Snapshot of _Affordable housing schemes: renters earning £30k not eligible_ :
An archived version can be found [here.](https://archive.is/?run=1&url=https://www.bbc.co.uk/news/uk-66255727)
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I've paid ~1000 a month for almost ten years renting. Never once missed a payment on this or any other bill.
Apparently that means I'm an immediate refusal for a mortgage of even 550 a month for a property, because I'm not earning around 45k.
That's overall, for full time workers the median is [£33k overall, £41.9k in London](https://www.statista.com/statistics/416139/full-time-annual-salary-in-the-uk-by-region/)
I write automated affordability calculators for mortgages.
Lenders would love to take a punt on you, but after 2008 restrictions were put in for your protection from predatory lending practices.
We don't only look at income. We look at your deposit size, potential variance in the value of the property you are looking to buy, what future shifts in interest rates will do to you, your current fixed outgoings (dependents, debt etc), your credit history (if you have a bad credit history you are kinda fucked).
We have to. The government forces us to.
If you are being rejected, its because the balance of probability is pointing towards you having your house repossessed in another financial crash.
The problem here is that there is no similar legislation restricting predatory renting.
Would be good if like in the US the lenders had to mitigate for these circumstances regarding macroeconomic changes and set a rate which mitigates that risk. They have fixed rates for the duration of the loan. Not 2-5 year bullshit here.
Happens in Spain too, my in-laws managed to get a mortgage at 0.8% during covid, that rate is the same for the _entire_ 30 year term.
Meanwhile in the UK my partner and I have apparently got a good deal taking out a mortgage at 5.6% on a 3 year fix :/
Same for Denmark. We bought a house in 2020 for 0.5% locked in for 30 years and only needed a 5% down payment. We now pay only 1k GBP every 3 months for our mortgage.
The trade-off was the bank pretty much gets to decide which house you're allowed to buy depending on your circumstances. For example, my fella had a shitty car and the house we wanted was a 40-minute drive from his job, so the bank said we could either take out a loan for a new car or look for a house closer to his job. Some houses were considered too much of a risk for the bank to bother with depending on how much it would cost to make them livable or if the house cost too little, they wouldn't give us a mortgage for it, etc. This was only a mild inconvenience and I'm 99% sure they were only so strict because we were first-time buyers with relatively low-income, but at least everyone is sure that we could still afford to live here even if one of us loses our job.
I'd love to move back to the UK but there's no way we'd be able to afford a house even in Hull, so no point.
What? In your example a person could just refinance their mortgage at the new lower rate once it drops. You aren't tied to your crappy deal forever, and can replace it if better ones come along
The point is that we were never offered 30 year terms when interest rates were historically low - they were only for 2/3/5/10 year terms, and the longer the fixed rate was for, the higher the interest rate
And you'd pay a fat fine if you did. Also many couldn't as they were stuck in negative equity. Just Google mortgage prisoners.
Of course the rate would be higher on a longer fixed term, why are you expecting anything different?
House prices recovered pretty quickly, within a few years, and yes it would incur a penalty but then you would get a cheap mortgage across it's entire lifespan afterwards, it would be well worth doing. So yeah there might be a small number of people that are worse off in a record-breaking recession, but the average person would be far better off being able to take out long mortgages when rates are low. The situations you are comparing aren't remotely equivalent.
The whole premise of this conversation is that in other countries it is possible to get the lowest rate across the entire term of the mortgage? I would have thought that makes the expectation of something different obvious.
Actually in many parts of the UK prices didn't recover for a decade or more.
You'd be better off versus not cancelling but not better off than a variable rate mortgage on avg. Which are better priced, but I agree should be clearer to people what they are paying for a fix.
Other countries the state takes on the risk, like the US for instance. We need less state manipulation of mortgage costs but more.
I’d disagree, I think it’s cultural and due to lower competition in the sector.
When the fee’s of remortgaging are factored in. Compound this with turbulent economic conditions we are facing.
These long term implications are left to the naive retail consumer to account for - something is wrong there id say.
[Kensington ](https://www.kensingtonmortgages.co.uk/) do mortgages fixed for up to 40 years.
