>be American
>have british gf
>her sister and sister's husband recently bought a home
>their combined income is around 50k pounds per anum
>they got approved for a loan on a 555k pound property
>now my gf wants to buy an equally ridiculously-priced home
>spend all day trying to convince her that this whole system is ripe for collapse
How is the UK property market so fucked that something like this could happen? Why would anyone think this is a good idea or that this is sustainable?
You've posted this bizarre fantasy about 30 times now
>a wife, home and eventual family is a bizarre fantasy
The absolute state of the UK, lads and germs
It is for Sup Forums users
all property investment eventually pays off. you are not buying a house at the worst time in all of history.
Hardly, I've posted it about 3 times now and it isn't a fantasy at all. The house itself is smaller, less well-appointed, and in a worse location than the home I bought in the states for about 80k pounds. The price/income ratios at which brits are buying property (frequently 10x+) are absolutely insane.
>all property investment eventually pays off
girlslaughing.jpg
Prove me wrong. unless you're buying something absurdly rural,everything has a trend of becoming more expensive, pretty much universally. sure, on a scale of a decade you can take a loss, but in the long term you'll always make a profit. And who thinks in decades when immortality is around the corner?
>>their combined income is around 50k pounds per anum
do they work at mcdonalds? never get how people can make so little money, almost everyone in my friends circle makes 80k+ most 100k+
t. Ezekiel Shekelstien
Head of Mortgage Servicing
She is a teacher and he is a nurse. Incomes are much lower in the UK. In the US, a nurse alone would make (significantly) more than both of them combined.
Housing is generally a pretty poor investment unless you are buying rental property.
Only in the short term. And sure, there are ultimately better long term investments too, but it still turns a profit if you can wait 50 or 100 years.
I have bought some land and I'm gonna score big when global warming makes it the new coastline of USA.
>Only in the short term.
No, in all terms. There are much better, more liquid, and higher-returning investments out there. Housing has a huge opportunity cost. You'll also likely never have access to the money, as you'll be living in the house or take the funds generated from sale and purchase another.
show me one city where the average housing price has decreased from 50 years ago.
You can't just use that number in a vacuum. You have to compare it to the return on other assets, the specific pitfalls of housing investment, adjust for inflation, etc.
Owning a home is unironically a bizarre fantasy for every that wasn't born with a silver spoon
even adjusting for inflation. the other variables do not matter, I never said it's a superior investment, just that eventually it pays off in 99% of cases.
No you've definitely posted it more than 3 times and you've made different shit up each time, if I could really be bothered to crawl through the archives I would (lucky for you I can't)
>all property investment eventually pays off. you are not buying a house at the worst time in all of history.
Unless you buy at a high point and the market tanks when you're forced to sell (say a new job hoursaway).
Fair enough, this is obviously assuming that you're not so poor that you ever HAVE to do something. but then you shouldn't be buying a house in the first place
This. I've seen this thread far too many times.
my gf was talking about $3m homes the other day like they were reasonable goals after we finish studying...
I haven't at all. The details are exactly the same because they are what happened. She makes just over 30k a year. He makes just over 20. The house they bought was 555k, down from 595k. It is a tiny, semi-detached two story.
>I never said it's a superior investment, just that eventually it pays off in 99% of cases.
In other words, it is a shitty investment.
I just said it pays off. it can still be a shitty investment.
Explain her that human can eat only one bowl of rice a day and still survive you low life proletarian scum
It doesnt though, because you live in that house. You can't access or use the money.
Hahaha OP is a fucking faggot making up fantasies online. Neck yourself bud.
I wish it was made up. It isn't.
bump
Dire
>"""""""""great"""""""""" britain
>all property investment eventually pays off
There we quite big problems in denmark some years ago when the prices dipped and your interest only mortgages got underwater. Is the situation better already, I haven’t folowed it for some years, after sampo dumped junk loans to danske bank.
This.
>their combined income is around 50k pounds per anum
>they got approved for a loan on a 555k pound property
I don’t know how it works in the uk, but are they paying back the loan or paying only the interest?
Seems okay depending on the location. Do you all live in suburbia or something? That price isn't atypical in urban desirable cities.
they have a 25 year adjustable rate mortgage, which will balloon and absolutely bankrupt them if interest rates rise.
>are
I live closer to a major city and in a much more desirable location than they do. My house cost the equivalent of 80k pounds, is much larger, and has a larger plot.
You live close to a major city but not in a major city? That is why it's cheap, you have no competition for space where you live.
>if interest rates rise.
it is already rising in the uk and brexit will cause it to rise even more
No, I actually live IN a major city.
Then you live in a major city that has undesirable parts that drive down its property value.
