I can't sleep because of the property market.

When I was saving for a deposit, that was all I did with my money, no toys, no gadgets, no expensive holidays, just eat, sleep, work and save.

Yeah but that means you probably got on the housing market at just the right time ie late 90s.

Actually not really. I bought a house in Leeds 2001 and sold a year later, made a modest amount, enought to manage to together a deposit on a flat in London, but the market had stagnated then, I had to save for my next house deposit.

Its actually in the last 12 months that most of the capital appreciation seems to have happened for me. I’ve just sold my house for 20% more than it was valued for 12 months ago.

all i am going to say is don’t get some savings then get made redundant…and then have to spend them on living costs…. dont get evicted from your rental property every 9 months with the associated costs of moving…

as for comments about moving back home…. i guess that might work for some, but if you want a job sometimes you haven’t got much choice, and what about if your parents don’t want you moving back home? Why should anyone expect to be living at home when they are 35-40-50etc.

What is the average commute these days? what is the state of public transport? you can try and blame the first time buyer but house prices are out of kilter with earnings. The banks have got cold feet lending the multiples they have been. Prices as they are going no where fast, unless the economy really goes tits up.

Actually not really. I bought a house in Leeds 2001 and sold a year later, made a modest amount, enought to manage to together a deposit on a flat in London, but the market had stagnated then, I had to save for my next house deposit.

You got on before 2008, which is when it became really really hard for first time buyers.

Prices now are broadly similar to what they were then, but mortgages are much harder to get. Leads to much longer trying to pay rent AND save a deposit, rather than just paying off a mortgage.

@poly- The only way I can find a place for -£300 a month would be to rent 1 bedroom in a shared house in the very dregs of this town. However, it’s rare to find somewhere for less than £350-£400.

A colleague went to see one in a really shit part of town last night (he’s living by himself at the moment). For a small room in this shared house they want £350 a month. Even house shares aren’t that cheap any more!
Anyway, aside from the rent I don’t live a lavish lifestyle. We have a car between us (10yr old fiesta) which doesn’t get used much, but the inconvenience of not having it vs how much we could sell it for, it’s not worth selling. I cycle to work pretty much every day (only use the car if the weather’s truly terrible) so it costs virtually bugger all to run.
Our TV (a fairly decent, large one) was a donation from my dad, as a 10% strip down the side of the screen doesn’t work. Make do and mend 😀
Bike parts are the only thing I do spend money on, and even then that’s been cut back drastically of late. I had to spend £20 on a tyre for my commuter bike yesterday, as I’d worn through the last one.
I almost never go out drinking. I don’t think I have since I moved here 4 months ago.
Any furniture we have has been bought from 2nd hand/charity shops.

I didn’t intend to make this rant about my own situation, rather about the stupid amounts of money involved in property. I’m aware I don’t lead a perfect super-scrimper lifestyle, and I think you’d struggle to find anyone who can honestly say they do. I don’t particularly want to go into any more detail as it’s unnecessary, however I have divulged the above information in answer to comments such as:

“Too many people are buying must have items like every Apple product under the sun, travelling the world etc. and not saving.”

“Kids want everything handed to them on a plate these days” though I’m aware this could just be trolling…

I honestly resent these kind of idle daily mail-esque comments. They are completely unnecessary, judgmental and unfounded.

My current situation is my own problem, and I will find a way round/over/through it. I said in my original post that I wasn’t looking for suggestions of ways to get a house, and I certainly wasn’t looking to be told in so many words that I’m some sort of terrible person with a horrendous sense of self-entitlement. I’m many things, but I’m not that!

I honestly resent these kind of idle daily mail-esque comments. They are completely unnecessary, judgmental and unfounded.

It’s worth remembering where you’re posting, Pinetree. There’s a lot of money floating around certain parts of these forums, and a lot of very comfortable people.

Were I enjoying such levels of comfort in this age and climate where so many are starting to really struggle, I too would find comfort in any logic allowing me to blame the poor for their own misfortune so as to make me feel better about my fortune.