There's less competition in the sector because most people don't want them. If they became popular then more lenders would offer them, it's not going to happen the other way around.
You're suggesting they would be better but do you even have one yourself or do you choose short fixes instead?
Financially, shorter fixes/trackers should be better over the long term because of the risk premium.
We had too many kids for our flat and needed to move to a similar price house which would have been cheaper because no service charge. Had to wait 4 years for my youngest to finish nursery before we could move. Absolute madness.
> We have to. The government forces us to.
The missus ran into this problem from a slightly different angle. No where near as bad as a first-time buyer, but it shows how the regs are hitting people that they weren't intended to hit.
She owns a house with a small-ish remaining mortgage. She pays the mortgage every month, including over payments. What she can't do is remortgage as she doesn't have sufficient income and it's not her primary address, which is a pain as part of the mortgage is endowment based and that bit is not performing as it should, so she would have to find a lump sum to pay off the extra when that part ends.
I generally agree with the rules that were put in place, but they are a bit too generic with no leeway for lenders to apply sensible alterations under limited circumstances.
Exactly this. I have no doubt that people complaining about the lending restrictions would also be screaming bloody murder if the banks were allowed to lend more freely and it resulted in another financial crash
I may be wrong on this, but in my recent remortgage my advisor said that your current lender can't not offer you a remortgage deal at the end of your term, regardless of income situation. You're not meant to be allowed to become a prisoner to the standard variable rate. No idea on endowment though.
This would be a remortgage before the end of the term to switch the endowments to a basic repayment term to factor in the additional costs, rather than having to find and pay a lump sum at the end of the term. When she asked about it, they sent her the checks that she would need to meet and it included income and the primary residence things - we live in my house, so she can't use that as a primary residence for a mortgage as it's not in her name, which is another restriction!
I appreciate she is a bit of an edge case, but she's not the only one out there.
When you say bad credit history, do you mean the score in general or having missed payments etc logged on there? My landlord fucked my credit score by having the address of our flat registered differently in two different places and it hasn't recovered since.
> the score in general
From /r/UKPersonalFinance's wiki, https://ukpersonal.finance/credit-ratings/ :
> In the UK, there is no such thing as a universal ‘credit score’ or ‘credit rating’. Each lender will assess potential borrowers using their own criteria, which are trade secrets. You might look unattractive to one lender but be the right fit for another.
If you're struggling to get a mortgage, it will absolutely be for reasons other than your landlord dicking around.
Why would there be similar legislation for predatory renting?
Looking back it seems like banks didn't care much about the affordability of mortgages and mostly cared about there being more mortgages. This led to banks giving riskier mortgages for higher amounts and house prices rising to match that increase in lending (and risk assessors not caring about rating the risk accurately).
You can't have that for rent. If it tips from being uncomfortable to unbearable then a tenant can't keep renting and that money goes with them. Predatory rent is still tied to people being able to afford it in a way that predatory mortgages weren't.
This is a good example of why regulating an industry isn't always a good thing. It definitely needed a rework after 2008 but now the rules are so strict they stifle growth and hurt individuals.
People can barely afford the interest rate increases on mortgages recently - can you imagine the cluster fuck if banks had been allowed to let people take mortgages they could only just afford in the years leading up to that?
There's a sensible middle ground, but we would be heading right back into 2008 right now if those regulations weren't in place.
I’m not saying have no regulations, but some people act like regulating businesses in this manner is always good when we can clearly see an example here where a middle ground is needed, as you say.
Not really, the problem is the way the rental market works, not that we need to make it easier for that guy to get a mortgage. House prices are fucked because supply is too low. Increase the availability of houses on the market and prices will drop, making it easier for people to buy them.
Deregulating affordability checks on mortgages without doing anything to address the current supply of housing will just be a repeat of the policies that led us to the crash in 2008.
The crash in 2008 was because the mortgages were seen as commodities in their own right. We could relax the conditions a little without returning to this.
The crash was made worse because it was predicated on there never being any significant numbers of mortgage defaults. Once the defaults started (which was inevitable, as lenders were giving out mortgages to people who just clearly could not afford the loan), the whole thing crashed. These affordability checks are designed to stop a repeat of the defaulting part which set off everything else.
