Apparently…..it isn’t a job

[Dan Dare]

2 hours ago, cheddatom said:

Saying that property was easier to buy for boomers is not the same as blaming them for the current financial woes

 

Hate to break it to you, but it wasn't "easier" for us to buy our homes. When I tell people my late partner and I bought our first home (a two bedroomed flat in a fairly run down area) for £38k in 1983, they often roll their eyes and say "It was all right for you" and similar. They are, of course, judging the price we paid by modern day standards, wage levels, etc. That is patently ridiculous.

 

We borrowed five times our combined salaries (I was a civil servant. She was a teacher) and put down a 10% deposit. Interest rates at the time were much higher than they are currently, which pushed up the monthly repayments considerably. It was possible, but not easy - we couldn't afford to run a car for a few years and furnished it courtesy of hand me downs from friends and relatives.

 

If you take five times the average current civil servant's and teacher's salary now and add 10%, you get around £350k. That's enough to buy a two bedroomed flat in many - although certainly not the most expensive - areas. But when were average first time buyers ever able to afford to buy in desirable parts of town?

 

Cheap property for boomers is a myth, pure and simple.

[EBS_freak]

2 minutes ago, Dan Dare said:

Cheap property for boomers is a myth, pure and simple.

But look at the percentage change in the value of that property versus wages and that's where your argument goes to stinky poo.

[Machines]

Just now, Dan Dare said:

Cheap property for boomers is a myth, pure and simple.

 

I have a similar story from my parents, they however made about £20k on the endowment policy (the house was £13k in 1978).

 

Add that now to the house being worth about £290k, not a bad return (admittedly the money is non-existent unless it gets sold). That said, mine has gone up about £30k in 12 months, but I doubt it'll go for £4.6m in 40 years.

[cheddatom]

1 hour ago, Dan Dare said:

 

Hate to break it to you, but it wasn't "easier" for us to buy our homes. When I tell people my late partner and I bought our first home (a two bedroomed flat in a fairly run down area) for £38k in 1983, they often roll their eyes and say "It was all right for you" and similar. They are, of course, judging the price we paid by modern day standards, wage levels, etc. That is patently ridiculous.

 

We borrowed five times our combined salaries (I was a civil servant. She was a teacher) and put down a 10% deposit. Interest rates at the time were much higher than they are currently, which pushed up the monthly repayments considerably. It was possible, but not easy - we couldn't afford to run a car for a few years and furnished it courtesy of hand me downs from friends and relatives.

 

If you take five times the average current civil servant's and teacher's salary now and add 10%, you get around £350k. That's enough to buy a two bedroomed flat in many - although certainly not the most expensive - areas. But when were average first time buyers ever able to afford to buy in desirable parts of town?

 

Cheap property for boomers is a myth, pure and simple.

 

Obviously individual circumstances differ, but the facts as EBS_freak alludes to are there for us all to see. It may have been "less easy" for you, but it was easier for boomers on average. I don't think anyone begrudges the boomers' success in the housing market. I certainly don't! My parents did very nicely.

[Stub Mandrel]

On 03/10/2022 at 16:18, Woodinblack said:

 

My school career officer told me there were no careers in computers for people like me.

 

Which was nice

 

"What sort of job do you want?"

 

"A total doss. Something requiring minimal qualifications, skill and knowledge, no real work, just sitting round chatting to people and making things up off the top of my head. I thought, maybe I could get a job as a careers officer."

 

[Grimalkin]

Now is the winter of our discount tents.

[Dan Dare]

4 hours ago, EBS_freak said:

But look at the percentage change in the value of that property versus wages and that's where your argument goes to stinky poo.

 

Afraid it doesn't. Currently, the average wage in the UK is £31.5k. The price of the average property is £278k. Both are ONS figures, not plucked from the air or the Daily Mail.

 

So the average home costs around eight times an average individual's annual wages. That is very similar to the position we were in individually back in 1983. Neither of us could have afforded to buy our flat individually. We were both earning average salaries. We could only afford to do so because we pooled our resources. 

 

The same is true today, when, with the exception of those in well-paid work, only couples or people who are older and have some equity or money behind them can afford to buy.  Two people earning average wages - £63k combined - could afford the average property in exactly the way we could. In fact, eight times £63k is actually a little over £500k, which equates to something quite a bit nicer than the average property.

 

Property values are dictated by the market. If people were unable to pay them, they would remain static or fall. 

[Dad3353]

3 hours ago, Grimalkin said:

Now is the winter of our discount tents.

 

My Word..! Not even a quote..? 

[Downunderwonder]

On 05/10/2022 at 22:26, Tim2291 said:

I was hoping to join the airforce as a pilot, until I found out I was very colour blind and wouldn't be allowed to fly a plane. What's the point in being in the Air Force and not being able to fly the plane?

A tremendous amount of work goes on to put a plane in the air and get it back on the ground safely that has zero to do with the pilot.

[BigRedX]

10 hours ago, Dad3353 said:

 

My Word..! Not even a quote..? 

 

Actually it is - the origin is from a R4 comedy program.

