For First Time Buyers at £250,000!!

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Tuesday 3 August 2004 9.38am
So Acorn Homes are selling apartments in 52-56 Lant Street priced from 250,000 aimed at first time buyers!!

Is this a joke or what

rm
Tuesday 3 August 2004 10.03am
or what is the answer.

it's ridiculous and very depressing.
Tuesday 3 August 2004 10.40am
I think you'll find many first-time buyers pay rather more than even that!
Tuesday 3 August 2004 10.41am

indeedy. so, if the bank will let me borrow 4 times my earnings I need to be earning 50k pa plus have a 50k deposit (plus fees tax etc..)

(groans)

bring on the house price crash please!
Sal
Tuesday 3 August 2004 10.51am
My thoughts exactly. Even properties outside SE1 are expensive. I was looking into the shared ownership scheme, even that is really expensive.
Wednesday 4 August 2004 8.15am
There will not be a house price crash, It's just something talked up by depressing British journalists.

If you look at any structural economic indicators, the basic value of current house prices remains strong. Supply is basically afffected by how many new homes come on to the market - this is very weak in the UK due to tight planning and lack of space, meaning supply is weak.

Demand is affected by many factors - unemployment is extremely low and set to stay that way, earnings are fairly stable. Also, the number of 'househoulds' is set to increase further as demographics change and people get married later/ stay single longer.

So, you have weak supply and strong demand. The government is tightening its monetary policies and increasing interest rates but this only affects cost of borrowing and only has limited affect of overall demand.

Unless one of these factors changes dramatically, you're not going to see any form of crash. The Daily Mail and Express have been touting this for the past 3 or 4 years and they've been consistently wrong.

Also - I'd say that 250k is a reasonable sum for a new home in London these days, it is about the going rate.
rm
Wednesday 4 August 2004 9.02am
I'm sorry JGarcia but (although you may be right about supply and demand) how can you say that 250K is a "reasonable sum". It may be the going rate, but reasonable it ain't!

If average people can't afford to buy houses in London, then they will be forced to leave and live elsewhere. This means that people (private and public sector) will struggle to recruit which will have an adverse effect on the economy. With tuition fees and massive student debt people are unable to buy a house.

The housing market cannot be sustained if no first time buyers exist.
Wednesday 4 August 2004 9.50am
According to the Times last week, the average starting salary for a 21 year old grad in London is 30K rising to 50k after 2 years. This pool of first time buyers will always exist and seem to have little difficulty jumping on the home ownership ladder - by 28 most will be on 60k to 70k with all student debts paid off. 250k for a flat will be always reasonable to everyone who can afford it
rm
Wednesday 4 August 2004 11.07am
And what jobs are they doing? I graduated a few years ago from LSE and most of my fellow grads went into the city. They started on around 24K. Now, coming up to 28, NONE of them are on anywhere near 60-70K and they haven't paid off all their student debts.

Can London survive solely on bankers and city workers? What about teachers, police, nurses etc? They have to live somewhere. They don't earn anywhere near that money and can't afford to buy a house in London - so they move elsewhere. What happens then? Of course, it won't affect those people earning 70K as they will pay for private services.

The point is that to the AVERAGE person 250K will never be a reasonable amount for a small (probably 1 bed) flat.

The rich get richer and the poor get poorer....

(edited for typo)



Edited 1 times. Last edit at 4 August 2004 11.07am by rm.
Wednesday 4 August 2004 11.07am
I'm sorry, but I don't believe that. 50% of youngsters now have degrees (in sport & sunbathing, many of them). They don't get 30k starting salaries.
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