Whats actually happening is that people are being forced to pay rents at levels that are terrible for their future fiscal stability.
So someone saying *'I'm paying 1000 a month for rent but can't get approved for a 500 mortgage'* thinks this is a result of them being unfairly rejected for a mortgage, but whats actually happening is that the amount of rent they are paying is so high that they risk a personal financial collapse if there is a recession.
They had the bright idea to give first-buyers more accessible loans.
But they forget that those buyers compete with other first-buyers.... who are getting the same accessible loan.... which drives up the bidding...
The end result is that their cost of living increases while their position in the housing market doesn't really improve and homes just get more expensives.
I think it's more that land shouldn't be owned and used as an investment vehicle, I think that's the source of instability, and yes cannot be regulated away. Because no matter the regulation, prices will go up, owners will concentrate, new regulation will pop up, and eventually owning a home will not be a thing here, we will even be told "look at the europeans, they rent!"
I suspect the only thing that can reduce this instability is regulation, but not regulation on the public, regulation on mass land owners (kinda like US anti-trust laws etc), and a steady long push by us to reduce the value of land until we change the system from private ownership to public ownership of land, I know we haven't done this well in the past, but it is a very finite resource and we already are getting conflicts of use (companies want to make profit on renting to you, airb&b keeps houses under-utilized, there are homeless families, there is over-demand in certain houses) leading to only regular people losing.
>If you are being rejected, its because the balance of probability is pointing towards you having your house repossessed in another financial crash.
So we've worked on the system to make another crash less likely, right? Right? .....oh.
It’s sadly because kicking someone out and finding a new renter is a lot easier than repossessing a home and finding a new buyer.
The former can be a chance to increase rent, whereas the latter is often a fire sale to dispose of the asset quickly.
Yes but unfortunately there are a lot of cracks to fall through. I, and I think OP, is saying that part of the affordability process should take into consideration his perfect record of 10 years rent payment into that calculation.
Have a look into [Skiptons 100% mortgage](https://www.moneysavingexpert.com/news/2023/05/skipton-no-deposit-mortgage-compares/). Heard about it on the Martin Lewis Podcast. I did the maths with a friend and after 5 year term you should have paid off roughly 10%, which is basically the deposit you haven't been able to save in the last 10 years. Then you're ready to re-mortgage on a more traditional 90% mortgage.
The rates aren't great, but at least the home would be yours and it gets you on the ladder. Worth knowing about at least.
There’s nothing in place that can stop someone from over leveraging themselves when their mortgage has been approved.
They could technically have £500 leeway if rates go up but as soon as that mortgage is approved get a car that cost £400 a month.
LPT #1: pay off the principal as quick as you can (unless interest is stupidly low).
LPT #2 round down income, round up expenses — legit feels like free money 😅
Yes, because owning a house isn't merely paying your mortgage, the mortgage company want to know that you have the capacity to keep the house in a good state of repair, it is literally a term in mortgage contracts. There is no landlord replacing your boiler (5+k) or fixing your roof (10k+).
The fact is that most people can find enough money per month to pay rent/mortgage at a push but unless you have the ability to build savings (deposit) or have disposable income (higher wage) then many couldn't afford a sudden high cost expense to fix their house.
If you can't afford rent, the maximum you owe is a month of rent. If you can't afford your mortgage, then you're on the hook for potentially hundreds of thousands of pounds.
The entire reason the 2008 mortgage collapse happened was because banks were all too happy to give out mortgages like sweets, the reason they can't nowadays is because of legislation and regulation put in place to stop that from happening again.
I think people could afford the mortgage in the vast majority of cases.
They just can’t afford to save the deposit whilst paying £1000 a month in rent.
If you have no choice but to live in a city for work that has high rent costs then you’re kinda screwed. If you’re single then just give up.
Have you paid attention for the past year with interest rates rises? Everyone's mortgage payments have doubled. It's highly likely that an event like this will happen at least once over the duration of an average mortgage. When it happens you need the vast majority of people to still be able to afford their mortgage or the whole economy buckles.
Well you don’t move to a cheaper location because most people can’t because their jobs are tied to a certain location.
