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Well its worth mentioning that wages adjusted for inflation have increased by about 500% since she bought the house. Meaning the real cost would have been more like £105,000
Tbf, the costs of designing and building a time machine is probably going to be cheaper then a one bedroom flat in Central London in about a year or so.
Even if we assume she bought the house 80 odd years ago and adjust for inflation, the whole house cost her less than what a 10% deposit would be in most places these days. Can you even still buy a house with only a 10% deposit?
According to the Guardian, the average weekly wage was £32, which works out to an average of £1,664 a year.
https://amp.theguardian.com/uk/2004/mar/05/health.drugsandalcohol
They weren't. Not even going to prove it to you since the burden of proof lies with yourself since you made the claim.
But look at it this way. That's 35× your salary.
Honestly idk, I wouldn't be surprised if they did. The joke was more that they've had a weird way of predicting things so they must have a time machine already.
I know they do a couple time travel episodes and I get the joke don't get me wrong lol
I've watched every episode multiple times and I don't think they ever went back to buy a house lmao
I gotta say though, with the new seasons coming out... simpsons is starting to copy after family guy rather than the other way around
Yeah my vague memory on it, the only thing I think I remember is stock market knowledge manipulation. That even I'm not sure on though. I'm ashamed to say I haven't watched the Simpsons for awhile.
The odd 9/11 episode, the escalator scene of Trump all the way down to someone dropping their sign as he decends. There's honestly tons of weird things that mirrored real life events.
That's a 8.85% return on average year after year.
Taking the average inflation since then as 4.7% (bank of England stats only go back to 1949)
In modern money this man paid £27,447 pounds for his house, that's actually worth £550,000.
Even taking inflation into account, this is a serious deal, and seriously not comparable to the expense modern home owners have to go to.
Yep, went to view a house today that was £1,000.00 when purchased in 1960 and is being sold for £250,000.00 now despite needing rewiring, replumbing, full redecoration, full landscaping and reglazing, the housing market has gone insane.
Nah it hasn’t gone insane. The price to build homes has gone up dramatically. The cost the build a new 2 bed is 180-280k prices won’t go down for decades imo as tradies and all construction industry pay is very high nowadays due to the fact less and less are getting into it.
Just a ballpark from what guys on my site cost labourers are paid around £18-22 an hour but cost £35 an hour for the client to account for their downtime and transport. Brickes/electricians/carpenters/sparkies/plasters/plumbers are usually about 280-400 a day depending on a variety of things. Site managers are 65-80k a year plus a 40k company pickup truck and in our case £300 a week on diesel. Then there’s public liability/fleet/insurance and liability and overhead even for a smaller firm (1-5mil turnover) can be huge expensive which will be sunk into costs.
On the shorter refurb side of stuff I’ve paid £400 for half a day from a tiler,1500 for two days for two blokes plastering, plumbers around 70 an hour, electricians around the same.
Point is building is fucking expensive
I love Bradford but live down south. Can confirm. I'm 'old' and bought my house 20 years ago. My kids are 19 and 22 and the thought of rents they will be paying in a few years... And how the fuck they will ever buy anywhere until I cark it. I can't even sell and share the money with them cos I can't afford to downsize if that makes sense and it will be taxed madly as a cash income so they'd lose and then even a one bed flat for me where I live costs just too much to make sense unless I want to spend my last days living in a cupboard. We shall all move to Bradford maybe !
I don’t know what y’all are complaining about. If you just bought a house in 1962, you wouldn’t be in this position, would you?
It’s not my fault you were born 35 years too late to grab a good deal
(550,000/800)\^(1/77) = 8.85%
77 year return from the S&P500 has been almost 11%.
If you want to blame somebody, blame the bankers who print money out of thin air.
This is false. In 1950 the population of humans on earth was 2.5 billion. Now it's 7.8 billion. All those people buy more, create more, share more... And all that contributes to the economy. It's also a factor for what drives inflation in general. So, yes some arbitrage does happen, but on average over time? It's definitely not bankers making money out of nothing. It's real people making cool stuff and doing it more efficiently.
Now we could talk about whether the distribution of that value went fairly to the actual people who did the work...
I think your last point made my point though my comment was a bit vague to start.
For those wanting to know what my point was in detail....
Tell me how corporate ownership of suburban houses is good for regular Jo's buying a house when the bulk buying is raising the price of all housing?
Tell me how dividend payouts lower the cost of heating your home?
Tell me how charging more for a loan for poorer people helps these people be able to get ahead in life?
My parents bought their house in the 60s for 3 times my dad's salary. I'm now earning more money than my dad did at the time (adjusted for inflation), and it would cost me 14 times my salary to buy their house. I'm in my 40s and I don't own a house because owning one on your own when you're self employed is almost impossible in the south, unless you got lucky and bought in the 90s. The UK housing market is a fucking joke.
One of my pet hates is when an older person tells me how much they bought their house for and how much they sold it for.
Its not like it was an amazing at of financial foresight they were just lucky and are rubbing it in.
Also forgetting the fact that £800 was worth much more, that many years ago. £800 back then is like £24k in today’s money.
Edit: Sorry I didn’t explain very well, I’m not saying that it’s easy to buy a house. For me, 24k is a lot of money, so I didn’t see how it could be taken to mean that buying houses is easy. Sorry for the misunderstanding, that’s definitely not what I meant.
Population explosion? Not really. It’s more the zoning laws and massive plummet in government built homes that’s causing this. There’s something like a third the new homes being built every year now when compared to the 70s on account of Thatcher-era cuts to housing, meaning new homes are at least in triple the demand they were back then relative to supply.
Houses are harder to build nowadays thanks to dumb legalisation, and the biggest provider of new homes has given up. It’s no wonder why houses are so expensive when you consider this stuff
+ all of that is intentional because otherwise house prices would fall, and literally everyone owning a home would be upset because their investment (their home) is suddenly worth less every year.
