased, boring and tiresome.
Ha ha brilliant HD, brilliant. How to conform to everything that has been posted about EA’s ignorance to the market.
How can you advise client’s purchasing if you are that ignorant, oh wait you don’t because all you are able to communicate to client’s is one of two things, ‘never been a better time to buy’ and ‘great investment potential’.
PS How can the banks loosen lending criteria when a) they now what is approaching, hence why they want big deposits to limit the exposure to the market falling long term, b) they don’t have the capital to lend to people. Just so you know – 2/5ths of available mortgage lending was in the form of MBS products of which the market has disappeared. Just under half of all mortages in 2008 were self cert aka ‘liar loans’, these mortages were needed for a reason as the gap between earning and house values have grown too wide. With increased unemployment and at best wage stagnantion in an inflationary environment there is simply no where left for Joe Public to pay for ever increasing property prices.
I do think that but EAs (not all but many) ramped the market to an insane degree – their actions, particularly when the market lost its steam in 2008 – were the actions not of a profession but of a desperate breed. Leaving Sold signs up after SSTCs had fallen through and properties had gone to rental, leaving sold signs up when properties had been remortaged as let properties by the existing owner, putting up signs outside block developments saying last few remaining when very few properties had actually sold, Selling utter mis truths about the potential of the market over the last few years – anyone with a modicum of sense can see how over cooked the market is. Encouraging people to take wholly irresponsible financial risks in order to not ‘miss the boat’.
Certainly your ‘profession’ will under go a mass cull of the piss poor EAs that have given your industry such a bad image, the old beasts who have been through the late 80s/early 90s will be ok – you may well be one of them – but a lot of the people entering Agencies of the last 10 years have got a brutal welcome to reality.
If agents are doing ‘extremely well’ why have transaction levels fallen by around half?! If my oppurtunities to earn fell by that much I would feel it – I take it the estate agent offices around Harrogate that are empty (never open on Sundays now) and closing is an indication of a sustainable market?
I suggest you also download the Property Bee programme as the houses I see on Rightmove are all being cut in price!
I am not the big ‘online’ I am, as you put it, I am merely pointing out the drivel your profession increasingly comes out all whilst the inevitable fall back in the market occurs.
I would have no hesitation in not dealing with your profession – 90% of EAs I have come into contact with have ridden a bubble and are pathetically organised, have poor selling skills and an utterly deluded approach to the market in light of the huge economic issues being brought to bear on the UK. Delusion that I shall enjoy watching as you encounter the irony that without drops your volumes and resulting commission becomes harder and harder to maintain.
If you would like to corralate the hear say of your assertion that the market is doing ‘extremely well’ and that houses are ‘selling at the current rate’ with the massive drop in transactions and time to successfully market a property that would be fantastic.
I will address Dan1el's post from this morning, its boring. Done.
Lets us assume you smart chaps are right and every single estate agent goes out of business. What does the post estate agency world look like?
who exactly is going to deal with people changing where they live?
will all properties be the same price?
what wil happen to the people in the properties that you want to occupy?
what happens when someone won't move out of te property you want to buy?
Lets ignore all the practical stuff, and now imagine that every bedroom in every house is full but there still some peole left over (over supply in economic terms) what happens now?
When you fellows banging on can answer basic socioeconomic questions you might gain a little bit more respect than any of us have got for you.
Austin,
If you genuinely deep down in that lovely heart of yours, believe that EAs are solely responsible for pricing of current proeprties and the market as a whole, you are STUPID.
All of the local agents are doing extremely well at the moment. Why would they or their sellers reduce prices when they sell at the current rate?
Why don't you save your energy, stop giving it the big 'online' I am and just cut agents out of your lives and never communicate with one again? There are a few private buying/selling sites that you can focus on. That would suit agents a great deal and it might even bring some joy to your own life.
What delusion from Richard.
You are being a stereotypical EA – you know and understand nothing about the wider impact that economics has on the housing market nor even know the basics about your own sector – Transaction levels have been around 100k-130k up from the early 2000s to 2008, they are now around the 50k – 70k mark with transactions falling back over the last couple of quarters as the supply of credit contracts again.
One month in January at your place – bet you spin that line at all your viewings. You know game over is approaching – those easy buy no or pay later, 100% mortgage purchases are over.
As for a 10% jump in sales volumes that would give you around 70k transactions, whoopdee wooo – well short of the average required to keep you lot in A4 convertibles. You will only get a jump in transaction levels when the credit available is matched to the amount people can realistically borrow given their earnings.
I suggest Richard you frequent yourself with wider reading around the economy because living in your Estate Agent bubble will put you out of business; property isn’t a one way ticket and let’s face it the skilled and knowledgeable Estate Agents will survive the ones who rode the bubble will be forced out of work, time is running out Richard to wise up.
I can only speak about my individual market, I am paid by vendors to reflect what the market is doing up or down.
January showed a 5.6% in my FTB stock. £200-300,000 no change and a few transactions. £300,000 - £500,000 down10-15% Big Stuff with Land deends on the buyer.
The price crash simply isn't going to happen at the bottom of the market around here. There are 20-30 investors waiting to buy anything that even sniffs at a bargain. Am I a Bastard , Dickhead etc for doing a professional job by getting the best price for my client? They don't think so, the sucessful purchaser is happy, 5 couples who were not sucessful don't think so either.