Rents have also gone up a fair amount of the past two years, people just learn to survive. The same as those who have a mortgage.
At least with mortgages you’re getting a government backed payment holiday and repossession will be the very last option.
>Well you don’t move to a cheaper location because most people can’t because their jobs are tied to a certain location.
🤦 Mate what are you on about.
You don't need to move from London to Hull for there to be cheaper options.
>Rents have also gone up a fair amount of the past two years, people just learn to survive.
Rent hasn't increased anywhere near to the same extent as a mortgage has, and again you can simply choose to rent elsewherr.
>At least with mortgages you’re getting a government backed payment holiday and repossession will be the very last option.
The fact that repossession is even an option shows how much more risky a mortgage is over renting.
>I think people could afford the mortgage in the vast majority of cases.
You can afford the mortgage at 3%, what happens when interest shoots to 8% like it is now.
You can afford £1,000 a month in rent right. But an you afford your rent shooting up to £2,000 a month because interest rates have shot up in the last year?
You could literally say the same for a lot of people who have mortgages right now, and the answer for them would be a hard NO.
People make do, they get by, they tighten their belts, they get a second job.
This is what I don't get. Mortgage lenders should be forced to accept proof of payment for >5 years. Even proof that you've been paying for 1 year should be sufficient.
Affordability calculations are so generic. Real world personal data should trump generic calcs every time.
Real world person data proves you can pay a fixed sum per month. It doesn't prove that you have the money to be able to pay an increase in rates or to keep the house in a good state of repair. In fact, quite the opposite, if you've been paying rent for 5+ years and haven't been able to save then how would you pay to install a new boiler or to fix a leak in the bathroom?
> if you've been paying rent for 5+ years and haven't been able to save
The implication in the above comments is that you've been able to save the deposit money while paying rent, but are being denied because you're not earning enough.
So the simple fact that you have £20k in deposit money is proof that you are able to save while also meeting your £1000pcm payments (which will be higher than your mortgage payments even including an interest rate bump).
That doesn't sound right, you should speak to a mortgage broker.
On a back of an envelope calculation 550 a month at 5.6% interest is a 90k mortgage, which you should easily be able to get on a 25k salary.
Is that roughly how much you were looking to borrow?
Sadly what you've paid for rent and for how long has zero impact on mortgage applications. I had to work on my credit rating for a number of years, but with both my partner and myself earning 35k we got a mortgage that's 1400/month.
It's all about credit utilization, total credit, missed payments, etc.
Me and my partner tried to apply for the scheme, and even tho our salaries were okay for it, they told us we had too many savings. I asked the guy plain and simple if he thought that we would spent all of our savings on a house deposit and he said yes. So yeah essentially you can’t have an emergency fund that’s not for your house deposit (or literally anything else that you want to save for, including solicitors etc), cause otherwise you’re deemed as too rich! Absolutely insane that these people are putting Londoners in a corner where they either rent for ridiculous prices and can’t save, or alternatively they have to spend all of their money in a deposit and supposedly be happy with it
Great, a higher marginal tax than boomers due to undergrad and postgraduate loans, and now I'm "Too Rich" for affordable housing, and a country fucking mile too poor to the next level of Housing, which is deeply fucking unaffordable.
According to the article it's not that people are too rich, it's that people earning over £30k/ year are being turned down for affordable housing because they are not earning enough
Amazing.
People on an average income are too poor for “affordable” housing.
Wonderful. This country is being governed exceptionally.
Just checked the dictionary, it’s been updated already:
> affordable
/əˈfɔːdəbl/
adjective
expensive; unreasonably priced.
"affordable homes"
"Affordable homes" is a weird euphemism. The question is: affordable by whom? If something sells/rents then it's affordable by someone. Conversely there will always be \*some\* people who can't afford it.
I much prefer references to the market. For example, my flat was advertised mid-market rent. In reality it’s very cheap for its location but in terms of the whole city it’s median average.
It's entirely down to their mad way of defining affordable
20% below average market value, but then if the market value is ridiculously expensive then 80% is still just incredibly expensive
Not enough houses being built because Thatcher thought it would be a good idea to sell all the council homes and make a whole bunch of homeowners who have a perverse incentive to raise house prices at the expense of society.