Anyway, aside from the rent I don’t live a lavish lifestyle…

So where the heck is the other £1500 a month going if you can’t afford to save? If you don’t know, then have you considered doing accounts of what you spend so you can keep track – I used to do that back when I was really struggling for money.

Trying not to go all Daily-Mail on you – I appreciate that by complete random chance I managed to buy at the right time (and admittedly was also fortunate enough to have some inheritance – but that just means I have a bigger house, not that I have one). But plenty of us currently comfortable people did go through a period of scrimping and saving and not spending too much money, and it’s the suggestion that you can’t afford to save on your income which leads to the comments (nowadays I have 2 kids and living off my redundancy payment, so knowing how not to spend money comes in handy – oh and our TV is 15 years old).

Why invest if you don’t then release cash from the investment?!

I have 3.25 properties [1 shared] mortgage free now
1.25 bring in a good income

I have no intention of releasing any cash and plan to sign them over to the kids when I reach 65
They may of course decide to release money by selling a couple of them but I hope not

Were I enjoying such levels of comfort in this age and climate where so many are starting to really struggle, I too would find comfort in any logic allowing me to blame the poor for their own misfortune so as to make me feel better about my fortune.

and you’d not be alone, you have the media lapping up and re-regurgitating Tory propaganda telling us all that the poor are poor due to their own idleness.

“Too many people are buying must have items like every Apple product under the sun, travelling the world etc. and not saving.”

“Kids want everything handed to them on a plate these days” though I’m aware this could just be trolling…

I honestly resent these kind of idle daily mail-esque comments. They are completely unnecessary, judgmental and unfounded.

Why do you resent them? They weren’t aimed as you per say but more comments about consumerism today I say. Something that may be backed up by the amount of credit card debt that a reasonably large chunk of the population has.

As said above…if you don’t spend anything on socialising or transport where’s the other £1500 of your salary going each month after household bills & food?

I’m regretting even mentioned my income situation to be honest, as it’s changed quite a bit recently. As I’d said in a previous post, this month will be the first month we’ll have £2k coming in.

We left the last city we were in (York- which is terrible for renting) as I took a higher paid job down south. However since we moved, my missus has been out of work. She’s managed to find something now which is a reasonable job, but it’s a temporary contract due to last up to 6 months (they’re going to try and find her something else afterwards, but it’s not guaranteed.) It also involves a daily train commute which has been setting us back £55 a week since she started. Basically I’m skint.
Up until this point we’ve been living off my salary. It’s allowed us to get by, but with the cost of moving etc I’ve had to dig into the small amount of savings I had. Meaning I’m starting again with saving, and it’s been bloody difficult!

I don’t take back any of my points about the property market, as I feel they’re perfectly valid, irrespective of my personal situation.

Actually not really. I bought a house in Leeds 2001 and sold a year later, made a modest amount, enought to manage to together a deposit on a flat in London, but the market had stagnated then, I had to save for my next house deposit.

A combination of these 2 graphs probably suggest u brought at approximately the right time. Admittedly u might have been better a year or two before.

House prices

As you can see houseprices were going up before 2001 but they really shot up from then on. Admittedly if you were buying bigger and bigger places these would have hindered u too, but at least your deposit was increasing with house pricing being in a house already.

interest rates

This show interest rates have generally been reasonably low since 2001 so you should of got good deals on your mortgage.

but the market had stagnated then

If the market had stayed stagnated there would nt be a problem !!!

I dont see why u’d see a stagnant market as a problem presuming you were upsizing/moving to a move expensive area.

The only time a rising market can help any one is if their downsizing/moving to a cheaper area.

If the market hadnt stagnated u’d have still had to have saved for the next deposit, unless u were lucky enough for ur Leeds flat to be in an area of particularly strong house growth from 2001 to whenever.

I don’t take back any of my points about the property market, as I feel they’re perfectly valid, irrespective of my personal situation.

The trouble is, most of them are either not terribly practical or unlikely to be legally possible – and at least some are as unfair on other people as you think the current situation is for you. In any case, whatever you do it’s unlikely those who’ve really profited out of the whole current situation will suffer – they always have better accountants.

whatever you do it’s unlikely those who’ve really profited out of the whole current situation will suffer – they always have better accountants.