In over 20 year in the business not one person, vendor or applicant has ever made a complaint about my dealings with them.
George Dawes said
"I am and Estate agent and will happily comment on Dan’s post."
You have not addressed one point from Dan's post.
Have you?
Look more waffle........
Actually Elle, Squirrel said he thinks you are nuts there is subtle difference between that and calling you nuts.
I think the Mona Lisa looks like David Walliams in drag is different to saying The Mona Lisa is David Walliams in drag.
We all worked out what you were trying to say yesterday and worked what sort of girl you are. You shouldn't feel pressured into conforming and in these enlightened times that pressure must be self imposed. It seems that anything goes. Personally I remember a time when a Lady wouldn't talk unless spoken to and certainly wouldn't have posted obscenities and abuse for fear of being thought a Harlot.
@George Daws
"In order for property prices to drop there has to be a motivator that creates over supply. There is no motivator. "
there IS a motivator (sic) as you put it - the price is too high, and you must agree that the most basic pricing signal in any market is, afterall, the price? do you? Altho' granted negative real interest rates will soften negative price pressures for some years, do you really think interest rates, in real terms, will remain negative for the medium term? Reversion to the mean, as a principle, hangs over this whole market like a shadow.
@Richard
January sales volumes appear to be up, indeed, this commonly happens in the new year
are your figures seasonally adjusted or simply, as I imagine, extremely selective? Do you understand seasonal adjustment, out of interest?
dream on, your delusion is being popped as we speak
I am and Estate agent and will happily comment on Dan’s post. I didn't before because it is plagiarised rubbish
In order for property prices to drop there has to be a motivator that creates over supply. There is no motivator.
Interest rates are a fraction of what were used to paying.
Most people who have owned property for 10 plus years have simply been using the fall in interest rates to pay off the capital owed. This reduces their interest liability if interest rates hop back up to 10%.
Some borrowers have reduced the term of their mortgage by over payments as a result of low interest rates. They have the option of simply extending their term to the full 25 years.
A huge % of the population has no mortgage at all.
So where is the supply of property coming from? Death or Repossession (builders can't borrow money to increase the supply of new homes)
People 20-38 years ago didn't think, not tonight dear in there will come a time when our offspring can't get a mortgage. There are simply too many people for the number of properties available.
You can try to talk prices down if you like but there is such demand for property that prices increased here by 5.6% in January
That raise added £1850 to the deposit required for the average house in a month. There were 6 people chasing our repo each had saved the 20% deposit required. You boys are missing out!
All very funny! Transaction volumes have been at or about this level since end of 2007. If you are sitting waiting for mass closure of Agents, unlucky! Bad news for you gloom hopers, January was a stronger month, more interest and more sales, so completely against your expectations..
Sorry! For all you “Economists” what effect would a 10% increase in sales volumes have on the economy??? Now that would be positive so no doubt you ignore that. Don’t forget bad news sells newspapers, you won’t see good about the housing market will you?
Just keep paying back your student loans and those “green eyes” can look forward to nice cars and homes, but for now keep moaning along!
so to summarise the comments section from a bearish perspective:
Under 30s would like to own, but they cannot afford to, and banks cannot afford to lend them the money. So they won't and prices will continue to crash.
The vested interests don't like this and come up with spurious arguments as to why 'it's different this time', apparently because of how hard they worked or something, and house prices aren't in a bubble after all and it's all to do with inheritance etc.
Don't matter, if it walks like a bubble, and quacks like a bubble, it's a bubble. The squirming VIs only make it even more evident, this is part of mechanism, and amusing to boot. All the under 30s I know are waiting for prices to crash, yeah they want to own, but they understand patience too, and rentals are currently competitive if you do your homework (another symtpom of a speculative asset bubble - low yields). It's been fun, guys, and it's going to be even more fun watching this thing burn to the ground. Enjoy.
Very interesting that no Estate Agents have dared address Dan1el’s post at 2011-02-03 9.40am
If your bullish dreams of an ever increasing housing market had a modicum of reality about it you would be able to respond to it.
Your era of ramping property is over, like the cheap ponzi credit keeping prices going up yoy.
Please address his post, would love to see an Estate Agent tussle with the impact of macro economics on the housing market.
Hope you are all enjoying the awful volume at the moment as well, ah the irony of your situation now; if prices don’t drop rapidly you won’t get the volume of transactions back and more and more of you will go out of business. REALITY has just made an appointment with all of you EAs.
Chuckle!
http://www.youtube.com/watch?v=Fu8pIeeoZcg&feature=fvwk
To all the bitter souls who post here venting their spleens at Estate Agents, I have a message for you.
Current house prices levels are not - repeat NOT - the "fault" of Estate Agents. You are barking up the wrong tree; banging the wrong drum; shooting the wrong messenger... the list is endless.
Blame ME instead. Me - and around EIGHT MILLION other sellers who have contributed to it over the last decade or so. We asked for it - others were prepared to pay for it - so blame them also. That's around SIXTEEN MILLION to apportion the blame over - not just a few thousand who only do their jobs. And they never forced ONE PERSON to buy or sell - so surely they are completely free from blame here and should therefore receive massive apologies from you all for the shocking treatment you continue to subject them to.
