Post Race!

[homer13j]

One of my boys just played volley ball with Ward Hines on a beach in Mexico - played on his team!

You got the name close, but not quite right... LOL

[NeedSomeAnswers]

What I don't understand is how people can justify not owning a home even after the market crash. I purchased my first home when I was 19 years old for $40,000. I had to come up with roughly $5,000 which at the time I was making tip hourly($2.15) and making roughly $400 a work week as well as about the same on the weekends from tips, it took me about 3 and 1/2 months to save up the amount that I needed while still paying for me and (at the time girlfriend, now she's mah wife!) to live.

Depends where they live i expect. Where i live $40,000 would maybe buy you a shed!!

Also it probably depends on whether you can live at home and build a deposit or whether you parents kicks you out when you 16.

Seriously the average house price in the UK is £197,000 which is $280,371 (thanks google currency converter). Near me to get your first house your probably talking about £130,000 - £140,000 ($184,977 - $199182), and lots of people just cant afford that.

I expect that in the bigger cities in the US property is probably similarly expensive.

[szlamany]

You got the name close, but not quite right... LOL

The old "two first name trick" - got me!

[SJWhiteley]

Depends where they live i expect. Where i live $40,000 would maybe buy you a shed!!

Also it probably depends on whether you can live at home and build a deposit or whether you parents kicks you out when you 16.

Seriously the average house price in the UK is £197,000 which is $280,371 (thanks google currency converter). Near me to get your first house your probably talking about £130,000 - £140,000 ($184,977 - $199182), and lots of people just cant afford that.

I expect that in the bigger cities in the US property is probably similarly expensive.

While this is true, it's not a static situation: if you change one variable, the others have to change. What would happen if you had to put down, lets say, 20% of the value of the house to get a mortgage? so, a $200k house requires $40k. That's a big chunk of change to put in a bank account (having said that, $10k a year for 4 years isn't as bad as people think it may be). Depends on what you want from life.

However, if people aren't able to afford a $40k deposit, people won't be buying $200k houses. If people have $10 to $15k to put down, then house prices will change to match what people can 'afford'.

Same situation with cars. If you can lease a car, or get a 7 year loan, it means the price of cars can go up, to match what people can afford.

This is the real problem with so-called wage disparity: it isn't the difference between wages but that those on the low end struggle to meet their monthly financial obligations due to excessive spending habits, and the credit they can't afford to pay back.

[dday9]

The old "two first name trick" - got me!

I must not know the Steelers too well because I knew who you were talking about and didn't think twice about the name

[FunkyDexter]

While this is true, it's not a static situation: if you change one variable, the others have to change. What would happen if you had to put down, lets say, 20% of the value of the house to get a mortgage? so, a $200k house requires $40k. That's a big chunk of change to put in a bank account (having said that, $10k a year for 4 years isn't as bad as people think it may be). Depends on what you want from life.

However, if people aren't able to afford a $40k deposit, people won't be buying $200k houses. If people have $10 to $15k to put down, then house prices will change to match what people can 'afford'.

While I agree with some of that it misses the single biggest factor affecting house prices in the UK: shortage. A substantial proportion of people can't afford a 40k deposit and, yes, that that does reduce demand. However, our supply is so low that the diminished demand does effect a downward pressure on prices because there's still lots (and I mean LOTS) of demand that remains unfulfilled.

Personally I agree with sentiment behind DDay's original post but I also agree with NSA that it doesn't address the reality of life as a first time buyer in the UK at the moment. I know very few people who would argue that owning a house isn't a worthwhile investment but I also know alot of people for whom it simply isn't an option.

Worse, there isn't enough supply to fulfil the rented sector either. The crisis in the buyers sector has become so acute that the government has started introducing some pretty draconian taxes to discourage the buy to let market in the hope that this will free up some properties to be bought by owner-occupiers. This will have some effect but I can see an undesired side effect coming down the line: rents are going to sky-rocket.

Those landlords who are reasonably cash rich will hold onto their properties and will reap even greater rewards long term. A few properties will be freed up by the less well off landlords who will be forced to sell and that will benefit those in the middle of the income bracket who will consequently be able to buy. But the people who will pay for this will be the folks right at the bottom for whom the option to buy will remain out of reach and who will have no option but to pay ever inflating rents.

Meanwhile we're cheerfully selling off our public housing stock (which I support) but failing to replace it (which I don't). Meaning that, at the same time as we increase the pressure on our renters from above, we're also systematically removing the best safety valve that might relieve that pressure from below.

But I own a rental property and I can afford to hang onto it... so screw 'em.

[dday9]

but I also know alot of people for whom it simply isn't an option.

I do not agree with this. To me, owning a home should be a number 1 priority; above all else you should own a home. So you should do everything possible to own a home. If I were starting over with nothing and lived in the UK then I would rent for 6 months which would be long enough for me to purchase a camper. I would then live in the camper for however long it took me to save for a down payment on a home, which assuming that I'd be making €18,000 a year then it would take me roughly 2 to 3 years to save up €22,000 for a €110,000 home. I'm sure that just like my first home, it would not be in the best neighborhood, but I would be building equity in a solid asset along with having the potential to use the home as collateral on a better home a few years later.