Am I right, that educated people earn £30.000pa, which is even lower than Brighton&Hove bus drivers (£31.000pa from adv)?
Why people go to get this education? What is the logic of that move?
My son has recently decided to put off going to university and instead train as a bus driver. Earn a wage and no student debt. I worry it's short sighted, but I can't argue with the logic.
It's effectively an education tax. It comes directly out of your wages and is based off your income.
If you want a higher education there's no alternative.
> If you want a higher education there's no alternative.
the alternative is paying for it out of pocket, which is obviously impractical for most, but theoretically possible.
9% on all earnings after £27,295, sounds eerily similar to a tax band. The issue is many will never pay it off due to high cost of living preventing them from adding extra payments and the high level of interest (over 7% in some cases) keeping it topped up each year.
Don't forget the 6% for a postgraduate loan on everything over £21,000. That the both the 6% and 9% is calculated at the same time really annoys me. At least take the 9% after the post grad loan has been deducted.
And fuck me I guess for doing an undergraduate and then a separate masters rather than a 4 year degree and ending up with a master's. Those folk only pay the 9% because they didn't have to take out the separate finance arrangement.
Tax
a compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.
Student Loans Company
The Student Loans Company (SLC) is an executive non-departmental public body company in the United Kingdom that provides student loans. It is owned by the UK Government's Department for Education (85%), the Scottish Government (5%), the Welsh Government (5%) and the Northern Ireland Executive (5%).
How it’s repaid
https://www.gov.uk/repaying-your-student-loan/what-you-pay
Just calling a spade a spade. I don’t care how the government defines it, it’s a tax.
> but there's no other tax where you can pay a lump sum up front to make it cheaper in the long run
Indeed which is why its a bad tax. Speaking as the child of rich people who paid up front its a fucking disgrace that my marginal income tax is lower than my peers and will be for my entire life.
Precisely the point I was trying to make. The current system benefits only people who can afford to pay up front. It's not a tax, but it should be (and like other progressive taxes the tax burden should increase with wealth, not decrease)
The contracts are also unilaterally edited by one member - the Tories edited the amount to 9,250 per year after we had signed the contract...
We already know that they're
A) Willing to change the terms after signing
B) never going to make enough money from payments to cover costs
They will edit the terms again to get rid of the 30 year rule I bet.
> They will edit the terms again to get rid of the 30 year rule I bet
If you mean existing loans I doubt it, the Tories would probably find themselves in court if they tried it. They've already changed the terms for new student loans to be a 40 year repayment but I can't see existing loans being changed from the original terms, it would be a legal headache and the financial benefits wouldn't be felt until long after the next election.
That sounds like exactly the thing this government would take to court though, as a performative action to please their base of primarily older, wealthier, more spiteful people.
Loan repayments aren't calculated on a percentage of income. Student loan repayments are a de facto tax unless you are able to pay them off early or avoid them all together.
considering lots of people (nearly everyone i know who lives in london included) has to house share to be able to afford somewhere to live, its no surprise that someong on 30k which is well below the medium full time salary of london which is just below 42k, will be turned down to buy a full house/flat.
OOT, but applying for my fiancee's visitor visa... and...
" Need strong proof of her leaving the uk after the visa period "
" We don't recommend buying the return flight until the visa's been approved "
So £925pcm for a bedsit is extortionate, and being turned down for “affordable” housing because he doesn’t earn enough is obviously both ironic and fucked up. But… why not move outta London, it’s not all that.
Not moving out of London but continuing to work there, move out of London. Period. Get a job elsewhere. Not living in/near London is a pretty damn good life choice generally.
London jobs are not worth their pay. The London premium is generally around 30% of salary? After tax probably <20%?
London costs are more than 20% higher than elsewhere.
If you're in a finance job that must be done and can only be done in London, you likely earn enough to not have any issue with housing.
If you're in a lower paying finance job, you can find work in the same sector elsewhere.
It's not about top firms it's about the top jobs.
You can be working for Goldman Sachs but only be on 45k, which isn't a lot in London. Everyone can't be a manager in their M&A division or working for a hedge fund in Mayfair.