Agents were simply the facilitator - yet you despise them as if it were their money and property that was involved here. I am sure that within the timescale, some Agents actually did sell or buy a property for personal consumption - but not enough to affect the market so strongly as to warrant your ire.
You seem to believe that because they take a minute portion of the proceeds for performing their duties successfully, that they are some form of hideous carbuncle on the bottom of humanity. Do you post this drivel all over the Tesco website whenever the price of your weekly shopping goes up (that would be weekly - REGARDLESS of the financial climate...)? HAVE YOU SEEN THE PRICE OF GRAPES?? They doubled before Christmas (the old supply and demand law that governs the price of all things - property included...) and STAYED THERE! I suppose they will go up further again now that Egypt is in turmoil... Which website do you recommend I post my complaint?
So come on - call me all the names and more. my shoulders are broad - and I can apportion the percentage of your diatribe to me and the SIXTEEN-ODD MILLION others - so I won't feel a thing.
Go on - knock yourselves out... You can have the first punch on me!
So I get called 'nuts' and not one person actually understood what I was trying to point out.
I never said all these people surveyed viewed exactly as me, I was suggesting that 'perhaps' they answered because of the reasons I was discussing yesterday, having seen friends and family rush around me trying to do 'what is expected'.
Well, what a horrid forum to have got myself involved in, My first post, where I am sorry that I felt I had something to share has been attacked and I am being insulted by being called 'nuts'
I'm not sorry for myself here btw, I just don't like bullies.
I had a view but it didn't sit with some people here, so as you have done I will judge you on your opinions:
a bunch of arrogant, bullying arseholes.
EAT - what an unpleasant bunch you attract.
Dan if the picture you have painted to the world of your life is true then I predict you will be famous .
You will pobably take half a dozen innocents with you but they way you are going on the nastiness will either eat you alive or you will go on a killing spree.
Get some help!
Interesting site though. Will certainly have to post on some other posts on here in the future.
:0)
Byesy Bye....
Never once said I was student.
[Did I dickhead? Learn to read]
Average age of FTB is 38 years old.
Toodle pip for now. Ta Ta..... :0)
P.S if you had put as much effort into your coursework as you have here recently you might have a decent job.
Don't blab about anyone nicking your money, Social security handouts are simply a short term loans from society with no interest burden, it isn't your money it is mine and despite your nastiness loaning you a little bit each week is a small price for keeping you firmly in your place.
Please think of it in more positive ways, (it might help with your anger) £70 a week plus a roof over your head might not be a wonderful life but at least the hours are good!
Waffle and bullshit in response I see.......
Not surprising as that is what you do for a living....
Bye Bye.
Dan1el, Have you ever kissed a girl?
Your copying and pasting of biased points, that you believe are boring us all.
The market has changed - you missed the boat for your bargain, ridiculously cheap houses 12 years ago.
It's like The Sopranos, it's over. Find a new show and get over it.
I might be a Dipshit , but you and some of your generation are in deep shit.
You can rant and shout are loud as you like. There are them that have, them that haven't , them that know and them that don't.
Be content in the social housing I am paying for, be content with the Social handouts I am paying for be content with the education I have paid for.
I am not angry that you have gone though 14 years of education and still as thick and socially stupid as you are.
Please feel free to protest, I am paying a police force to protect us both.
I am a rich smug bastard because every time a drunken student shit his pants and left them on the floor. The banks, building societies and Landlord who provided that shelter paid me £10 per shitty pair of pants to put it in a bin bag.
Have the banks and building societies robbed anyone? No! they have simply had to pay people like me to clear up after people like you.
If 1 pair of shitty pants takes 10 seconds to put in a bin bag go calculate how much I was earning per 8 hour day.
Elle - You assume they follow the 'done thing rule'. That is YOUR ASSUMPTION. Look, they were asked their opinions, they gave it. There is no disecting required here.
Jonny - Obviously a smart, lovely guy.
Dan/Daniel - There are still a noticable amount of transactions going through, these are lower than the peak periods, of course. However, if all of the SUITABLE mortgage applications that are being rejected, were actually accepted, I think you would be walking to your nearest cliff as this would see a general price increase, with a lot more competition for property. More people want to buy in this current market, than the numbers that actually are buying.
WHY are estate agents still in business (if they are the parasite that you suggest)? Only a STUPID person would continue to use them if they genuinely thought this. But yet, the profession still exists.
WHY are the private selling properties priced in line with current prices listed by agents?
The World owes you NOTHING! You used a P word earlier, that seems to be very descriptive of yourself. Oh the irony!
Last question, if you hate EAs so much and will never do anything, what is the point of you viewing and posting on this site? Like someone said earlier, you could get a second job if you can't afford a mortgage, rather than waste time on here.
Spot on Neil Robinson and Gourmand.
This forum is for people to discuss the topics in hand. Its not for bitter first time buyers to come on here and bang on about lending criterias of old, the market has moved on.
Its also not a place to come on here swearing and insulting people. To all you doom-mongerers, no one really cares what your thoughts are. There is the very well known HPC website for you guys to vent your issues and bang on about how the market is going to drop.