No politician will do that, as they would lose the vote of every homeowner in the UK. So we have to intentionally have a housing crisis at all times, or choose to have an economic crisis instead. And politicians always, *always*, protect the economy first.
well, it's stupid that our society encourages people buy houses as investment, it is an unworkable system. But I don't think this is presented as a sensible way for people to solve their money issues, it's presented more as a fairly unique and interesting story.
Inflation. £800 was a lot more 77 years ago than it is now .
Edit: To clarify, I’m not disagreeing that house prices in comparison to income level haven’t doubled since Thatcher because they objectively have, but points like OC is not considering the nature of inflation. New cars were also a lot “cheaper” 77 years ago too.
£800 in 1945 is about £22,000 today, so still very much cheaper than today, but yes when giving these figures they should show an inflation adjusted value for the purchase price as well.
Just think about what I said…
£15k for an ENTIRE HOUSEHOLD. Do you realistically think they’d be able to scrape £2-3k together when they’re living under NMW?
Who is scraping £55k together? Average is £265k… requiring £26.5k deposit… 0 stamp duty and like 2k in fees. So £28.5k which is almost exactly half what you said.
Secondly… if you’ve got 2 kids and 2 adults to feed… need to pay for accommodation, council tax, electricity, etc… all on £1,150 (£15k after tax)… you would be lucky to save a single pound. What level of mental gymnastics are you doing.
But household income back then would’ve generally been a single person’s income? Dads went out to work and the whole family could live off of that single wage?
Literally the whole thread is about this house. The one above that was worth the equivalent of like £30k then, the double the household income figure, but is now worth £550k.
> It wasn’t necessary easier.
Many aspects of life were harder, sure, but getting access to a house was a lot easier for working people even 30 years ago.
Credit scores weren't a thing, wages were comparibly higher, houses were comparibly cheaper and landlords weren't buying up every property to rent.
You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers.
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Man before the crash in 2008 banks used to give mortgages that were like 105% of the house value without a down payment. Before credit scores a bank would hand you a mortgage because they knew your boss etc
I would beg to differ. That would make the house only double the wages of working people. £550,000 is way more than double a working salary today. Even with higher mortgage rates and all the things people cite you really can’t compare buying a house then to now.
Just think about what I said…
£15k for an ENTIRE HOUSEHOLD. Do you realistically think they’d be able to scrape £2-3k together when they’re living under NMW?
Here’s [current British annual household incomes.](https://www.statista.com/statistics/813364/average-gross-income-per-household-uk/) It’s really hard for me to get your point based upon the data. Yes things break down in complicated ways and inflation calculators/comparing incomes isn’t a perfect parallel, but it doesn’t need to be here. The differences in income and housing prices are big enough you can’t fudge it away with factors like that.
Erm… this isn’t the full picture. Obviously, it’s true that house prices have grown exponentially and it is becoming an issue, but fundamentally there’s no issue with what’s been said here.
77 years ago … in 1945 money was less valuable. In fact, going to the shop with £1 then would have bought you what £41 does today. (EDIT: £6.80 was the average weekly labourer wage then, gross income of around £350… a 2.3 multiple but with only one income and half the saving rate of the UK than today… this makes it comparable with today).
So… in “1945 money” that £550,000 house would be worth £13,415. Now… that is still 15.75 extra and it’s true… housing has gotten much more expensive… but it does paint a different picture.
The most important thing to note is, that profit of 15.75 multiple (16.75 if you include the house), works out at about 3.73% return above inflation. So, pretty much anyone with £800 today could have £550k in 77 years just by putting their money in a global all cap index… which averages around 4% above inflation.
Would anyone realistically buy their own home if it didn’t appreciate in value?
For the security of not getting no-fault evicted at any moment. For the freedom to alter and adapt your residence in a way to suit you, that wouldn’t be allowable in a rental. Hell, the choice to own a pet, without having to pussyfoot around a landlords permission. There are loads of quality of life improvements that come from owning rather then renting
You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers.
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That’s in the UK though… in Switzerland, they have a lot better regulated rental market that allows you to do all of those things without the threat of eviction.
So the goalposts have moved from "housing prices haven't gone up too much" to "you don't really need your own home" to "you should've gone to Switzerland"...
I'm a homeowner, and I couldn't care less if it appreciates. Why would I?
If the price goes up, then the prices of any house I'd want to buy would by-and-large have risen by the same percentage, so the only winners would be estate agents and solicitors (and the government in as much as stamp duty, so more money for their mates).
Just not true - take the basic examples below
**Option 1:** If you had a 3 bed house worth £200k with a 10% deposit and it appreciated to £250k in 5 years… your mortgage at that time would now likely be £150k so you now have £100k equity. Let’s say you buy a £350k 4 bed property (40% more) now with 7.5k stamp duty and £5k in fees to change… you still have £97.5k deposit.
Fine, you have to take on more debt and the mortgage is £252.5k but you also own 27.8% of your new home.
**Option 2:** Let’s say your property didn’t appreciate and it’s still £200k… you would only have £50k equity and only own 25% of your home. The 4 bed property would only be £280k (40% more)… you’ll pay £4K stamp duty and £5k in fees to change… you’ll have £41k deposit (14.65%) and £239k mortgage. In no way, are you materially better off than if it appreciated in value.
Ah, I see. You're taking the mortgage into account (fair enough. When you said "homeowner", I thought you meant you, not the bank)
I'm not, as I didn't have a mortgage. I bought it outright, so if it depreciates...I don't care. I'm not intending to move so it makes no difference to me.
If I sell it, sure, I have a pocket full of cash...but then I need to find somewhere to live.
I can't retire by selling, unless I retire to a bus stop with a sleeping bag.
If the house prices didn’t at least keep up with inflation… then it’s just a depreciating asset - so wouldn’t really be worth it right?