I think that the real problem lies in what SJWhiteley pointed out here:

This is the real problem with so-called wage disparity: it isn't the difference between wages but that those on the low end struggle to meet their monthly financial obligations due to excessive spending habits, and the credit they can't afford to pay back.

Lower income families want to spoil themselves or their family for doing well for a short period of time living minimally which translates into them taking out a 5 year loan to purchase a new vehicle with 18% interest or they'll do the rent-to-own furniture where they wind up paying almost double for the furniture. Don't get me wrong, it's not bad to spoil yourself, but you need to prioritize your spending and purchasing a home should be priority numero uno!

[FunkyDexter]

You're going to need somewhere to put that camper van. We removed the right to roam some 20 or so years ago so it's not going to be a common area. Wherever you choose, if you leave it there too long it's going to start being questioned as a permanent structure and the local planning officer is going to come knocking, even if it's private land. Realistically, the only place you're going to be able to put it for that length of time is on a tourist caravan park (a domestic park won't have you - they'll want to sell you one of their own caravans) which is going to cost you just as much as renting a flat because it's aimed at tourists.

The UK is not the US. Our cost of living is much higher than yours (probably double I suspect, although it depends which bit of the UK you compare to which bit of the US) and land here is at a premium. I hate it when I hear people say "we're a crowded island" (mainly because it's usually bookended with some form of intolerance to anyone who wasn't born here) but, where housing is concerned, it's true. We have a shortage and no easy way to increase supply. That means that no matter what you do, someone somewhere is not going to own a home.

Seriously, take a look at this. Live in a single flat share in London and your rent and groceries alone are going to cost you over £7 grand a year. That's before you've paid for any kind of transport, a phone, broadband, utilities, council tax... You're outgoing before any kind of luxury at all is going to be £10K plus, probably closer to £12K.

Our living wage is £7.20 an hour. Assuming a 40 hour week, 50 weeks a year that's an annual income of £14,400. even assuming outgoings of £10K it's going to take you 10 years to save up a deposit of £40K which is what it will take to buy a property in the south.

Edit> as a side note, here's what that £110K would buy you in London. It's a Garage. That's stirling, though. In Euros you'd get a lot less.

[Shaggy Hiker]

You got the name close, but not quite right... LOL

As a resident of the Cleveland area, I assume you have that picture on a dartboard.

[Shaggy Hiker]

I must not know the Steelers too well because I knew who you were talking about and didn't think twice about the name

I'm one step better: I knew there was something wrong with the name, but didn't know what it was.

[szlamany]

I must be dyslexic when it comes to this name - if I walk away from the screen I still don't know which way is right!

[Gruff]

Hard Wine?

[szlamany]

Hard Wine?

Age?

Too much of the 60's made it into the 70's maybe?

I only drink all that chianti as a sleeping aide!

[Shaggy Hiker]

I don't feel like I agree with DDay, but in fact I rather do, though only if you have some expectation of stability. When I was expecting to travel every couple years, building up equity didn't much matter to me as much as the ability to pack and go without effort. After all, for the first five years out of grad school, I was kind of expecting to be living out of a backpack for about a third of each year. There's no paying a mortgage when your income is $0/month, so renting makes sense. I didn't change my mindset until I moved to Idaho, and even then it took some time.

The US is certainly different in that you can get a lot in a trailer park for not too much, which gives you electricity, water, and sewer hookups. Financially, it may well make lots of sense, but not always. That certainly limits the quality of your residence, and you are doing that for a simple financial reason: It appears likely to you that in the time you are living there you will be able to save enough money to then move to somewhere better, or save enough money for something else.

The problem is that we have no idea what the future brings. There is no investment that you are guaranteed to realize. We haven't had insane inflation in the US...perhaps ever, but plenty of other countries have experience that. If we did, then saving for the future is useless. I do think that saving for a house in the US makes good financial sense, especially at this time, but at other times it might not. I certainly don't regret not trying to buy something in the Florida Keys (totally out of reach and forget about trailers, that wouldn't be happening), and I don't regret not living in a trailer park for the few years before I moved to my current location. It's all just a series of choices about how you want to live, and it all ends up the same.

[szlamany]

Hard Wine?

Wouldn't it be Hard Wines anyway?

[dday9]

(totally out of reach and forget about trailers, that wouldn't be happening)

Could you imagine the insurance on a mobile home in the Keys?! That would be outrageous!

I have a customer who lives in Cameron which is literally up against the coast and he has a single wide. Anytime a hurricane comes he hooks his single wide up to his Ford F350 and hauls it up state for a few days.

[Gruff]

Yeah.
Also hindwards is a bit backwards.

[szlamany]

Shined raw?

[Gruff]

Could you imagine the insurance on a mobile home in the Keys?! That would be outrageous!

If I moved to Florida I would consider building a two story out of concrete and rebar.
Possibly with flying buttresses.

The bottom floor being all garage.

[szlamany]

War shined?

[szlamany]

Washer din?