I am all for the market to start moving at a better pace and see some more FTB come into the market, but it is what it is now, lending criteria is much more stringent, and until the banks loosen up a bit, its unfortunately like it or lump it.
[Nationwide Building Society figures]
From 1987 to 1997 the Average House Price rose from £40k to £55k.
A 33.3% rise over ten years.
From 1997 to 2007, the Average House Price rose from £55k to £190k
A staggering 245.5% increase over the same period. [Ten years.]
Why did this happen?
1. “In America, the Glass-Steagall Act had protected deposit-taking commercial banks from the risky activities of the investment banks. Congress was effectively obliged to repeal the Act in 1999 because New York was losing its business to London, which had no such restrictions and the “light touch” regulation encouraged by Gordon Brown. Had Britain [Brown] enacted similar legislation to Glass-Steagall, the US Act would not have been repealed, the City would have made less money but the banking collapse in both America and Britain would have been avoided”
2. Complete failure to build social housing. Labour built , an average of 26,000 fewer homes each year between 1997 and 2009. Under Tony Blair and Gordon Brown, the country witnessed the lowest level of house building in peacetime since 1924
3. The tripartite system put in place by New Labour to regulate the economy was a direct cause for the financial crisis.
Lord Vallance, chairman of the House of Lords economics affairs committee. [Tasked to look into the causes of the Crisis]
* “It is clear that in the UK the tripartite authorities of the Bank of England, FSA, and the Treasury failed to maintain financial stability, in part because it was not clear who was in charge in a crisis and because not enough attention was paid to macro-prudential supervision – oversight of the aggregate effect of the actions of individual banks – in the period when ‘boom and bust’ occured.
4.In his 1997 budget, Brown abolished dividend tax credits on pension funds. Companies saw the writing on the wall and immediately ended their final salary pension schemes to new employees shortly after the ‘Brown raid’.* The value of pension funds have since lost around £5bn per year since the 1997 tax relief cuts. Pension funds holding the cash that almost everyone in the country had planned to use for our retirement have lost around £100 billion over 12 years. [1997-2007]
The advice Brown was given by this Treasury Paper, in 1997 was as follows:
‘The changes in incentives are likely to lead to substantial changes in portfolios. Pension funds will find equity relatively less attractive, and will prefer other assets – particularly interest bearing securities and foreign equity – and may also be prompted to consider more direct property investment.’
This was ignored by Brown. Those funds were then channelled into fuelling an unsustainable property bubble, {Buy To Let portfolios,} which developed because of Labours complete lack of regulation of the Banks.This was followed by rising house prices, ever increasing toxic mortgage debt, and this was followed by the bank bailouts.
Roughly 60% of houses historically acquired by First Time Buyers, were then acquired by the Buy To Let brigade. This figure rose year on year, from 1998-2003.
FTBers were priced out completely.
This is just one example of Gordon Browns incompetent decision making which helped to create the cornerstone of the debt bubble.
5.Brown had every opportunity to face the problem. Instead in 2003 Brown switched the housing inflation figures from RPI to CPI, hiding the debt. [Much the Same thing he did with PFI.]
THESE are the reasons house prices rose to astronomical unsustainable levels.
Without the bank bailouts, house prices would have crashed by 60% plus.
So the only reason they have not crashed is because of Government theft of our taxes and QE.
So the theft of the future generations taxes, and the devaluation of the pound in our pockets, via QE, to pay for this toxic mortgage debt, Is In effect, forcing us to pay for others houses, whilst keeping house prices massively overinflated, ensuring we can never afford our own house. A debt transfer has taken place.
We are working for nothing. No capital. Forced to waste tens upon tens of thousands of pounds in rent.
Paying off a parasite liar loan landlords mortgage.
If this had not happened, millions of us would have got onto the ladder ten years ago, and likely paid off most of our mortgage.
We need to tax the parasites in our society.
Tax BTL. This MUST be done, because after the house price crash, BTL must not be in the position to simply snap up FTB properties again.
Raise CGT on second Properties. Dereg planning. Greenblet/Brownfield sites. Bring land prices back down. etc etc.
By 2015 there will be more 'voters' priced out of housing than those facing negative equity UNLESS a 50% housing crash occurs....
"This world owes none of us a thing"
How romantic. How poetic.
~and yet:
How many could afford their own houses if they had to buy them now? No-one.
Without the bank bailouts, house prices would have crashed and reverted to their long term median average affordability of circa 3 - 3.5x salary.
But instead of a return to a 'free market' future generations are having their money, via taxes and QE, stolen [by policies implemented by Labour], to pay for this toxic mortgage debt.
Thus Keeping houses massively overinflated, ensuring we can never afford our own house.
Its Complicated thievery.
My money is being stolen, by my government, to pay for my neighbours house.
When you understand the 'bigger picture' and you see it was undisputed fraud behind the manipulation of rising house prices.
You realise there is no point in working for another decade for nothing. No capital. Forced to waste tens upon tens of thousands paying for someone else's retirement, and bankers bonuses?
Wouldnt a fairer democratic balance be that my neighbour loses tens of thousands off the 'fake' valuation of his house?
Just as we have already been forced to waste tens of thousands in rent as year after year house prices have risen further and further out of our reach?!