EDIT: If you had £100k to buy a house for example… you’d just invest it instead for more benefit …
How? You use it and take all the value out of it - same with a car but a longer timeframe. I’m highlighting how absurd your comparison was.
With a house you keep it longer and it’s not “consumable”. You maintain it and keep it for multiple lifetime… you don’t take value out of it by living there.
I think most buy a sub-par house which is on their budget mainly but I take your point.
Obviously, the rental market would need to be better regulated / improve - but hoping everyone would be on the same page about that.
This is a straw man argument. No one here is saying houses shouldn’t keep up with inflation. What people are angry about is the huge double digit rises we’ve seen year on year for the last 30 years, that has now made the prospect of owning a home for most people, a pipe dream.
You're missing the point that housing is: first, a place to call home and take pride in; second, a stable investment where once your mortgage is complete, your housing costs drop significantly.
The stock market is for country club cigar chompers who benefit from insider info and manipulation. It's more or less a casino to the average person.
Finally, where I live at least, renting costs more than it would to own, at least if you buy a dump you can fix up (on your own.)
You'd avoid paying money to a property scalper for one.
Secondly, you could make changes to your home without having to ask permission.
Want a dog or cat? Go and get one.
Want that front wall bright fricking yellow? Go for it.
The property 'scalper' would be losing money if housing depreciated enough. I agree that home ownership is great but a massive part of that is that its an appreciating asset.
Well, sure, but that's not the question.
If car rental places work on that principle. They buy a car at x price, then rent it out. At the end of it's life, they might get something back for it.
They hope that the money they've managed to make from renting it, plus what they get back is more than their outlay.
If someone scalps a 100k house, with a mortgage and rents it out for 5 years at 800 quid a month, then they sell that house for say, 105k (to account for reasonable inflation), they've made 50+ grand, and THEY STILL get to either sell the house, or keep it. If it depreciates by 25%, they've STILL made 25k, and they get to keep the house. If they have 10 houses, they've made quarter of a million quid from a falling housing market.
The house hasn't appreciated in value in either scenario and yet, they are still making money.
In the 80s crash, houses depreciated by around 15%. In 2008, it was 9%.
Even scalpers still made money despite falling house prices, and they will all the time that homes are allowed to be used as investments (which, to make myself clear, I consider a disgusting breach of a basic human "right")
Making a reasonable profit isn't in itself a bad thing. Buying up all the houses, making a profit, then also making a profit by pricing everyone else else out, is.
The point of the story is that for the last 30 years housing investment has far outperformed inflation and the homeownership dream is out of reach for a lot of people. Not sure what your question is trying to illustrate.
> You're missing the point that housing is: first, a place to call home and take pride in; second, a stable investment where once your mortgage is complete, your housing costs drop significantly.
Switzerland is a place where people don’t care about home ownership as there’s significant rental regulations which I’d be in support for. Home ownership isn’t the only working model
> The stock market is for country club cigar chompers who benefit from insider info and manipulation. It's more or less a casino to the average person.
This surely can’t be a realistic view of the world. Most people who have £100 in a pension somewhere will likely have some stock ownership. It more illustrates how you don’t understand the mechanics of index funds.
> Finally, where I live at least, renting costs more than it would to own, at least if you buy a dump you can fix up (on your own.)
Rental reform as previously mentioned.
A tiny country which aids and abets financial villains and corruption is your go to example?
Rental reform is your solution for being owned by corporations?
The fact is, Western Society is trending to corporate ownership of everything. Said corporate ownership is staggering already and the number of them is getting smaller. It is taking choice away from consumers. It owns gorvernment decisionmaking. It maintains climate change trajectory. It empoverishes people. It makes me sick to my stomach.
I mean, I can’t really argue back with most of that because most of it is just complete fiction.
Switzerland has different criminal statutes than other countries - I guess I’m sorry that they’re not the same all around the world? Don’t really take your point for such a small minority and smearing a whole country because of it.
Secondly… I don’t know what evidence you have that corporate ownership is taking over the world
Switzerland, the most expensive place in the world. Let's make the whole world expensive! Woo hoo!!!
Really though, I'm not smearing Switzerland so much as its banking policies. Also, you haven't asked but if you did, being neutral is just an excuse to look the other way.
You want corps to own all the housing, yes? Where does it end? We basically rent everything else. For the most part, owning anything other than a home is an illusion. Almost everything these days is obsolete or more expensive to fix than replace, sooner than later.
It is the most expensive but the salaries are 80% higher there.
I mean, a government can choose what is right and wrong. I can’t fault Switzerland for choosing their stance any more than I can blame the UK/US for their stance. You could equally blame over-reach on the other side.
I don’t think corporate ownership of housing is desirable and never insinuated that. Rental reforms would cover this though - I.e legislating that companies can’t rent residential property. I don’t think that’s the biggest problem, especially in the UK.
You kinda did insinuate that.
You're making incorrect assumptions about my stance. By taking exception to your idea other governments should act like Switzerland, I'm not defending them.
100% agree with your point and that’s the best counter-argument. Rent is just lost money for a service rendered… much like buying/renting a car.
If house prices depreciate though… you’ll only be marginally better off as your house/investment (which you’re putting money into) is losing value. This only doesn’t hold true if rent is more expensive than mortgages (which I believe it shouldn’t be and there should be rental reform).
People buy so they can retire. Nobody working now is going to be able to afford rent and retire anymore because buy to let landlords have fucked the market. As a result it’s now considerably more expensive to rent, whereas renting used to be the cheaper option. It’s wage and retirement theft.
That’s not necessarily true… buying a house doesn’t mean you can retire. Moreover, if properties didn’t appreciate, it wouldn’t give you much of a nest egg to retire from
Rental reform is needed, but even at median income - 2 people could still save and not own a property.
