stevensfo wrote:BullDog wrote:scrumpyjack wrote:I suspect the market thinks the biggest risk for housebuilders in a sharp rise in interest rates reducing the amount buyers can borrow and triggering a fall in house prices. Such falls have happened in the past and sometimes even dented the 'ladder' delusion whereby people think house prices can only ever go up.
Indeed, there's massive unaffordability problem. Even in what is not an expensive part of the world here, a one bedroom apartment is around £200,000. Typical salary, sub £30,000. Add in to that student debt, imminent huge energy price increase, increased taxation, car ownership/lease, pension savings........ The numbers don't really add up. It's been a long time coming. But a big drop and/or long term stagnation in property prices has to happen. Doesn't it? The present situation does not seem sustainable to me.
But a big drop and/or long term stagnation in property prices has to happen. Doesn't it? The present situation does not seem sustainable to me.
I've been saying the same for about 20 years now!
Steve
I quite agree. But one day the government will not be able to kick the can down the road anymore. Nobody is more surprised than I am how ridiculously out of kilter wages and housing has become. As I say, even in my modestly priced area, first time buyers are looking at 6 to 7 annual salary to buy somewhere to live. I believe long term average in the area is maybe 2.5 to 3x? It's not sustainable very long term? Is it?