The truth hurts

[Drago]

Daughter #3 and her feller are living on his salary, and banking almost all of hers. Its very tight, but with no foreign holidays, dining out etc, they've saved 18 big ones in a year. Another year and they'll be well north of 30 gees and ready to buy.

Its difficult because she's 20 and her feller 21, and all their mates go out in the razz and on holiday to sunny climes, but in a year they'll be sitting pretty and will have the last laugh

 

[GM]

Stevenage really isn't all that, you know

Don't the up market estate agents call it St Evenage

 

[Slick]

Daughter #3 and her feller are living on his salary, and banking almost all of hers. Its very tight, but with no foreign holidays, dining out etc, they've saved 18 big ones in a year. Another year and they'll be well north of 30 gees and ready to buy.

Its difficult because she's 20 and her feller 21, and all their mates go out in the razz and on holiday to sunny climes, but in a year they'll be sitting pretty and will have the last laugh

Exactly. That's how Mrs Slick and I did it except we lived on hers and banked mine as it was the highest.

 

[TheDoctor]

Which is why some have a home and some don't.

Well, yes, but I exaggerated my numbers to make a point.
Let's instead look at our car, which is nothing remarkable.
It cost £5500, five years ago. It's still worth something, so £1000 a year in depreciation?
Insurance, servicing, VED - £1000 tops.
Fuel - another £1000 tops.
£3000 a year will get you nowhere when looking at houses. The point I was trying to make is that spending on cars isn't the issue, it's the fact that an average house is nearly ten times the average salary. Like that rich American the other week claiming that people could afford a house if they didn't buy Starbucks coffee, it's blaming the victims, pure and simple. We could not afford our house if we were to buy it now, and that's purely down to its value having increased tenfold in the last fifteen years.

 

[Slick]

Well, yes, but I exaggerated my numbers to make a point.
Let's instead look at our car, which is nothing remarkable.
It cost £5500, five years ago. It's still worth something, so £1000 a year in depreciation?
Insurance, servicing, VED - £1000 tops.
Fuel - another £1000 tops.
£3000 a year will get you nowhere when looking at houses. The point I was trying to make is that spending on cars isn't the issue, it's the fact that an average house is nearly ten times the average salary. Like that rich American the other week claiming that people could afford a house if they didn't buy Starbucks coffee, it's blaming the victims, pure and simple. We could not afford our house if we were to buy it now, and that's purely down to its value having increased tenfold in the last fifteen years.

Drago's example was the point I was trying to make. Make sacrifice, save up large deposit, prove you are a good bet, get mortgage then buy whatever house you can afford. It's unlikely going to be as nice as you think you deserve but a little more hard work will sort it out.

 

[TheDoctor]

Daughter #3 and her feller are living on his salary, and banking almost all of hers. Its very tight, but with no foreign holidays, dining out etc, they've saved 18 big ones in a year. Another year and they'll be well north of 30 gees and ready to buy.

Its difficult because she's 20 and her feller 21, and all their mates go out in the razz and on holiday to sunny climes, but in a year they'll be sitting pretty and will have the last laugh

Exactly. That's how Mrs Slick and I did it except we lived on hers and banked mine as it was the highest.

How much will the mortgage payments be? How tight will things be for the next 25 years? And how much are they earning?
I used to earn an above avarage salary, and I could have saved, ooh, £22000 a year. If I'd spent nothing at all.

 

[Slick]

You can make examples to read any way you like, you can make excuses for not managing or you can operate successfully in your chosen area and make it happen.

 

[TheDoctor]

Drago's example was the point I was trying to make. Make sacrifice, save up large deposit, prove you are a good bet, get mortgage then buy whatever house you can afford. It's unlikely going to be as nice as you think you deserve but a little more hard work will sort it out.

No, it won't. Houses go up faster than salaries do.
Anyway, I'm off out. The sun is shining and I've got a bike to ride

 

[Slick]

Enjoy.

 

[screenman]

Plenty of normal working kids buy houses, I have three that have managed to do so. They have friends that did not as they chose a different lifestyle. I think most of us would agree that home ownership gets easier with time.

 

[Drago]

The bottom line is some folk are moaning about it being impossible, while others have the discipline and fortitude to do it.

 

[winjim]

£140k! That's more than we got for the house we just sold, and that was a three bed terrace in an alright area. It was bought ten or so years ago for not much less than that so I say boo to supposed house price inflation.

 

[Dan B]

Oh well, your anecdote definitely trumps the actual statistics

 

[winjim]

Oh well, your anecdote definitely trumps the actual statistics

Yeah, we really beat the system.

 

[nickyboy]

Houses are affordable relative to salaries providing that capital from the oldest flows to the youngest

By that I mean say Great Grandma dies and leaves a £300K house. That gets divvied up to relatives. The issue is whether that percolates down to those that actually need it to buy a house or not. So couple on combined salary of £50K can't afford to buy a £300K house but if they are gifted £150K from the sale of Great Grandma's house then they can

If you consider the flow of cash and the movement in asset prices, the system works and people can afford houses regardless of their salaries relative to house prices. Where is doesn't work is where younger people aren't from a family with a history of home ownership or where the cash from Great Grandma's house goes elsewhere

And for so long as bigger houses are seen as aspirational and people are willing to allocate large portions of their salaries to paying for property loans I can only see houses becoming more "unaffordable" and thus necessitating this top to bottom flow of cash all the more