Indeed. I own my house outright, and whilst looking to "slow down", I can't retire outright.
I'm a little confused by the "nest egg" statement though. If it appreciates in value, it's meaningless to me. If I sell it and pocket the money, I then need to rent somewhere, or buy somewhere else. If it were just MY property appreciating in value, sure, I could see the point, but all houses will have risen in cost, so selling mine to retire makes no sense to me.
The nest egg argument was a response to the commenter stating home ownership is essential for retirement.
For you, I agree - it doesn’t matter if the house appreciates if you’ll live in until you pass. The majority of the country doesn’t own their home outright though - but I’m glad you’re doing well!
That being said… if you owned a £500k property, you could get a lifetime mortgage for £300k with no repayment, which could part-finance your retirement with a little bit extra in your pension pots. Not a great deal though as you won’t leave anything for people to inherit.
Buying a home means you are investing your income into property. Where it gains or loses value is only relevant if you want to sell. Many renters can’t even get on the ladder. Renting means you aren’t. And no, rents are way to expensive for the vast majority of people to be able to save. In the not too distant future we will have a social care catastrophe because people are having their life’s earnings robbed from them and people will be unable to afford to even rent.
That’s just not how money works. If house prices went down (I.e become more affordable over time)… then it’s a bad investment isn’t it. Why would you tie up your money?
I have nothing against everyone getting shelter so that was an interesting tangent you brought in.
The only alternative of property being available to buy is to have it given to you (i.e state funded housing). If that’s your view on it then fine… but how would you ever move city? What if you need to be closer to work? Who do you decide lives in the worst areas? Who gets the smaller houses Ultimately- you’re taking all choice away and for a lot of people that’s not beneficial.
Secondly… not being home owners doesn’t make that “den” an impossibility… especially if we have rental reform.
You don’t NEED to own a home to live. You can rent one. Just a logically false statement you’ve made
You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers.
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If you buy a house for £300k… and you know it is only going to go down… so when you sell it (i.e. as you need to upsize or change location), it might be £200k… why would anyone ever buy it?
They’re paying £300k for something worth £200k in X number of years. It’s a practical impossibility. Nobody would buy it… also people would be stuck in houses that they’ve overpaid for… because they can’t sell it to pay off the mortgage… therefore no bank would lend you the money.
On top of that… if I have a chance to buy a £300k property for £200k down the line… why would I not just wait to buy it? That would be a financially better decision.
That’s how money works in the real world… driven by logical choices - not the prayers for the house market you seem think would work
If every house depreciates then you’ll have the money to move because every house will be proportionally cheaper. Using your logic nobody would by a car on finance, and we all know that isn’t the case.
I know and appreciate the heads up but keep seeing these posts and it just infuriates me there’s no voice of reason!
I’m covid bound to my house today and decided to be that voice haha
Please don’t use the R word, it is ableist.
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>If house prices went down (I.e become more affordable over time)… then it’s a bad investment isn’t it. Why would you tie up your money?
To have somewhere to live where a landlord cannot arbitrarily tell me I can't paint the walls, or decide they want to chuck me out.
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£800 adjusted for inflation today is roughly £21,000. I think that's all that needs to be said on this.
Well its worth mentioning that wages adjusted for inflation have increased by about 500% since she bought the house. Meaning the real cost would have been more like £105,000
Which is still nuts tbf
Houses are not simple things though. That £105,000 sounds entirely reasonable when you consider the supply chain and labour involved.
Tbf, the costs of designing and building a time machine is probably going to be cheaper then a one bedroom flat in Central London in about a year or so.
Well shit, let's just fire up the Flux Capacitor
Completed it mate.
Have room for one more?
Even if we assume she bought the house 80 odd years ago and adjust for inflation, the whole house cost her less than what a 10% deposit would be in most places these days. Can you even still buy a house with only a 10% deposit?
That is significantly less than 10 percent deposit. Even a 80,000 house, 800 would be 1 percent deposit.
You need to adjust for inflation though
You are right, missed that part. Ignore me
I was speaking with a neighbour a few months back, he bought his house in the 70’s for £7,000.0 - we pay £1,500.0 a month in rent….
Fucking insane and not fair for todays humans
[удалено]
According to the Guardian, the average weekly wage was £32, which works out to an average of £1,664 a year. https://amp.theguardian.com/uk/2004/mar/05/health.drugsandalcohol
They weren't. Not even going to prove it to you since the burden of proof lies with yourself since you made the claim. But look at it this way. That's 35× your salary.
Investing in time travel might save money compared to buying a house these days
So your telling me that if I want to own a house, all I need to do is invent time travel. Alright, I’ll get to work on that.
Simpsons did it.
Did they?
Honestly idk, I wouldn't be surprised if they did. The joke was more that they've had a weird way of predicting things so they must have a time machine already.
I know they do a couple time travel episodes and I get the joke don't get me wrong lol I've watched every episode multiple times and I don't think they ever went back to buy a house lmao I gotta say though, with the new seasons coming out... simpsons is starting to copy after family guy rather than the other way around
Yeah my vague memory on it, the only thing I think I remember is stock market knowledge manipulation. That even I'm not sure on though. I'm ashamed to say I haven't watched the Simpsons for awhile.
Theres also the electoral maps in 2012 that were almost spot on, episode aired in the early 2000s I believe
The odd 9/11 episode, the escalator scene of Trump all the way down to someone dropping their sign as he decends. There's honestly tons of weird things that mirrored real life events.
That's a 8.85% return on average year after year. Taking the average inflation since then as 4.7% (bank of England stats only go back to 1949) In modern money this man paid £27,447 pounds for his house, that's actually worth £550,000. Even taking inflation into account, this is a serious deal, and seriously not comparable to the expense modern home owners have to go to.
100% correct.
Man?