True dat.

Yeah! houses are just too expensive. And food. All this stuff costs a packet and leaves me with no money to spend on frivolous stuff. I want one of those amazing flash loft apartments in New York that folks in sitcoms always seem to have despite having menial, ill-paid jobs. Having to be educated, work hard and continue until death is just so unfair. 😕

Then again, it could be worse, I could have insomnia.

Every body says ‘work hard’ — at what exactly– long hours at a computer, or a 12 hour shift on a building site, surely you mean work smarter, more return for less input, like the fatcats

Sometimes, I think people just dont know when they have it good.
You are spending 30% of your income on your rent – thats remarkably cheap. When I first moved from my parents, I was paying £260/month (1987), and was taking home £90ish a week – whats that 70%?.
I survived, and could go out at the weekends too.
Even now, my mortgage is around £350, and income around £800, so 40% of my income, yet I dont complain at all, and dont feel I have a limited lifestyle. I just dont waste money,I only go out once a one week, a 1 wk holiday a year, stick with the same bike, only replacing parts when they wear out etc.

You need to sort out your priorities, you either want a nice house, or, live your life spending your income on frivolities, you cannot do both unless you are earning a fortune.

@poly- The only way I can find a place for -£300 a month would be to rent 1 bedroom in a shared house in the very dregs of this town. However, it’s rare to find somewhere for less than £350-£400.

Well either you didn’t factor this in when moving down south to the bright lights and bigger salary or you need to accept that if you want to save more money. The other advantage of shared flats is that bills, council tax and even food costs etc can be lower per head than on your own. I’d look at the cost of that car. I’ve never known anyone spend less than £500 a year just to keep a car on the road (£135/yr for tax; £250/yr for insurance, £40/yr MoT, + a basic service) and that’s before you drive it anywhere, need to actually repair it or put tyres on etc.)

I think its worth bearing in mind that in many other parts of Europe ordinary people in their 20s often can’t afford to buy – but this is considered normal – and people are comfortable with renting. Affordable housing used to be (and technically still is) the domain of local authorities, through “Council Housing”. Unfortunately our Parents’ generation let Maggie implement a ‘right to buy’ policy which helped their generation with their aspirations but left subsequent generations with a shortage of affordable housing, and helped inflate house prices which has exacerbated the problem.

You can still buy a small flat in some parts of Scotland for well under £100k though (and indeed some grotty flats in undesirable areas for half that) which means its possible to ‘get on the ladder’ IF you make other compromises. You’d still need a deposit – but its a realistic one, and not that different from other people probably saved 20-30 years ago when buying for the first time.

Alanl, all I can say is that for a house where I live as a first time buyer on your £800 take home- say 13k a year…

A cheap 2 bed flat is about 10x your income. The absolute cheapest property might be about 7x. So you’d need a big deposit, say 60-100k. Obviously with a partner you’ve got a much better chance. Oh, rent on those 2 bed flats is about double your mortgage btw.

OP.. speak to your parents, you will find that it was normal back in the 60s/70s to SAVE MONEY to buy things, credit wasnt available and you could only borrow a max of 3 to 3.5times your income on a mortgage and that is what people did. Very little property ladder climbing the 80s had yet to come..
Me and the missis had our 1st child at 22/24yrs old at the time we had saved for a deposit 5% and borrowed the rest to buy a house that took around 1/3 of our income (this is normal) and has been for years.
Property for normal working class ppl is available at resonable prices for most its just that many think of themselves as above working class and just cant live in a 30s terrace house same as they must have a BWM/Audi/Ipad/Iphone…
Your stressing about nothing, enjoy life and avoid credit buying consumer tat like phones/tablets/cars..