The premise is simple. A property's value is directly related to the amount of people who want to own it. property value is low? Nobody with the money wants to live there.
my area
>right next to multiple forms of public transport
>shopping, restaurants, and parks all minutes walk away
>perfectly safe
>clean and white
Her area
>nowhere near anything decent
>school parking lot literally 3 meters from her house with major road in front
>tiny yard and tiny house that looks really worn and outdated
>trash strewn everywhere outside
>cant walk outside at night due to crime
>tons of brown immigrants
That's your opinion and its not wrong or right. But the fact of the matter is that those with money prefer to live in her area then yours.
Nice fantasy
Not it isn’t property is one of the worst things to invest in
Prices are high across the country as a whole. It isn't that the area is more desirable, it is that the whole market is flooded with cheap credit, limited space, unintended consequences of poor legislation, not enough building, etc.
rental property isn't, but the house you live in is a terrible investment. That money is likely locked away forever and you will never be able to invest it or enjoy the "returns". Many other investments generate returns at a much higher rate as well with a lower expense ratio and better liquidity.
>cheap credit
“No”
Interest rates have been low true but that is due to the fact that we very rarely default on our loans thus it is not such a large risk
The reason loans are given out by banks to by property is part of a government scheme that started in 1980(?) that incentives banks to hand out loans for property even if they make very little money comparatively to other investments
Read irrational exuberance if you want a good idea of why property is retarded to invest in I’m too lazy to Go over it but rental property is still victim to fluxes that can’t be secured there is a formula for it that I completely forgot
mate, I can't keep repeating the same thing. Limited supply and low density buildings are the reason for high prices because they limit supply and the potential for redevelopment grows. By virtue of land constraints, supply, and desirability leads to property value. Either there are enough people wealthy enough to keep buying into that area or there isn't and the price falls.
The fact that one area has high property value reflects the supply constraint and the number of people who want to live there. If not for people with the wealth to afford that area, then the prices should naturally fall.
In your circumstance, as great of the amenities are near you, there is not enough demand to justify high prices or there is simply far more supply then demand.
Credit is cheap everywhere so it's a moot point when comparing the two, all things being equal.
Popular places are expensive and the price reflects that.
>getting your business advice from pop-econ books
lmao, literally kys yourself Nigel
go to globalpropertyguide if you need to know what market to go in, yields can go up to 12%
>the only mainstream economist to predict the financial crisis
>pop-econ
It’s okay Manuel I’m sure you are having fun with your bitcoins!
Nouriel Roubini is the one credited with predicting the crisis, you mong.
No wonder you're poor, Jesus Christ.
>Popular places are expensive and the price reflects that.
You don't seem to understand captive markets.
I don't know what to say mate. Your place is simply not as popular to live in then other places. The market has spoken objectively and definitively. Your person opinions on whichever is better is a minority.
Popular places command higher prices, whether or not it is a captive market or not is moot. Wealthy people want to live in a particular location and will pay top dollar for it.
Lets say I have a barrel of pure, clean water. I try to sell it to people living in a town with modern plumbing and it is worth next to nothing.
Another man has a dirty slop bucket full of tainted water but manages to sell it to dehydrated desert travelers for a tidy sum.
The barrel of clean water was objectively more desirable, but the travelers were a captive market. The supply in the local economy was extremely limited, as was choice, thus they paid more for an inferior product.
yeah i'm calling bullshit where is this house of hers exaclty?
Harlow, an absolute shithole
and every market is held captive by their natural, geography, and artificial, bureaucracy, forces. i'm saying it's a moot point because the market price reflects the demand and thus the price. it doesn't matter if you think one location has more 'value' then the other. the price is determined by the sum total of the demand.
using your own example. the dehydrated desert travelers are obviously wealthy enough and need to pay whatever the market commands. it doesn't matter if it is a 'inferior' product. the market has dictated the price and the people have responded. there must be some underlying desire to live near this desert to command such a high price or else nobody would subject themselves to such conditions and nobody would have enough money to perpetuate said system.
>market price reflects the demand
Demand being equal, if supply is restricted, price will rise.
So no.
Were will you live otherwise?
but the demand isn't equal, I've never asserted that.
In a place with a lower house price/wage ratio
I understand wanting to buy a house. Been living in my apartment for 2 years and coming up on a 3rd. In the end I will have paid $36,000 USD over the years in order to live here. I could have put that toward a house and have a lower monthly payment. Housing prices are way too high right now though, I can't even imagine how people survive in places like London, SF, or Vancouver though.
sure you can, it's called a HELOC
The notion that any person can "buy" part of the Earth fascinates me
>London, SF, or Vancouver
Chink, poo, and camel fucker businessmen putting money into (((FDI)))
Owning your own home is a fantasy. You of all people should know this, unless you're a fuckwit on a proxy. The only people who can afford to buy houses in Australia are old rich cunts who fucked the economy up for the rest of us, rich foreign investors or the offspring of said old rich cunts.