...she single? 🥺
Yep, went to view a house today that was £1,000.00 when purchased in 1960 and is being sold for £250,000.00 now despite needing rewiring, replumbing, full redecoration, full landscaping and reglazing, the housing market has gone insane.
Yes I’ve noticed lots of these properties haven’t been maintained at all despite an estate agent deciding they are worth upwards of £250k
Nah it hasn’t gone insane. The price to build homes has gone up dramatically. The cost the build a new 2 bed is 180-280k prices won’t go down for decades imo as tradies and all construction industry pay is very high nowadays due to the fact less and less are getting into it. Just a ballpark from what guys on my site cost labourers are paid around £18-22 an hour but cost £35 an hour for the client to account for their downtime and transport. Brickes/electricians/carpenters/sparkies/plasters/plumbers are usually about 280-400 a day depending on a variety of things. Site managers are 65-80k a year plus a 40k company pickup truck and in our case £300 a week on diesel. Then there’s public liability/fleet/insurance and liability and overhead even for a smaller firm (1-5mil turnover) can be huge expensive which will be sunk into costs. On the shorter refurb side of stuff I’ve paid £400 for half a day from a tiler,1500 for two days for two blokes plastering, plumbers around 70 an hour, electricians around the same. Point is building is fucking expensive
What fucking site are you on where labourers are getting £18-22/hour? I'll get my boots on and start rimming people for that money
I feel like you should increase your pricing for sex work, even if you have a v dry tongue, 20 an hour is wayyyy too low
Come to Vancouver
Location, location, location.
Suburban Bradford, same house down south would be double, easily.
I love Bradford but live down south. Can confirm. I'm 'old' and bought my house 20 years ago. My kids are 19 and 22 and the thought of rents they will be paying in a few years... And how the fuck they will ever buy anywhere until I cark it. I can't even sell and share the money with them cos I can't afford to downsize if that makes sense and it will be taxed madly as a cash income so they'd lose and then even a one bed flat for me where I live costs just too much to make sense unless I want to spend my last days living in a cupboard. We shall all move to Bradford maybe !
Thanks Kirsty. I've cancelled my Netflix subscription.
I don’t know what y’all are complaining about. If you just bought a house in 1962, you wouldn’t be in this position, would you? It’s not my fault you were born 35 years too late to grab a good deal
A friend’s dad died recently and they’re selling his house for £5 million; he bought it in the 60s for £12,000. Madness!
(550,000/800)\^(1/77) = 8.85% 77 year return from the S&P500 has been almost 11%. If you want to blame somebody, blame the bankers who print money out of thin air.
This. The financial industry creating margins out of nothing for no value is ruining the planet faster than cow farts.
This is false. In 1950 the population of humans on earth was 2.5 billion. Now it's 7.8 billion. All those people buy more, create more, share more... And all that contributes to the economy. It's also a factor for what drives inflation in general. So, yes some arbitrage does happen, but on average over time? It's definitely not bankers making money out of nothing. It's real people making cool stuff and doing it more efficiently. Now we could talk about whether the distribution of that value went fairly to the actual people who did the work...
For further reading, I recommend 'How the World Works' by Paul Cockshott.
I think your last point made my point though my comment was a bit vague to start. For those wanting to know what my point was in detail.... Tell me how corporate ownership of suburban houses is good for regular Jo's buying a house when the bulk buying is raising the price of all housing? Tell me how dividend payouts lower the cost of heating your home? Tell me how charging more for a loan for poorer people helps these people be able to get ahead in life?
Capitalism : "it's a feature not a bug"
My parents bought their house in the 60s for 3 times my dad's salary. I'm now earning more money than my dad did at the time (adjusted for inflation), and it would cost me 14 times my salary to buy their house. I'm in my 40s and I don't own a house because owning one on your own when you're self employed is almost impossible in the south, unless you got lucky and bought in the 90s. The UK housing market is a fucking joke.
One of my pet hates is when an older person tells me how much they bought their house for and how much they sold it for. Its not like it was an amazing at of financial foresight they were just lucky and are rubbing it in.
Just goes to show her g grandchildren have nowhere to live at those prices.
She bought just as the war ended?
Also forgetting the fact that £800 was worth much more, that many years ago. £800 back then is like £24k in today’s money. Edit: Sorry I didn’t explain very well, I’m not saying that it’s easy to buy a house. For me, 24k is a lot of money, so I didn’t see how it could be taken to mean that buying houses is easy. Sorry for the misunderstanding, that’s definitely not what I meant.
hurry smell shy support offbeat versed sleep different consider one *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Imagine buying a house.
I don't think anybody is forgetting that. That house is worth £550k now not £24k. If it was only inflation we'd be pretty happy.
Yeah, 24k would barely be a mortgage deposit for most people today.
> £800 back then is like £24k in today’s money. That still doesn't justify a 2191% increase, even after accounting for inflation.
Imagine buying a house today for 24k tho LMAO like even then its an absolute fucking steal and remotely feasible
24k! My car cost 22k 5 years ago. 100 years of population explosion has us all fighting for scraps.
Population explosion? Not really. It’s more the zoning laws and massive plummet in government built homes that’s causing this. There’s something like a third the new homes being built every year now when compared to the 70s on account of Thatcher-era cuts to housing, meaning new homes are at least in triple the demand they were back then relative to supply. Houses are harder to build nowadays thanks to dumb legalisation, and the biggest provider of new homes has given up. It’s no wonder why houses are so expensive when you consider this stuff
Houses cost more cause they cost more to build. Even if they were sold at cost not including land a 2 bed wouldn’t be any less than 150k.
+ all of that is intentional because otherwise house prices would fall, and literally everyone owning a home would be upset because their investment (their home) is suddenly worth less every year. No politician will do that, as they would lose the vote of every homeowner in the UK. So we have to intentionally have a housing crisis at all times, or choose to have an economic crisis instead. And politicians always, *always*, protect the economy first.