A debt transfer has taken place.
[Polite language for THEFT.]
Without the bank bailouts house prices would have crashed by 50%-60%.
A return to their long term average affordability.
For you to win, the rest of us have to lose. [Because of Labours incompetence Theft and Cronyism.]
If my money was not being STOLEN, we would have returned to a free market, where I could buy my own home, for 3x salary.
Just as you homeowners did, yet, you homeowners, now expect me to pay for this toxic mortgage debt, in effect, to pay for your house, so I remain in debt slavery?
I KNOW THIS IS DIFFICULT FOR YOU TO UNDERSTAND GOURMET, WHICH IS WHY I AM SHOUTING.
KNOW YOUR LIMITATIONS. YOU ARE A DIPSHIT.
:0)
Walk into a bank or building society then Dan, tell them what you are earning and see what size mortgage you can get.
Ask them why you as an angry young man cannot raise enough mortgage to cover the 25% of the average UK property.
I am a bloated parasite with 4 houses and gout through drinking too much expensive port. I have so much money I couldn’t possibly spend it all before I die. Why am I so disgustingly rich? Because I worked harder than everyone else in my class. I have shovelled human waste off carpets in repossessed properties; I have cleared up properties let to students with toilets un-flushed for months. I have been so badly bitten by fleas that my legs bled.
I am proud to be called a parasite because having to fortitude to clear up after you and your kind has made me a very wealthy man. Despite all the crap and filth I have had to deal with in my working life I could get in the bath and come out a cleaner and better human being than you.
This world owes none of us a thing, our society does not owe you an education or house to own. Get over it and get on with it.
Watched a programme the other day about a worm which makes its living by living in the anus of another animal. This is what is called a parasite. As usual you ninnys have not addressed a single point. I dont feel the need to engage with estate agents. You are the last people first time buyers should be talking to. Its over. The bubble is going pop. The only question now is whether it will deflate slowly over years, or suddenly go bang. Good riddance. How many of you are still lying to everyone you talk to? 'house prices will never go down'.
If you nan or your parents property drops by 60% what happens to the inheritance you were hoping to share with brothers and sisters to get a deposit?
Doh!
Income multiplers aren't used any more, it is all done on affordability. Even if you are earning £200,000 a year the bank will only lend you based on £105,500 which is all you have left after tax and NI. If your bank history for 5 years is showing a spend of £100,000 a year they will lend you money based on what you have left over.
£5k pays for £125,000 interest only borrowing at 4%
You need another £415/month to repay your loan of £125,000 over 25 years so the banks will look at you and quite sensibly tell you to bugger off. Even though you earn £200K you will not get a £125k mortgage.
Use the internet for something more than trying to whip up a peoples revolution you nit, As well as porn there is learning on here too
Unfortunately for you its all true........it was a huge bubble......should never have happened.......without the bank bailouts house prices would have reverted to their long term average.......60% reductions which simply takes them back to historic average affordability.......wete on every student blog, housing blog, etcetc. Will reach hundreds of thousands of ftbers.......game over....lololololol
Please return to the clinic Dan, you are not ready to go out into the world yet.
You still have much to learn, Wolfy Smth is not real.
Get a second job instead of posting bollocks on a website and you will soon own your own home.
If you worked all that out for yourself, get help.
If someone taught you that, get your money back.
How many could afford their own houses if they had to buy them now? No-one.
Without the bank bailouts, house prices would have crashed and reverted to their long term median average affordability of circa 3 - 3.5x salary.
But instead of a return to a 'free market' future generations are having their money, via taxes and QE, stolen [by policies implemented by Labour], to pay for this toxic mortgage debt.
Thus Keeping houses massively overinflated, ensuring we can never afford our own house.
Its Complicated thievery.
My money is being stolen, by my government, to pay for my neighbours house.
When you understand the 'bigger picture' and you see it was undisputed fraud behind the manipulation of rising house prices. You realise there is no point in working for another decade for nothing. No capital. Forced to waste tens upon tens of thousands paying for someone else's retirement, and bankers bonuses?
Wouldnt a fairer democratic balance be that my neighbour loses tens of thousands off the 'fake' valuation of his house?
Just as we have already been forced to waste tens of thousands in rent as year after year house prices have risen further and further out of our reach?!
A debt transfer has taken place.
[Polite language for THEFT.]
Without the bank bailouts house prices would have crashed by 50%-60%.
A return to their long term average affordability.
For you to win, the rest of us have to lose. [Because of Labours incompetence Theft and Cronyism.]
If my money was not being STOLEN, we would have returned to a free market, where I could buy my own home, for 3x salary.
Just as you homeowners did, yet, you homeowners, now expect me to pay for your house, so I remain in debt slavery?
Understand this. This is the growing point of view of people who are priced out of housing.
Your First Time buyers.
Property is Theft. And we will win.
:0)
At the risk of sounding like an old fogey, it's no wonder young people can't "afford" to buy houses these days.
As recently as the early 2000s, renting was seen as something you did when you couldn't afford to buy, and it was easy enough to save up a deposit when you lived at home with your mum and dad. You simply put aside £X a month which gave you a nest egg, but also had the added benefit of teaching you how to budget, and not blow all your wages.