[szlamany]

A wish nerd?

[Shaggy Hiker]

If I moved to Florida I would consider building a two story out of concrete and rebar.
Possibly with flying buttresses.

The bottom floor being all garage.

That is a pretty common building design down there, at least in the low-lying areas prone to storm surge. Well built houses did fairly well, but the damage they often suffer is from airborne debris from the other houses.

I moved to the Keys right after hurricane Andrew. I got the job just before the storm, and it took a week to get through on the phone to find out whether or not there still was a job. The Keys were missed by that storm, so off I went. Therefore, I was in the area as all the revelations were coming out after the storm. Lots of building inspectors were not doing their jobs. There were houses where the roof wasn't actually attached to the walls, but was just resting on them. There were trailers in trailer parks that had 'hurricane straps' that were basically just strips of metal with spikes driven into the ground. Not very long spikes, either.

I don't believe there are any trailer parks in the Keys. The land down there is insanely expensive and exceedingly rare. After all, those islands are often barely a mile wide.

[homer13j]

As a resident of the Cleveland area, I assume you have that picture on a dartboard.

No, this:

[Gruff]

those islands are often barely a mile wide.

If you build your own Island possibly less.

[Shaggy Hiker]

No, this:

I went to college at Allegheny, just across the border. Over half the students were from Pittsburgh, with most of the rest being from Cleveland. That was the 80s, though. The Clowns were slightly better than the Squealers, at the time, but both teams sucked. The games were entertaining, because the audience couldn't decide which team to boo more, their own or the opponents.

[SJWhiteley]

While I agree with some of that it misses the single biggest factor affecting house prices in the UK: shortage. ...

That's true; In the US we have a considerable amount of space to expand outwards. When I left the UK there was an ever growing push to prevent development into greenspaces, and a growing 'gentrification' of run-down areas.

[FunkyDexter]

When I left the UK there was an ever growing push to prevent development into greenspaces, and a growing 'gentrification' of run-down areas.

Yeah, that's still the case. My hunch is that we're going to relax the "Green Spaces" restrictions before too much longer. We've been busy back filling our cities but it doesn't feel like there's much stretch left there - it's not so much space that's the problem (you can always build up), it's the transport systems around cities that can't cope. We either need to radically improve urban transport or spread the workload by encouraging people out of cities. The second option's cheaper.

As for Gentrification, everywhere in a major city seems to be gentrified now and prices are rapidly disappearing out of the reach of anyone employed on low wages. There's a coming crisis in London because the likes of Nurses, Teachers, Cleaners etc. can no longer afford to live near their work and the transport systems are incapable of moving them in and out of the 'burbs during rush hour. The effect is going to be that hospitals, schools etc. will not be able to find staff.

Heck, even Manchester's posh these days! I heard about a guy who parked his car there and when he came back it still had wheels

[NeedSomeAnswers]

Yeah, that's still the case. My hunch is that we're going to relax the "Green Spaces" restrictions before too much longer. We've been busy back filling our cities but it doesn't feel like there's much stretch left there - it's not so much space that's the problem (you can always build up)

I don't see that happening any time soon, even though it may be the most sensible option. There are a lot of Tory votes in the country side and they are dead against building on the green belt.

Heck, even Manchester's posh these days! I heard about a guy who parked his car there and when he came back it still had wheels

Hey stop making wild allegations, i am sure if he came and parked here again those wheels would be gone quick-smart !

[Shaggy Hiker]

A similar situation seems to be overtaking New York. The prices are getting insane. The places that used to be refuges for the low-paid are being gobbled up for the cost. At least you can still commute, in theory.

My sister lives out on an island that was always kind of expensive and is getting REALLY expensive. Since it's an island, they have to have a certain amount of services for it to be a viable community, but that means that there has to be sufficient pay to allow the service sector to live on the island...after a fashion, anyways. I did find a couple guys living in a lean-to on the backside of a state park on the island. So, as the prices soar, the ability of businesses to hire diminishes and costs rise. A few years back, I bought a gallon of milk for $8 at the market on the island. For comparison, I pay about $1.80/gal in Idaho.

[dday9]

I want all of y'all to check out my latest contribution

http://www.vbforums.com/showthread.p...r&goto=newpost

[Shaggy Hiker]

Post race is getting awfully serious. I may have to take a walk.

[dday9]

Take a hike!

[szlamany]

Maybe on another day!

[dday9]

The weather is bad here.

[Shaggy Hiker]

It's slightly damp, here, too...though I wouldn't say rainy, even for this area, and some of you can get more in one day than we get in a year (about 7 inches, on average).

[homer13j]

Spring finally arrived here. A week after we had to cancel our annual spring practice day at Grattan Raceway. Can't drive go-karts in the snow. Well, you can... but it's not advisable. Unless you live in Russia...

[dday9]

If Rocky taught me anything it is that in Russia they take roids to work out.

[dday9]

In my opinion, this was the best piece of propaganda during the Cold War.

[Shaggy Hiker]

My father an I used to watch ice racing back in New Hampshire. It wasn't go-carts, though, but cars.