But you are earning more than double what I am.
Everyone finds it hard to get their first place. You cannot live the life you want for maybe 5 years, as you have to pay the bulk of your earnings toward the house/flat.
It has always been the same, I struggled when I did it. My parents did.
If you cannot afford to buy in the area you are in, you need to move away. I did it 16 years ago, and it sickened me that I had to move from the village I had always lived in as I couldnt afford a house there, but I’ve got over it.
If you were paying 85% of combined income to rent/mortgage, then I could sympathise, but at 30%, you shouldnt complain – you’ve still got a joint excess after rent of £1000+/month – many/most people would be glad of such an amount – it is far more than many people earn.

Sometimes, I think people just dont know when they have it good.
You are spending 30% of your income on your rent – thats remarkably cheap. When I first moved from my parents, I was paying £260/month (1987), and was taking home £90ish a week – whats that 70%?.
I survived, and could go out at the weekends too.
Even now, my mortgage is around £350, and income around £800, so 40% of my income, yet I dont complain at all, and dont feel I have a limited lifestyle. I just dont waste money,I only go out once a one week, a 1 wk holiday a year, stick with the same bike, only replacing parts when they wear out etc.

You need to sort out your priorities, you either want a nice house, or, live your life spending your income on frivolities, you cannot do both unless you are earning a fortune.

i contenst your last point… many people are stupid and live on credit, thus you can do both…and maybe get to appear on jeremy kyles show..

Property for normal working class ppl is available at resonable prices for most

Err no, no it isn’t. Maybe it is in the north, where wages and employment opportunities are lower. I’m not exactly sure why some people want to deny the house price boom, but it is a FACT that house prices have risen much more than wages over the past 15 years. Therefore it is a FACT that it’s more difficult to get on the ladder now for the low paid.

It is of course still possible for some people in some areas to get on the property ladder with a few years of frugality and saving, for others it is very hard and for some nigh on impossible. Obviously a lot of people don’t understand just how much harder it is for first time buyers now than it was 10, or even 5 years ago. I think there is a tendency to always think that you are the badly off one, which in this case equates to thinking that first time buyers now are just lazy or squandering money, if you managed to buy a house then they can. However it has got an awful lot harder since 2001, as this article explains:

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/9481892/House-prices-rise-at-three-times-the-rate-of-wage-inflation.html

OP.. speak to your parents, you will find that it was normal back in the 60s/70s to SAVE MONEY to buy things, credit wasnt available and you could only borrow a max of 3 to 3.5times your income on a mortgage and that is what people did. Very little property ladder climbing the 80s had yet to come..
Me and the missis had our 1st child at 22/24yrs old at the time we had saved for a deposit 5% and borrowed the rest to buy a house that took around 1/3 of our income (this is normal) and has been for years.

Is this really serious? No-one thinks they should get a house without saving.

As for only being able to borrow 3 to 3.5 times your salary in the 1970s, you can only borrow 6 times now, however, in the 1970s, you only needed 3 times the average salary to buy the average house, now you need 10 times the average salary to buy the average house. In other words to afford an average house on an average salary these days, you would need a deposit of 4 times your annual salary, pre-tax, pre-rent, pre-bills, pre-everything. All of it for 4 years. Clearly that’s impossible in less than 8-10 years, and even then you’d have to be living with parents and paying no rent.

Mortgage inflation has far outstripped wage inflation in the past 40 years. Average salaries were around £2,000 a year in 1971, with the average house selling for £5,632: in essence, less than three times earnings. The average asking price for a home rose to £238,874 in May this year, according to Rightmove, while the average salary sits at about £25,000.

From The Guardian

Young people know they need to save to buy a house, however without help from parents/friends the Evening Standard worked out that average first time buyer in London will need to save for nearly 20 years for a deposit at current prices, and from the Guardian stuff I posted it looks like thats not much different across the country.

A lot of things are undoubtedly easier since the 1970s, but buying a house is not one of those things, and I cannot understand how anyone can’t see that, the facts are out there and are pretty obvious.

I think its worth bearing in mind that in many other parts of Europe ordinary people in their 20s often can’t afford to buy – but this is considered normal

and in most of europe you are not at risk of eviction at two months notice with no opportunity to have security of tenure.

Neither can I.

