£144,000 p.a to keep up with London house prices...

[Uncle C]

Depends on who you are. If you're a bright-eyed happy teenager without a care in the world, you probably haven't the vaguest notion yet that you'll be living with your parents til your forty, or you'll have to share a house with five others to afford the rent or you'll have to move away from the area to even stand a chance of getting a place of your own.

But the Government have special deals for poor people, or families can club together to act as guarantors.

 

[Tim Over Whelmed]

Thing is we are supposed to be building houses at the rate of 400,000 a year to meet demand and we're not even building 100,000. These statistics, or similar numbers, have been offered for years so each year we are 300,000 ish behind the line, therefore the prices are going to continue to rise. IF, and it's a mighty IF, we started building homes at the rate of 400,000 a year there would still be demand and prices would still increase albeit slower.

Unless there's a change in policy that makes buy-to-let less attractive and a change in taxation to make empty "holiday homes" less attractive then there won't be a slowing of this problem. It's OK for us old blokes with our property sorted but I really fear for the kids in 10-15 years time (although they'll probably bump me off and life in my gaff!)

Increase taxation on rental income may help but could also push up prices as could increasing interest rates. The only answer is to build more houses and the RIGHT type of houses, we need a huge build of small 2 and 3 bed places that can be purchased at a reasonable price, these "getting your foot on the ladder" properties aren't designed to be the most spacious or on the biggest plot, just to ease demand. Once in them you can start to plan for the next step. Stop building 5 and 6 beds on large plots and start also building council owned smaller houses.

 

[seagullsovergrimsby]

It must be depressing when looking to buy in London, the Metro carries details of new developments on a regular basis, and it always seems that prices are from £350,000 which is for a one bedroom apartment. Unless you want to live in a riot area there is little or no chance of affording that.

Property prices in Croydon have rocketed 20% in the last year despite being regarded as the London equivalent of Moss Side or Toxteth.

 

[Tom Hark Preston Park]

Germany has a much higher rental percentage than the UK. Would be interesting to hear the take of some of our German correspondents here.

 

[Uncle C]

Property prices in Croydon have rocketed 20% in the last year despite being regarded as the London equivalent of Moss Side or Toxteth.

There's always one who wants to tell us how much money they've made, and that's good. What else would we talk about at barbeques and diner parties?

 

[nicko31]

Germany has a much higher rental percentage than the UK. Would be interesting to hear the take of some of our German correspondents here.

On the subject of Germany probably the perfect time to sell up in London and buy in Berlin, a weak Euro, prices per sq/ft at a fraction of London and an economy built with a long term view rather than piles of public and private debt, both of which are at unsustainable levels.

When things get to the stage the average London homeowner makes 4 years salary for doing nothing you know somethings not right

 

[Uncle C]

On the subject of Germany probably the perfect time to sell up in London and buy in Berlin, a weak Euro, prices per sq/ft at a fraction of London and an economy built with a long term view rather than piles of public and private debt, both of which are at unsustainable levels.

And surrounded by Germans banging on about how good they are at football.

 

[seagullsovergrimsby]

On the subject of Germany probably the perfect time to sell up in London and buy in Berlin, a weak Euro, prices per sq/ft at a fraction of London and an economy built with a long term view rather than piles of public and private debt, both of which are at unsustainable levels.

On the down side you may have Herr Tubthumper as a next door neighbour boring you to death with tales of the German railway system and real ale festivals

 

[nicko31]

Equally depressing that there will be a further knock-on effect on Brighton house prices as more and more London-based would-be buyers give up the chase and price local would-be buyers out of their own town.

Remember in the early 90's a mate of mine bought a studio in Brighton at a repo auction for £10k, incredible how things have changed

 

[seagullsovergrimsby]

Remember in the early 90's a mate of mine bought a studio in Brighton at a repo auction for £10k, incredible how things have changed

One of my work colleagues who transferred up to Grimsby bought a studio flat in Hove for £50k on a 100% mortgage in 1989 only to find it was only valued at £15k in 1992 so he handed the keys back to the building society and even though it was later sold at auction for £13k he was never chased by the building society for the difference.

 

[Uncle Spielberg]

One of my work colleagues who transferred up to Grimsby bought a studio flat in Hove for £50k on a 100% mortgage in 1989 only to find it was only valued at £15k in 1992 so he handed the keys back to the building society and even though it was later sold at auction for £13k he was never chased by the building society for the difference.

They have 12 years to try and get the debt back so it is written off by now.

 

[The Antikythera Mechanism]

The UK will become like the rest of Europe with 70% of people renting, not because they want to but because they have no other option. This will get worse from 2015 when people getting their pension pots can get the whole lot in cash and will result in landlords building portfolios of rental properties as their pension income.

Good point.

 

[beorhthelm]

Remember in the early 90's a mate of mine bought a studio in Brighton at a repo auction for £10k, incredible how things have changed

tell me about it. you could get grants to do up houses in the mid 90's, buy a townhouse for about 50-60k as i recall and get the same again to refurb it. i was encouraged to pursue this by a builder (who had appalling credit so couldnt take it on) but decided i didnt want to get tied down with a mortgage at that age. sort of property looked at is worth 700k +

 

[Uncle Spielberg]

Good point.

The problem now is even renting will be out of the reach of many people. I have a friend who wanted to rent somewhere for £ 900 pm and she had to prove a £ 35k pa income which she could not. It is impossible to buy or rent down here if on a single income and that is why kids will be living with mum and dad until they are 40 plus and then inherit the family home and you have 40 and 50 year old somethings living in other people's spare rooms. It is a real issue for this Country.

 

[The Antikythera Mechanism]

The problem now is even renting will be out of the reach of many people. I have a friend who wanted to rent somewhere for £ 900 pm and she had to prove a £ 35k pa income which she could not. It is impossible to buy or rent down here if on a single income and that is why kids will be living with mum and dad until they are 40 plus and then inherit the family home and you have 40 and 50 year old somethings living in other people's spare rooms. It is a real issue for this Country.

For someone to achieve a 6% gross return buying a property to rent out at £900 pm, they can't afford to pay more than £180k. The market is, somewhat, limited to new investors because when you factor in service charges, maintenance etc, the returns diminish. I've just bought a one bed flat, secure underground parking & entry phone for £115k. There is already a tenant,insitu, paying £650 pm, so a reasonable return.

 

[Herr Tubthumper]

But I thought rising house prices were a good thing.

It is for people who own multiple properties/buy-2-lets.....like 1/3 of the government do.

 

[beorhthelm]

It is for people who own multiple properties/buy-2-lets.....like 1/3 of the government do.

in Germany where renting is more the norm, who owns those properties?