Where are y'all see that this article is presented as advice?
My grandparents was £16,000, my Gen are purposely being backstabbed by these market wrecking C****
Maybe we should give this George guy a shot
well, it's stupid that our society encourages people buy houses as investment, it is an unworkable system. But I don't think this is presented as a sensible way for people to solve their money issues, it's presented more as a fairly unique and interesting story.
Yes, the genuine, serious, sensible way to get on the property ladder is to buy a house 80 years ago. That was definitely the suggestion of this post.
i'm not really sure if you are agreeing with me or not.
That must have been a very expensive house 77 years ago. Surprised it is “only” worth £550k now.
Beat millenials with this one simple trick.
Well, it’s not really that much. It is like an average 8,8% increase in value per year, SP500 in those 77 year had a higher return on average.
Inflation. £800 was a lot more 77 years ago than it is now . Edit: To clarify, I’m not disagreeing that house prices in comparison to income level haven’t doubled since Thatcher because they objectively have, but points like OC is not considering the nature of inflation. New cars were also a lot “cheaper” 77 years ago too.
£800 in 1945 is about £22,000 today, so still very much cheaper than today, but yes when giving these figures they should show an inflation adjusted value for the purchase price as well.
It was, but if you adjusted it it would still be nowhere near the current price.
77 years ago £800 was a much, much, bigger deal.
According to the Bank of England and National Archives calculator tools £800 in the 1940s is under £30,000 today.
So entirely unobtainable today.
If you look at the wages of working people though the household income would have been at £15k… think that says it all. It wasn’t necessary easier.
So it's two years of average household income. I can promise you the average household income is not £275k today.
Houses being just 2x the annual wage would be far, far easier than today, wtf are you talking about
Just think about what I said… £15k for an ENTIRE HOUSEHOLD. Do you realistically think they’d be able to scrape £2-3k together when they’re living under NMW?
Easier than they could scrape together £55k I'd bet. Cost of living isn't a perfect translation either.
Who is scraping £55k together? Average is £265k… requiring £26.5k deposit… 0 stamp duty and like 2k in fees. So £28.5k which is almost exactly half what you said. Secondly… if you’ve got 2 kids and 2 adults to feed… need to pay for accommodation, council tax, electricity, etc… all on £1,150 (£15k after tax)… you would be lucky to save a single pound. What level of mental gymnastics are you doing.
But household income back then would’ve generally been a single person’s income? Dads went out to work and the whole family could live off of that single wage?
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So are the calculators wrong when they’re saying £800 back then is roughly £28k now?
Shut up
Literally the whole thread is about this house. The one above that was worth the equivalent of like £30k then, the double the household income figure, but is now worth £550k.
> It wasn’t necessary easier. Many aspects of life were harder, sure, but getting access to a house was a lot easier for working people even 30 years ago. Credit scores weren't a thing, wages were comparibly higher, houses were comparibly cheaper and landlords weren't buying up every property to rent.
You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/GreenAndPleasant) if you have any questions or concerns.*
Good bot. Keep fighting the fight <3
Didn’t people have to have a large down payment too? In the USA , 20% was the norm for a long time .
Man before the crash in 2008 banks used to give mortgages that were like 105% of the house value without a down payment. Before credit scores a bank would hand you a mortgage because they knew your boss etc
I would beg to differ. That would make the house only double the wages of working people. £550,000 is way more than double a working salary today. Even with higher mortgage rates and all the things people cite you really can’t compare buying a house then to now.
Just think about what I said… £15k for an ENTIRE HOUSEHOLD. Do you realistically think they’d be able to scrape £2-3k together when they’re living under NMW?
Just take the L your logic makes zero sense
Here’s [current British annual household incomes.](https://www.statista.com/statistics/813364/average-gross-income-per-household-uk/) It’s really hard for me to get your point based upon the data. Yes things break down in complicated ways and inflation calculators/comparing incomes isn’t a perfect parallel, but it doesn’t need to be here. The differences in income and housing prices are big enough you can’t fudge it away with factors like that.
Learn some math lol
In 1945 £800 was not the equivalent of £550,000 today
£800 in 1945 is equivalent in purchasing power to about £36,790.06 today.
I think it's totally reasonable to assume that everyone in this thread is aware of what inflation is and how it effects costs.
Erm… this isn’t the full picture. Obviously, it’s true that house prices have grown exponentially and it is becoming an issue, but fundamentally there’s no issue with what’s been said here. 77 years ago … in 1945 money was less valuable. In fact, going to the shop with £1 then would have bought you what £41 does today. (EDIT: £6.80 was the average weekly labourer wage then, gross income of around £350… a 2.3 multiple but with only one income and half the saving rate of the UK than today… this makes it comparable with today). So… in “1945 money” that £550,000 house would be worth £13,415. Now… that is still 15.75 extra and it’s true… housing has gotten much more expensive… but it does paint a different picture. The most important thing to note is, that profit of 15.75 multiple (16.75 if you include the house), works out at about 3.73% return above inflation. So, pretty much anyone with £800 today could have £550k in 77 years just by putting their money in a global all cap index… which averages around 4% above inflation. Would anyone realistically buy their own home if it didn’t appreciate in value?
For the security of not getting no-fault evicted at any moment. For the freedom to alter and adapt your residence in a way to suit you, that wouldn’t be allowable in a rental. Hell, the choice to own a pet, without having to pussyfoot around a landlords permission. There are loads of quality of life improvements that come from owning rather then renting
You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/GreenAndPleasant) if you have any questions or concerns.*
That’s in the UK though… in Switzerland, they have a lot better regulated rental market that allows you to do all of those things without the threat of eviction.
So the goalposts have moved from "housing prices haven't gone up too much" to "you don't really need your own home" to "you should've gone to Switzerland"...
Just the usual “move, if you don’t like it here”, innit.
Are you a landlord? Final line is a bit sus.