Australia is fucking bleak compared to the UK if we are talking about the housing market.
>mfw you pay less rent p/w than where I live, and this place doesn't even have hot running water or access to a landline. The housing/job market here is fucking retarded.
>why are houses smaller in one of the most densely populated countries in the world compared to one of the most sparsely populated countries in the world?
Really makes one ponder
Americans don't live in cities they live in giant sprawled out suburbs 50 away from the their local city.
Real estate is the ultimate meme
Smart money buys stocks, hypersmart money trades options
forgot pic
They fell for the real estate meme, they will regret their decision once property taxes, utilities, maintenance, realtor fees, ect kick in
not in Canada. houses are tax free profit.
Capital gains tax is like 50% of your tax rate so only 25% if you're in the top bracket, meanwhile house cucks are stuck paying property taxes, utilities, maintenance, realtor fees, ect. Investors also get dividend tax benefits and shieet, there's also tax free savings accounts
I live in a city.
you have to be a retard to buy a house when you're young
you have to live somewhere, utilities, property taxes and maintenance fee's are moot. realtor fee's is the same as trading fee's and MER. tax free savings account has a maximum contribution.
obviously unless we're working with exact numbers it can go either way. but in my experience, in Vancouver, I've 150% my equity in 2 years tax free.
it's all a matter of timing for either. neither is inherently better then the other. each is reliant on circumstances.
okay
>Vancouver, I've 150% my equity in 2 years tax free
A mere anomaly
>it's all a matter of timing for either. neither is inherently better then the other. each is reliant on circumstances
Objectively wrong, data going back to 1790 proves the superiority of stocks, rapidly increasing housing prices weren't even a thing before the mid 90's, a house is a liability and can barely even be considered an investment. If you include reinvested dividends the stocks in my picture would be 10x higher
>I've 150% my equity in 2 years tax free
Which you will never have access to because it will be locked in your house, or in case of a sale, spend on an equally inflated home.
>reinvested dividends
Pic related the power of dividend, meanwhile rural and suburban retards keep screeching about stock market crashes which only present an excellent buying opportunity
what point are you trying to make fucking hell it's like trying to reason with a brick
just leave it Leafbro
In just a few decades, parts of the UK have seen the price of the average house go from three-times the average salary to eleven-times as much.
what's the smart play here?
rental?
should I convince my mum to sell her house (ridiculously inflated price, mortgage is a fraction of overall value) and rent in a cheaper area?
yes, the dividends from investment on investment of that money can pay for rent. in korea you can have no rent and not buy a house if you give someone about 200k$, they let you live there 2 years and give your money back, because they reinvest it, called jeonse.
quads confirm
h1
You will get petrified and staggered as fuck if you take a peek at how expensive it is to buy a house either in Tokyo or Seoul. England? Ha, it's just as well that they take it for granted that they have to spend more than 10 times of their income to get their own house.
Your first house doesn't have to be a million dollarydoos my man. Go smaller or farther out or leave Shitney and you can easily find something for 300-400k. You could buy a mansion for that price in a non capital city. Given you get paid at least minimum wage and don't blow all your money on booze drugs or useless shit there's no reason you couldn't save a deposit within 2 years.
>Go smaller or farther out or leave Shitney and you can easily find something for 300-400k.
Toppest kek. You can get something like that here for like 100k.
bump
what is a heloc?
hell at 150% + my equity i could just retire.
data going back 1790? i'm not even going to question the objectivity and reliability of data going that far back. like i said, pick a specific scenario to make your point, the argument of whichever is better breaks down into what we are comparing. if you are making the broad generalization that houses in canada return less then stocks, no disagreement from me. but depending on LOCATION and time, it can vary greatly.
Contrary to popular belief, owning a house is a huge liability, unless you're buying it to rent it right off the bat, and even then it comes with huge maintenance costs. You're way better off putting your money into an index fund or even buying memecoins for the long term
Still better than your fucked healthcare system.
Both healthcare systems are pretty fucked. I used to live in the UK and worked for the NHS. It is pretty shit, just shit in different ways.
bump
Can confirm. NHS is a shit.
Problem is, no one wants to live in the fucking outback, jobs are not there.
And 300-400k is a ridiculous price, unless you really mean a mansion.
I'll never buy my own house, I reckon, rathet put my money in stocks.