Nowadays, however, boy meets girl and they're down the estate agents finding houses to rent. The rent they're spending is money they cannot save up. What they're paying in bills, is money they would otherwise be paying to their mum in board.
Say you're earning about £15k per annum - it should be easy to save £500 a month if you're living at home. This is six grand a year - save up for only TWO years, maybe three and there's your deposit.
But no - I want it all, and I want it NOW seems to be the mantra these days.
Why don't barratts simply reduce their prices and increase building. Instead they want irresponsible lending to return to prop up their over priced extra small homes.
Barratts = vested interest spin
This is getting out of hand, please stop! said the actress to the bishop!
Dera Santa
I know it a bit early but i though if I got in early this year you might bring me wot I asked for instead of some Ninja Turtle outfit (I am not ungrateful or nuffink) but it was the wrong size....
you know I'm not steven, like everyone on EAT knows Ithe real steven is a trolling nitwit.
I totally agree with Ace. Elle has a 'partner' not husband as you can see. She will be one of those that when in her 50s will blame everyone for not being able to owna house bcos she wante dto go on holidays etc.
This is getting out of hand, please stop
I suspect Elle won't have any idea what one of those is Jonny.
Elle that was the opinion of 43% of those surveyed, not me not the forum, not anyone to do with EAT.
Nearly half the population under 30 think they want to own a house before they get married.
Go onto your local High Street and give 4 in 10 of that generation a damn good talking to.
100% of the people writing this post think you are a bit nuts. 100% of you disagree, please respect other people's opinion if they don't agree with yours.
Advice required.
Should I continue to advertise in the local newspaper? I feel it is a waste of time as Rightmove is bringing in a lot of the leads.
I already stopped advertising in findaproperty group and zoopla and this hasn't affected my business at all. I think Rightmove is all that is required.
Elle
Don't pay any attention to Aceofspades, he's a complete dick head!
Aceofspades... and who are you to judge peoples choices of how much they post on here?
And it is evident you aren't reading the posts as you will clearly see my last paragraph states:
"Each to their own and I do mean that; my main bone of contention lies with the snobbery and expectations placed upon young people today and it astounds me that this generation are still living in the shadows of 'it's the done thing'. This article proves just the snobbery I mean – first paragraph – “...and don’t want to settle for long-term renting”. Settle? As if renting is any less...?
Perhaps make sure you read the posts before attacking them. My point remains that I beleive people views are such because of pressure in society. That;'s the point I was making. I'll be sure to make sure I agree and have no opinions whatsover next time I decide to visit this website. Having recently visited this site more and more, I'm eager to go already because it's clearly if you don't think the same as some of the regular names on here, it seems you are not worth your say.
While you are there, could you post the rules for this quick fire forum BOSS? get off your high horse.
Elle - who are you to judge people's views, ambitions and wants in life? The poll asked the question, they simply answered. If someone is "not happy" paying rent each month of the working life as they would prefer to be contributing to their own mortgage, then that is their prerogative. End of.
Dan1el - So what if it has jumped up, EVERYTHING else has - Petrol has doubled in 3 years, God knows what it has done since 1997. This is an essential purchase to the majority of the population, but there is no rule to follow.
Owning a property is a privilege, NOT a right.
There are still many mortgage applications on a daily basis, however, not enough are being approved - that is a FACT. If all "reasonable" applications were approved, we would be seeing a busy market place.
Guys - this is a quick fire forum, why the extreme lecture? I couldn't be bothered to read half your posts, like many other I am sure.
Simple solution (which will happen anyway)
Increase interest rates to 5%. Might as well, industry is not borrowing and that's what it was supposed to help. Banks are making huge profits anyway as mortgage and loan rates are more akin to higher interest rates. Would start to control inflation which is adding to house price deflation anyway.
This will collapse prices back to the long term average, a reduction of about 50%.
FTB's can then afford to buy and we all get on with our lives.
Simple.
Makes me sick that a bunch of builders, charging far too much for their poky, now officially the smallest houses in Europe, cloned designs with no local flavour, want to encourage young people to become massive debt slaves so they can line their greedy pockets.
In 1997, according to the Office of National Statistics, the national average wage was £16,666.
According to the Nationwide Building Society the Average House price in 1997 was £55k.
£16,666/£55,000 = 3.3x salary [mortgage]
* The Average First Timer Buyer mortgage in 1997 was just £41.5k [Council Mortgage Lenders]
By 2007, at the peak of the boom [according to the Office of National Statistics] the national average wage had risen to £23.5k
The Average House Price in 2007 was £185k.
£185,000/£23.5k = 7.8x salary [mortgage]
Over two thirds of the UK earn less than the average wage.
In 2008 an ONS survey showed that over 6 million people earn £10k per annum or less.
These included Hairdressers and Cleaners.
@ Elle
I was renting at the time I wed my wife. I can happily confirm that our priest gamely ploughed-on with the ceremony despite this handicap.
Similarly, renting has not effected my virility.
"Some 90% of 18 to 29-year-olds would not be 'happy' if they had to live in rented accommodation for the rest of their working lives"
An odd view in my opinion. Why not happy?