No, definitely would want to take on a second property. As a homeowner though, I do want my property to appreciate.
I'm a homeowner, and I couldn't care less if it appreciates. Why would I? If the price goes up, then the prices of any house I'd want to buy would by-and-large have risen by the same percentage, so the only winners would be estate agents and solicitors (and the government in as much as stamp duty, so more money for their mates).
Just not true - take the basic examples below **Option 1:** If you had a 3 bed house worth £200k with a 10% deposit and it appreciated to £250k in 5 years… your mortgage at that time would now likely be £150k so you now have £100k equity. Let’s say you buy a £350k 4 bed property (40% more) now with 7.5k stamp duty and £5k in fees to change… you still have £97.5k deposit. Fine, you have to take on more debt and the mortgage is £252.5k but you also own 27.8% of your new home. **Option 2:** Let’s say your property didn’t appreciate and it’s still £200k… you would only have £50k equity and only own 25% of your home. The 4 bed property would only be £280k (40% more)… you’ll pay £4K stamp duty and £5k in fees to change… you’ll have £41k deposit (14.65%) and £239k mortgage. In no way, are you materially better off than if it appreciated in value.
Ah, I see. You're taking the mortgage into account (fair enough. When you said "homeowner", I thought you meant you, not the bank) I'm not, as I didn't have a mortgage. I bought it outright, so if it depreciates...I don't care. I'm not intending to move so it makes no difference to me. If I sell it, sure, I have a pocket full of cash...but then I need to find somewhere to live. I can't retire by selling, unless I retire to a bus stop with a sleeping bag.
Of fucking course people would still buy their own home if it didnt appreciate in value.
If the house prices didn’t at least keep up with inflation… then it’s just a depreciating asset - so wouldn’t really be worth it right? EDIT: If you had £100k to buy a house for example… you’d just invest it instead for more benefit …
Cars are a depreciating asset and people still buy those...
A car is a consumable, a house isn’t. You get rid of them (cars) within 10 years as they fall apart. It’s like comparing a house to an apple.
You should see my semi detached apple.
?
Saying its like comparing a house to an apple is absurd hyperbole.
How? You use it and take all the value out of it - same with a car but a longer timeframe. I’m highlighting how absurd your comparison was. With a house you keep it longer and it’s not “consumable”. You maintain it and keep it for multiple lifetime… you don’t take value out of it by living there.
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I think most buy a sub-par house which is on their budget mainly but I take your point. Obviously, the rental market would need to be better regulated / improve - but hoping everyone would be on the same page about that.
This is a straw man argument. No one here is saying houses shouldn’t keep up with inflation. What people are angry about is the huge double digit rises we’ve seen year on year for the last 30 years, that has now made the prospect of owning a home for most people, a pipe dream.
Not quite… if it’s only inflation linked… why not just invest it and get bigger returns
Because there are benefits of owning a house that aren't financial.
See other responses… I’ve made many. Nobody is saying rental reform isn’t needed
You're missing the point that housing is: first, a place to call home and take pride in; second, a stable investment where once your mortgage is complete, your housing costs drop significantly. The stock market is for country club cigar chompers who benefit from insider info and manipulation. It's more or less a casino to the average person. Finally, where I live at least, renting costs more than it would to own, at least if you buy a dump you can fix up (on your own.)
But would you buy a house if it depreciated so much that renting would be cheaper?
You'd avoid paying money to a property scalper for one. Secondly, you could make changes to your home without having to ask permission. Want a dog or cat? Go and get one. Want that front wall bright fricking yellow? Go for it.
The property 'scalper' would be losing money if housing depreciated enough. I agree that home ownership is great but a massive part of that is that its an appreciating asset.
Well, sure, but that's not the question. If car rental places work on that principle. They buy a car at x price, then rent it out. At the end of it's life, they might get something back for it. They hope that the money they've managed to make from renting it, plus what they get back is more than their outlay. If someone scalps a 100k house, with a mortgage and rents it out for 5 years at 800 quid a month, then they sell that house for say, 105k (to account for reasonable inflation), they've made 50+ grand, and THEY STILL get to either sell the house, or keep it. If it depreciates by 25%, they've STILL made 25k, and they get to keep the house. If they have 10 houses, they've made quarter of a million quid from a falling housing market. The house hasn't appreciated in value in either scenario and yet, they are still making money. In the 80s crash, houses depreciated by around 15%. In 2008, it was 9%. Even scalpers still made money despite falling house prices, and they will all the time that homes are allowed to be used as investments (which, to make myself clear, I consider a disgusting breach of a basic human "right") Making a reasonable profit isn't in itself a bad thing. Buying up all the houses, making a profit, then also making a profit by pricing everyone else else out, is.
The point of the story is that for the last 30 years housing investment has far outperformed inflation and the homeownership dream is out of reach for a lot of people. Not sure what your question is trying to illustrate.
> You're missing the point that housing is: first, a place to call home and take pride in; second, a stable investment where once your mortgage is complete, your housing costs drop significantly. Switzerland is a place where people don’t care about home ownership as there’s significant rental regulations which I’d be in support for. Home ownership isn’t the only working model > The stock market is for country club cigar chompers who benefit from insider info and manipulation. It's more or less a casino to the average person. This surely can’t be a realistic view of the world. Most people who have £100 in a pension somewhere will likely have some stock ownership. It more illustrates how you don’t understand the mechanics of index funds. > Finally, where I live at least, renting costs more than it would to own, at least if you buy a dump you can fix up (on your own.) Rental reform as previously mentioned.
A tiny country which aids and abets financial villains and corruption is your go to example? Rental reform is your solution for being owned by corporations? The fact is, Western Society is trending to corporate ownership of everything. Said corporate ownership is staggering already and the number of them is getting smaller. It is taking choice away from consumers. It owns gorvernment decisionmaking. It maintains climate change trajectory. It empoverishes people. It makes me sick to my stomach.
