our house as a kid was bought as a present 1969 4k sold it in 96 before prices went crazy for 80k prob over 200k now 3bed detached..
I suspect that housing policy is yet another blind alley that we have been led up for short term expediency but we are now in a position where houses are increasingly unaffordable yet a fall in house prices could trigger another banking crisis.
see this is what happens when you get associated with that southern mob. because your all at it they assume we are to. dirty english men, dirty.
A wee story from the history of Isay off NW Skye. In the 16th century the main house on the island was inhabited by the MacLeods of Lewis, and it was here that Roderick Macleod of Lewis ('Nimheach' - the venomous) implemented his plan to ensure that his grandson would inherit Raasay and the lands of Gairloch. He convened the two powerful families (names do not appear to have been recorded) of the time at Isay house for a banquet which he suggested was to inform them of good news. During the feast he invited each person present to accompany him outside of the banquet hall in order to inform them of this news. Upon leaving the hall the victim was promptly stabbed to death. In this way both families were wiped out. And his grandson inherited Raasay.
Correct. Average house prices, certainly in England, are running at around 4 times average incomes and in large parts of the country five times and over. That is unsustainable. You cannot underwrite that level of debt with a 25 year mortgage. Its a sub-prime crisis waiting to happen.
No more savage than 16th Century England. Or anywhere else in the 16th century. Thanks feck I was born in the 20th.
We stuck rigidly to a 3.5x mortgage even though we were offered up to 10x. Thats why I am in a modest 2 bed apartment (with garage) and no real unsustainable debt. I remembered the previous recession where negative equity etc claimed several friends homes from them and feared it for ourselves. Thus we kept it modest. Besides theres only the two of us and a ginger feline mouse assassin.
Isn't 4 times average income the kind of figure we had when things were more balanced? I thought average income was around £25K, so unless we assume a two-fulltime-worker household with a gross income of £50K, surely the multiplier is now much greater - with average house prices much nearer £200K than £100K. A friend who works in finance told me that many people now take out mortgages over longer terms - presumably 30 or 35 years. And these days even "first time buyers" may not be able to have confidence that wage inflation will eat away the monthly cost of their repayents. Combine that with the fact that interest rates are artificially low, so an adjustment back to rates which would have been cheap historically (say 4 or 5%?) could push many into difficulties. So yes, we are heading for the rocks. If it's too dangerous to raise interest rates, perhaps all that can be done is to make it much more difficult to borrow a high percentage of house "value"... but that's the opposite of what has been done. My suspicion has been that successive governments, aware of the British obssession with house prices (and willingness to put most savings into housing), have done something (I'm not sure what though) to avoid housing costs being a significant part of RPI and CPI, hence preventing interest rates from being adjusted soon enough to head off our regular booms (which, aside from 1989 on, have not in fact been followed by remedial "busts" - even the post-2008 market did not collapse in the UK, in the same way as parts of the US). For a major proportion of the working population, however much they bleat about it, the cost of food shopping (especially at ALDI or LIDL) and even the cost of petrol/diesel or electricity/gas, is not nearly as much a headache as the cost of housing.
We nave 2 spare rooms, worked bloody hard to get them. Several times a year they get filled with family & grandkids can't do that in one room
House prices (mortgages etc) are not included in CPI, but are included in RPI. That is why RPI and CPI are sometimes similar but sometimes diverge.