I am indeed under 30, but do not have the tied down burden of holding onto a property losing money by the day and I have no intention of being 'unhappy' by not ever owning my own home. I can treat my partner, go out and away at weekends and enjoy life, holiday 3 times a year and not worry about buying things. Of course, there are things I have to save for but I can do what I feel happy doing. The funds that I could have ploughed into property goes on other things that I enjoy doing and have wanted to do.
Unless you have oodles in the bank to enjoy these things alongside owning a home then what..? Are these 20 something’s telling me happiness is being sat amongst bricks and mortar wishing for a holiday, or wishing you could afford this and that, or wishing you could replace that god awful woodchip wallpaper and remove that royal blue velveteen carpet?
Come on, these 20-30 year olds will get themselves so worked up and save for years to own some bricks, only to be unable to do anything else, that is a majority situation amongst my friends and colleagues. Let’s face it, for those that say that home ownership would still let them do all these things and still enjoy the quality of life as they had before, must be the ones that already own homes by being part of 'the right thing to do' brigade and bully for them/you. Well done!
But these are not the people surveyed here, these are the ones that have a choice to make, and quite frankly, there is a lot more to life than making the 'right choice'. Especially if that right choice derives from the pressure from society and peers.
"43% do not want to get married until they own their own home"
Why on earth not???? What has owning your own home got to do with taking vows of marriage!?
Oh hang on, I see, it's the same 'right thing to do' brigade cropping up here again- horse and carriages, doves, and the meringue dress, it's becoming expected, turning your nose up at anything less than a small fortune for a wedding. Makes sense now....they can't have this wedding as they are saving for the house, and it would not be the right thing to do and splash out on a wedding first now would it?!
Your simple either/or reasons for people thinking that they want to own their own home doesn't wash with me, it's pressure and the view of what is acceptable and the 'right thing to do'. When has buying a home been a exercise to prove equal capability to your parents. Phew, I'm glad I don't feel pressured to live the same life as my parents and have the freedom to be my own person and so what I feel is right for me. I have already inherited my Mum’s nose and eyes, I draw the line at totally morphing into her clone! I would hope that my parents pride in me is a lot more than my ‘capability’ of acquiring a plot of land.
In my opinion there is far too much emphasis on how things should happen and what is an acceptable way to go about living.
Those cramming for this socially acceptable life then good luck, but I'm telling you (albeit I'm sure that there are some who are mistaking my views as bitterness), renting is a joy for me, and this 'renting is throwing away money' statement that is banded around is rubbish in my eyes..............
...people don't bat an eyelid about spending money on other purchases ...you may own these items but they don't provide you with a whole lot of financial return either!
My rent provides me with A HOME - yep, walls, floors and ceilings, just like your house! It greets me every day I get home, contains all my lovely furniture which quite frankly I wouldn’t have if I'd just spent all my money on buying the bricks!
Each to their own and I do mean that; my main bone of contention lies with the snobbery and expectations placed upon young people today and it astounds me that this generation are still living in the shadows of 'it's the done thing'. This article proves just the snobbery I mean – first paragraph – “...and don’t want to settle for long-term renting”. Settle? Well if thats the way it’s viewed, then I am more than happy to settle... it’s a hell of a lot more than the homeowners I know....
The UK median Household Income is one way of considering affordability.
The last time house prices followed their long term inflationary affordability as a proportion of household income was the mid 1990's.
It is clear that if prices fall to the same level of affordability relative to median household income earnings and interest rates, as they did in the mid-1990s, we are still looking at a 50% + fall, from 2007 peak prices.
Home ownership has remained pretty level since 1990.
An important difference between this bubble and the late-1980s bubble is that this time there are a lot more buy-to-let speculators. These people are highly leveraged (their debts are high relative to their assets) so small changes in asset prices make a big change to their situation.
As it becomes more difficult to borrow money, many of these people will find that they cannot refinance at affordable rates when their 'teaser' rates come to an end. The long term average Base rate is at 5%. When IR rise again these BTL Speculators should have to sell their properties or the bank should repossess.
{Although the FT recently reported that Several of the UK and Irish banks that received government bail-outs are offering to write off up to 25 per cent of a mortgage debt for professional landlords and developers. So we are not in a free market.
Why should those who do not own property have to pay for this?}
I believe Under 10% of the UK homeowning [owner occupier] population would be facing negative equity if a 50% housing crash occured
[There is just over £1 trillion in outstanding mortgage lending in the UK. Over £200 billion of that is BTL
Over 50% of 'UK Homeowners' own their property outright.
So Over 20% of outstanding Mortgage lending is BTL.
Under 10% of Outstanding Mortgage lending are 'Owner Occupier' Mortgages, or the FTB'ers etc, who got onto the ladder DURING Browns Fake Boom.
The other 20% of Owner Occupier mortgages are people who would not be facing neg equity if a 50% housing crash occured.
[These are the people who got onto the ladder BEFORE Browns fake boom]
When IR do increase, the BTL investor, should not be in the position of the owner occupier homeowner, [with negative equity but an affordable mortgage,] who can afford to hang on as long as he doesn’t lose his job, or move house.
The BTL speculators should have to lower their price to sell. [ But The bank bailouts have given the banks, an opportunity to engineer a soft bottom in the housing market. Thus propping up house prices, making sure FTB cannot afford their own]
So who exactly is the government supporting here?