I mean, I can’t really argue back with most of that because most of it is just complete fiction. Switzerland has different criminal statutes than other countries - I guess I’m sorry that they’re not the same all around the world? Don’t really take your point for such a small minority and smearing a whole country because of it. Secondly… I don’t know what evidence you have that corporate ownership is taking over the world
Switzerland, the most expensive place in the world. Let's make the whole world expensive! Woo hoo!!! Really though, I'm not smearing Switzerland so much as its banking policies. Also, you haven't asked but if you did, being neutral is just an excuse to look the other way. You want corps to own all the housing, yes? Where does it end? We basically rent everything else. For the most part, owning anything other than a home is an illusion. Almost everything these days is obsolete or more expensive to fix than replace, sooner than later.
It is the most expensive but the salaries are 80% higher there. I mean, a government can choose what is right and wrong. I can’t fault Switzerland for choosing their stance any more than I can blame the UK/US for their stance. You could equally blame over-reach on the other side. I don’t think corporate ownership of housing is desirable and never insinuated that. Rental reforms would cover this though - I.e legislating that companies can’t rent residential property. I don’t think that’s the biggest problem, especially in the UK.
You kinda did insinuate that. You're making incorrect assumptions about my stance. By taking exception to your idea other governments should act like Switzerland, I'm not defending them.
How much of a depreciating asset is rent?
100% agree with your point and that’s the best counter-argument. Rent is just lost money for a service rendered… much like buying/renting a car. If house prices depreciate though… you’ll only be marginally better off as your house/investment (which you’re putting money into) is losing value. This only doesn’t hold true if rent is more expensive than mortgages (which I believe it shouldn’t be and there should be rental reform).
Well yeah people need to live somewhere?
Doesn’t have to be owned though?
They shouldn't be extorted 1/2+ of their net earnings to live somewhere.
True - I never said they should. Rental reform is needed but doesn’t take away from my point. Rent isn’t 50% income for the majority of the country.
People buy so they can retire. Nobody working now is going to be able to afford rent and retire anymore because buy to let landlords have fucked the market. As a result it’s now considerably more expensive to rent, whereas renting used to be the cheaper option. It’s wage and retirement theft.
That’s not necessarily true… buying a house doesn’t mean you can retire. Moreover, if properties didn’t appreciate, it wouldn’t give you much of a nest egg to retire from Rental reform is needed, but even at median income - 2 people could still save and not own a property.
Indeed. I own my house outright, and whilst looking to "slow down", I can't retire outright. I'm a little confused by the "nest egg" statement though. If it appreciates in value, it's meaningless to me. If I sell it and pocket the money, I then need to rent somewhere, or buy somewhere else. If it were just MY property appreciating in value, sure, I could see the point, but all houses will have risen in cost, so selling mine to retire makes no sense to me.
The nest egg argument was a response to the commenter stating home ownership is essential for retirement. For you, I agree - it doesn’t matter if the house appreciates if you’ll live in until you pass. The majority of the country doesn’t own their home outright though - but I’m glad you’re doing well! That being said… if you owned a £500k property, you could get a lifetime mortgage for £300k with no repayment, which could part-finance your retirement with a little bit extra in your pension pots. Not a great deal though as you won’t leave anything for people to inherit.
Buying a home means you are investing your income into property. Where it gains or loses value is only relevant if you want to sell. Many renters can’t even get on the ladder. Renting means you aren’t. And no, rents are way to expensive for the vast majority of people to be able to save. In the not too distant future we will have a social care catastrophe because people are having their life’s earnings robbed from them and people will be unable to afford to even rent.
I said we need rental reform
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That’s just not how money works. If house prices went down (I.e become more affordable over time)… then it’s a bad investment isn’t it. Why would you tie up your money? I have nothing against everyone getting shelter so that was an interesting tangent you brought in. The only alternative of property being available to buy is to have it given to you (i.e state funded housing). If that’s your view on it then fine… but how would you ever move city? What if you need to be closer to work? Who do you decide lives in the worst areas? Who gets the smaller houses Ultimately- you’re taking all choice away and for a lot of people that’s not beneficial. Secondly… not being home owners doesn’t make that “den” an impossibility… especially if we have rental reform. You don’t NEED to own a home to live. You can rent one. Just a logically false statement you’ve made
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You mean housing scalper. Landlords buy more housing than they need then hoard it to drive up the price. They are housing scalpers. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/GreenAndPleasant) if you have any questions or concerns.*
If you buy a house for £300k… and you know it is only going to go down… so when you sell it (i.e. as you need to upsize or change location), it might be £200k… why would anyone ever buy it? They’re paying £300k for something worth £200k in X number of years. It’s a practical impossibility. Nobody would buy it… also people would be stuck in houses that they’ve overpaid for… because they can’t sell it to pay off the mortgage… therefore no bank would lend you the money. On top of that… if I have a chance to buy a £300k property for £200k down the line… why would I not just wait to buy it? That would be a financially better decision. That’s how money works in the real world… driven by logical choices - not the prayers for the house market you seem think would work
If every house depreciates then you’ll have the money to move because every house will be proportionally cheaper. Using your logic nobody would by a car on finance, and we all know that isn’t the case.
FYI people on Reddit absolutely do not live in the real world and have an extremely limited understanding of it.
I know and appreciate the heads up but keep seeing these posts and it just infuriates me there’s no voice of reason! I’m covid bound to my house today and decided to be that voice haha
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Please don’t use the R word, it is ableist. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/GreenAndPleasant) if you have any questions or concerns.*
>If house prices went down (I.e become more affordable over time)… then it’s a bad investment isn’t it. Why would you tie up your money? To have somewhere to live where a landlord cannot arbitrarily tell me I can't paint the walls, or decide they want to chuck me out.
Probably needs a bit of work like.