I’ve made so much money from it that I’m routinely up all night browsing through car brochures.

😉

None of that is true.

It comes and goes, sometimes it’s relatively more easy, sometimes it’s relatively harder.

Yes, house prices are high but a lot of young people complain about how they can’t afford a house but never make any sacrifices to save.

Too many people are buying must have items like every Apple product under the sun, travelling the world etc. and not saving. I know my parents had to scrimp and save to get their first deposit and were right on the limit of what they could afford.

A lot of people just don’t want to sacrifice their lifestyle to be able to buy a house, but are all to happy to complain that they can’t afford one.

Sorry haven’t read the whole thread, however this is how I feel.

To get the deposit for my first small 1 bed flat I worked 6.5 days per week. Often missing out on buying clothes, make-up, going clubbing/partying with friends etc. During the first few years there was a recession, my wage almost halved and my mortgage doubled, so I ended up having 2 jobs.

Given that it’s far harder to afford a house than it used to be, it’s a legitimate complaint. The level of sacrifice requires is much higher, this is not good. It is possible of course, but there you go.

Yes, house prices are high but a lot of young people complain about how they can’t afford a house but never make any sacrifices to save.
Too many people are buying must have items like every Apple product under the sun, travelling the world etc. and not saving. I know my parents had to scrimp and save to get their first deposit and were right on the limit of what they could afford.

A lot of people just don’t want to sacrifice their lifestyle to be able to buy a house, but are all to happy to complain that they can’t afford one.

Do anyone of you remember how when you were young you thought your parents were idiots and you’d never be like them ? Say the same things, whinge the same things act the same way ?

And this is coming from someone who was born middle aged.

One of the problems here is that a lot of people who rent don’t have much idea of the real costs incurred by landlord (declaration of interest – I’m NOT a landlord).

The original poster is £525 a month, or £6,300 a year.

Out of that, the landlord will be paying:

c£250 a year for landlords insurance
£300+ service charge if it’s a flat – and a lot of flats are a LOT more than that
£Ground rent
£100 or so for boiler maintenance and an annual safety check
£100 or so for an annual PAT test
£630 to the letting agent, and another £315 if they are managing the property
£around £200 a year (averaged) for decorating a flat at 5 to 6 year intervals (more if the tenants treat it as someone elses property)
£200 a year for carpets (as above – get a few tenants who throw red wine on the carpets and very quickly you need new carpets but have no chance of getting any money back through the deposit protection scheme)
£a few hundred a year to pay for new furniture – which generally lasts 5 years or so before it’s wrecked in a rental property)
£the cost of any building repairs – even a few callouts from a plumber or roofer etc can quickly rack up to half a grand a year.

So that’s £2595 and leaves the grand total of £3705 left, or £308 a month. Most landlords aren’t lucky enough to avoid voids, so a void of 4-6 weeks a year (turnover on smaller properties is higher), takes another £750 or so off that, and incurs another set of letting agent fees for the new tenant.

So we’re now down to £1800 to pay the mortgage, and get enough of a return after tax on any profit to:

– cover any major emergency expenditure
– cover the cost of a bad tenant completely trashing the place with only a deposit of £525 in hand to pay for the damage
– give a reasonable return on the capital employed in the mortgage.]
– cover late / missing payments
– cover the time / hassle of sorting all of the above

Most landlords think themselves pretty lucky if they get a 6% return – with some corporate bonds now offering returns of 10% with no risk, I can’t quite see how landlords can be said to be profiteering given the ever present risk of the property being trashed or lying empty for a few months every year or so.

Better not try buying abroad

I was 100% serious.. many today believe they can have everything now and mortgages at 6times salary are a great indication of this madness.

Also look at all the junk you can waste money on today that didnt exist 20-30yrs ago, mobiles, ISP’s, subscription TV, pizza deliveries the list goes on and on.. and most are of these new items are luxuries not necessities but still people on decent incomes waste their money and then whinge at the cost of living in the next sentence..
Thread has run its course nothing new to add..

What tyres for aspirational middle classes ?

wheres the love