Because its not 'Joe Bloggs, the average worker, who simply wants to be able to work for a house, a job and a family, is it?
When you consider the Vast Sums of toxic mortgage debt created by 'Liar Loan' Landlords, compared to the debt of owner occupier's.
The housing crash may manifest itself in a lack of volume initially.
But it should be quite rapid once it gets going.
A 60% reduction from peak prices is likely to occur.
As we will see an overshoot on the way down. [This should have happened already. It is simply a return to the long term average affordability of housing]
But it will only happen in a free market!
If you want to see FTB'ers return, stop stealing our money, via QE and IR etc to bail out people who should never have been allowed to borrow so much money, and bankers bonuses.
Stop supporting criminals, theft, greed, liar, fraudsters, and start supporting the average worker.
Why shouldnt we have the same chances as you homeowners did?
The Coalition should realise, we all know whats going on. Weve had 13 years of bullsh1t under Labour. We can smell it a mile away.
All you have to do is raise CGT/IR/Tax BTL/dereg planning/Build more social housing. Bring the price of land down etc etc.
Shared ownership has already failed under Labour and will fail under the Tories.
Ironically the best solution for Estate Agents would be a 60% crash. And therefore the 'younger' Estate Agents should be singing from the same hymn sheet as the average person, who is priced out of housing.
The Quicker you estate Agents accept the inevitable.
The better for you,the economy, and society as a whole.
@ Curved ball...
".......If you are in rented accommodation the landlord can give you 2 months notice to move out..........."
So what difference does it make if you are married or not?
"Please Reinflate the bubble" Whine Estate Agents in the UK as house prices fall by 40% in California, and 60% in other states, Greece, Spain, without sight of bottom.....
When I buy my first house, Ill be doing everything possible to cut out the EA.
And buying for 60% from peak.
Have a nice day.
Money lenders do not make a profit unless they actually lend. House prices can only fall so far and we are approaching that level. Existing homeowners will not sell if they have a mortgage that at least can be settled and builders will not build unless they can sell at a profit. Before much longer Supply & Demand will kick in .
Richard - the story asks for comments, Barratts are a vested interest in high house prices.
Anyhows, if I was on benefits and they were cut I would ask my landlord to lower the rent. If he did not I would find one that would, there are plenty out there. It is called competitive arbitrage and is an attribute of all reasonably free markets, something that social landlords and estate agents might do well to look up.
Why does owning a home make getting married acceptable?
If you are in rented accommodation the landlord can give you 2 months notice to move out. The people surveyed had given some thought to the question. You have read the story and in your on head spun it into someting else.
It isn't right that folk in their 20s can't get mortgages either.
It is only the hedonistic lifestyle of the younger generation that is stoping them saving up a deposit. Percentage deposits have been increased in part because of the never ending Party. Affordability is the new yardstick for both Mortgages and Tenancies and that yardstick penalises those that are spending too much of their disposable income on having fun or simply do not have jobs to support their wants.
Cut up the credit cards, pay off the overdraft and save up like we all had to.
Forget about the strapline, this is simply Barratts complaining that they can't flog-off their over-priced tat on to unsuspecting FTBs. If the FSA's proposals go through (and let's hope they do) the 'poor' under-30s won't need to rent all their lives.
SR- in rented then, what will you do when your benefits are cut? The story did not ask for your opinion on house prices, did it?
Home ownership in this respect is a sentimental fad - house prices are simply way way above the long term growth trend and they will fall back, as, say German ones did, halving in 15 years or so in real terms.
The efficient market principle shows that, long term, renting vs buying does not make much of a difference since equilibrium house prices follow rental costs, following a similar asset-yield to other dividend-carrying assets (of which property is, of course, one). Since rentals have showed below-growth rates over past 10 years, and are being hammered by withdrawal of housing benefits, then house prices will follow (in fact ARE following, bust will simply turn into more bust, not boom like you are hoping)
Elle: What factors, pray tell, do you determine "happiness" by? Where in the article does it state that it is unacceptable to be married without first buying a home?
Young people - you might remember being one once... simply would like to own their own property. Why? Simple: EITHER their parents did - and therefore they want to show that they are equally capable; or their parents didn't for one reason or another, and they want to show their parents that they can achieve something that the older generation could/did not.
You forget the mind-set of the nation. To own your property is a feather in your cap. That is why we will never fully integrate with our Euro cousins.
You rent a house for 25 years - you own nothing. You pay a mortgage for 25 years - you have a tangible asset that SHOULD, as far as all written records will attest, be worth far in excess of your initial purchase price. If it isn't... so what? you still have the asset.
Maybe the under-30's simply have their heads screwed on. Maybe they simply would like some security, that they view owning their own homes would afford them, in order to enjoy the happinesses of married life and children.
I'm sure you will have a view to impart...
My goodness, people really do not value life do they, certainly when it comes to owning a home on determining 'happiness'!
Why does owning a home make getting married acceptable?
Silver bullet ? watch out grandparents
The sensible answer is time.
Time will provide the younger generation with chance to save, chance to inherit a deposit, and in time the banks will come back into the mortgage market and re-create the boom that we have seen pop once again - it will happen - just give it more time.