[cheddatom]

I was interested to see if I'd been hoodwinked by the media into thinking property prices had risen much faster than salaries.

 

The current figures are easy to find from the ONS: 

 

Average weekly earnings were estimated at £601 for total pay, and £565 for regular pay, in May 2022

 

Older figures are harder to come by..

 

At October, 1970, the provisional figures of average weekly earnings of full-time manual workers were £28 Os. 11d. for men aged 21 years and over, and £13 19s. 10d. for women aged 18 years and over.

 

I found an "old to new money" converter online. I've no idea if this is correct, hopefully some members can tell me? It's saying £28.05 for men, £13.49 for women. I don't really have time to find out how many women worked etc. to find the true average but to be generous let's say £28

 

So pay has gone from £28 to £601 from 1970 to 2022 or a 21.5 fold increase

 

Trying to find house prices...

 

At the start of the 1970s the average house price was £4,057
...
And now in June 2022, house prices have reached a record high of £271,613

 

So a 67 fold increase, or more than triple the increase in pay.

https://api.parliament.uk/historic-hansard/commons/1971/jan/28/average-weekly-wage

 

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/averageweeklyearningsingreatbritain/july2022#:~:text=Average weekly earnings were estimated,(COVID-19) pandemic.

 

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

 

Like I said, I really don't begrudge anyone's success in the property market. These are the facts and it's not a personal insult to anyone.

[Tim2291]

13 hours ago, Dan Dare said:

 

Afraid it doesn't. Currently, the average wage in the UK is £31.5k. The price of the average property is £278k. Both are ONS figures, not plucked from the air or the Daily Mail.

 

So the average home costs around eight times an average individual's annual wages. That is very similar to the position we were in individually back in 1983. Neither of us could have afforded to buy our flat individually. We were both earning average salaries. We could only afford to do so because we pooled our resources. 

 

The same is true today, when, with the exception of those in well-paid work, only couples or people who are older and have some equity or money behind them can afford to buy.  Two people earning average wages - £63k combined - could afford the average property in exactly the way we could. In fact, eight times £63k is actually a little over £500k, which equates to something quite a bit nicer than the average property.

 

Property values are dictated by the market. If people were unable to pay them, they would remain static or fall. 

 

£31.5 k is apparently the average household income in the UK, not an individual. The average will always be completely wrong for most though, like a one size fits all, in actual barely anyone actually fits. There are people earning far more than the average, there are many earning dead on the average, but there are a lot of people who earn far far below that average.

 

I think the biggest issue at the moment isn't anything to do with however much houses were in 1970, how hard it was then to get a house, or whatever other comments there seem to be going around. This is purely a blame game that pits generations against each other for no reason other than to create unnecessary divides.

 

The issue is how much faster prices are outpacing salaries at this moment. For example, we bought a house around 8 years ago actually... exactly 8 years ago today, in that time it's value has almost doubled.... Our earnings have increased as would be expected, but by no means have they doubled. My house is a simple 2 up 2 down mid terrace in an area that is not particularly "nice" or expensive. If we were to look now at buying the same place as first time buyers, we would be living with our parents still. The other issue with the speed of the increase, for example a couple who between them earn £50 k, a bank will on average lend 4.5 times salary (apparently), so a maximum mortgage of £250 k is available to them. They talk to their bank in June 2021, the average house price is £265 K, based on that they need a £26500 deposit (10%). They save like mad to have this deposit and finally reach their goal in July 2022... The house price is now £292,000, the bank will still only lend them a maximum of £250 K, so with their saved deposit, they have £276500... they now need another £15500 to be able to buy the average house... Even with a 10% increase in salary, which is far more than realistic to budget for, they still can't borrow enough to cover the shortfall. The cycle keeps going like this as the house prices increase beyond the scope of salaries. 

 

https://propertydata.co.uk/charts/house-prices

https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householddisposableincomeandinequality/financialyearending2021#:~:text=Median household disposable income in,(ONS) Household Finances Survey.

https://www.onlinemortgageadvisor.co.uk/mortgage-affordability/how-many-times-wage-borrow-mortgage/

[tegs07]

The former governor of the bank of England, Mervyn King  once said “house prices are a matter of opinion, debt is real”.

 

The debt is dependent upon affordability which is dependant upon interest rates.

 

House prices are no longer tied to (sensible) salary (multiples) as the criteria for purchase IMO but are totally dependent upon access to cheap credit. Remove this from the equation and what houses are really “worth” will be revealed.

 

My personal opinion is that two decades of ultra cheap credit has distorted the economy entirely, shifted asset ownership into the hands of people who can afford the risk of loading up on cheap credit and made the risks far higher for those on the first rungs of the ladder. This disproportionately affects the young.

 

Edited October 11, 2022 by tegs07

[Tim2291]

50 minutes ago, cheddatom said:

I was interested to see if I'd been hoodwinked by the media into thinking property prices had risen much faster than salaries.

 

The current figures are easy to find from the ONS: 

 

Average weekly earnings were estimated at £601 for total pay, and £565 for regular pay, in May 2022

 

Older figures are harder to come by..

 

At October, 1970, the provisional figures of average weekly earnings of full-time manual workers were £28 Os. 11d. for men aged 21 years and over, and £13 19s. 10d. for women aged 18 years and over.

 

I found an "old to new money" converter online. I've no idea if this is correct, hopefully some members can tell me? It's saying £28.05 for men, £13.49 for women. I don't really have time to find out how many women worked etc. to find the true average but to be generous let's say £28

 

So pay has gone from £28 to £601 from 1970 to 2022 or a 21.5 fold increase

 

Trying to find house prices...

 

At the start of the 1970s the average house price was £4,057
...
And now in June 2022, house prices have reached a record high of £271,613

 

So a 67 fold increase, or more than triple the increase in pay.

https://api.parliament.uk/historic-hansard/commons/1971/jan/28/average-weekly-wage

 

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/averageweeklyearningsingreatbritain/july2022#:~:text=Average weekly earnings were estimated,(COVID-19) pandemic.

 

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

 

Like I said, I really don't begrudge anyone's success in the property market. These are the facts and it's not a personal insult to anyone.

 

Sadly these house prices are already miles out the average house price is now £286,000 (that's UK wide not England).

 

Splitting it by region houses are more affordable in the North than the South(prices are still pretty crazy). According to statista and Gov.uk the average salary in he north east is £27515, and the average house price is £157924, just under 6 times an average salary. In the South East, the average salary is £32810 and the average property is £390513, nearly 12 times the average salary! 

 

https://www.gov.uk/government/news/uk-house-price-index-for-june-2022

https://www.statista.com/statistics/416139/full-time-annual-salary-in-the-uk-by-region/

 

 

[cheddatom]

11 minutes ago, Tim2291 said:

...I think the biggest issue at the moment isn't anything to do with however much houses were in 1970, how hard it was then to get a house, or whatever other comments there seem to be going around. This is purely a blame game that pits generations against each other for no reason other than to create unnecessary divides...

 

I don't see any blame being apportioned. It seems to be imagined. Similar to those who don't acknowledge their own privilege, the mere mention of them having it slightly easier than other people is taken as a personal slight, as though they are personally to blame for other people's difficulties, which is not the case at all.

[EBS_freak]

Just checking - I can still stand by my statement then?

[Dan Dare]

14 minutes ago, Tim2291 said:

This is purely a blame game that pits generations against each other for no reason other than to create unnecessary divides.

 

Thank you. It's what I was attempting to say when I responded to the claim that we "boomers" had it easy, bought cheap property, etc. It's sad to see how ordinary people are being duped into attacking each other and fighting over crumbs. 

 

5 minutes ago, cheddatom said:

 

I don't see any blame being apportioned. It seems to be imagined. Similar to those who don't acknowledge their own privilege, the mere mention of them having it slightly easier than other people is taken as a personal slight, as though they are personally to blame for other people's difficulties, which is not the case at all.

 

 

This is rather disingenuous. Telling someone who has worked for 50 years and earned average wages at best that they "had it easy/easier" or that they don't "acknowledge their privilege" is a slight, however you dress it up. 

[Dad3353]

1 hour ago, cheddatom said:

... It's saying £28.05 for men, £13.49 for women...

 

£13 19s 10d should be 'converted' to £13 99p, or rounded up to £14. 

[Dad3353]

2 hours ago, BigRedX said:

 

Actually it is - the origin is from a R4 comedy program.

 

My Word..! Which one, though..? 

[neepheid]

We have a house.  We've had a few wobbles along the way trying to keep it (bass fire sales, debt restructuring etc.) so frankly I don't care how easy/difficult it is/was for other people.

[tegs07]

2 minutes ago, neepheid said:

We have a house.  We've had a few wobbles along the way trying to keep it (bass fire sales, debt restructuring etc.) so frankly I don't care how easy/difficult it is/was for other people.

I’m always concerned about how difficult it is for people. Having secure shelter is a fundamental requirement. It shouldn’t be a luxury or a casino.

[EBS_freak]

[cheddatom]

4 minutes ago, Dan Dare said:

This is rather disingenuous. Telling someone who has worked for 50 years and earned average wages at best that they "had it easy/easier" or that they don't "acknowledge their privilege" is a slight, however you dress it up. 

 

Pointing out the fact that property was easier to buy is not a slight at all! No-one is saying boomers don't deserve what they worked hard for.

 

My parents also worked hard for 50 years, however, they don't take the fact that property was easier for them to buy as a personal insult. It's just a fact of life.

 

If a woman points out to me that my gender has made it easier for me to earn more money than them, I'm not going to take that as a slight, because I'm aware that it's a fact.

[EBS_freak]

Every time that I think about replying, @cheddatom already got there.

 

The key point is, times have changed... and as pointed out, people find it hard to acknowledge privilege. The fact that a lot of us were born in the UK affords us with a lot of privilege from the word go, no matter where about on the economic scale you exist. 

[Grimalkin]

https://www.theguardian.com/business/ng-interactive/2021/mar/31/uk-housing-crisis-how-did-owning-a-home-become-unaffordable