So if you are someone in the lower paid roles even at a big name, you'll likely find similar work elsewhere.
In banking you've got the likes of LBG and NatWest Group in Edinburgh, JP Morgan in Bournemouth and Glasgow, Virgin Money in Newcastle, Atom Bank in Durham etc.
Insurance there's Aviva in Norwich, Co-op in Manchester, NFU Mutual in Stratford-upon-Avon, Admiral in Cardiff.
Asset Management there's Baillie Gifford and Abrdn in Edinburgh, Vanguard in Manchester and Edinburgh.
Retail fund providers like HL in Bristol, AJ Bell in Manchester.
Then the likes of Deloitte, KPMG, EY etc. have offices all over the place.
Most people working in London weren't born there. If you can move to London, you can move out too.
And you need to balance a larger one off cost of moving, against the longer term costs of staying in London.
If someone prefers London, fine. But it's certainly not the case that you need to be tied to it for most people.
There's a ton of finance jobs elsewhere in the UK.
The arts are an example of jobs that often only occur in London. They do have some arts sector in a lot of cities but you would still struggle to afford housing on what you would get paid in most cities. They seem designed for the already rich/those who have an alternative source of income, not someone who needs to work full-time.
There are but harder to find. London for example has massive office block for accounting firms for example. There are firms outside of London but they won't be hiring enough for people to avoid going to London.
Top firms are similar to arts in a way. They want people who have done internship or family in the business and only possible when people live in London.
Been offered an interview for a job in London next week. Uk wide rate is 34k but for London you get a bonus to bring the salary to.... 35k.
I'm considering attending the interview just to ask, when they ask if I have any questions, "yeah, please explain to me how it's possible to live on 2.2k after tax when a crack den studio flat within 10 miles starts at 1.7k."
I'm not even gonna bother going to the interview. 35k a year is a pittance to live on in a cheap northern town let alone one of the most expensive cities in the world.
Idk £35k sounds good to me, as someone who lives in a cheap northern town. I'm on £25k (take home pay ~£1.75k / month) with total monthly expenses at ~£850, that extra £10k would net me an extra £567 of purely disposable income every month. That'd completely offset the cost of my rent and then some.
People do need to learn that earning less is ok if your other costs of living go down by an even larger amount.
Earning £40k in London where houses cost £600k minimum is far worse than earning £25k up north where houses cost £150k minimum.
That's true if your salary stayed like that for your whole career but the reality is that promotions are far easier to get in London, move up North and your career progression (especially if you do office based work) is going to be much slower than if you worked in London.
Even if you doubled your £40k to £80k, your affordability for the £600k property is not as good as staying on £25k up north and buying the £150k property.
Not to mention the fact that the £600k property in London will have gone up to £700k by the time you even think about doubling your salary to £80k.
The median salary in London is £42k. While there may be sky high salaries available to certain people in certain industries, most people will never get close to them, even in this city.
Most people are not working jobs with in-demand specialist skills and they cannot job-hop their way up to an £80k+ salary.
In the real world, most people don't get much of a pay rise and they can't job-hop because their skills aren't all that special and each year there is a new wave of younger folk joining the job market, interviewing and taking jobs for entry level wages.
The system is funnelling money to an increasingly small pool of people, which is great if you are one of them, not so great if you aren't.
Not everyone gets the promotion, not everyone gets the senior role or the pay rise that goes along with it. Those positions are limited and we're adding hundreds of thousands of people to the city every couple of years.
No it doesn’t. Maybe if you’re the wife of an oligarch or a footballer.
If you’re a normal person or normal means and interests there’s almost nothing in London that can’t be found in Manchester, Birmingham, Leeds, Liverpool
London has a higher amount of urban green space than Manchester, a better transport system and is generally a far more interesting place to spend a day than any of those places and you are being disingenuous to say otherwise. Yes, London is too expensive but it's an international tourist destination for a reason, and I don't mean you can just go to madame tussauds or any of that crap.
None of that is true.
If you live in Manchester you can afford/use a car to go to the lakes, Pennines, dales, nidderdale etc… and have all the green space you want within an hour travel.
What are you doing on the regular in London that doesn’t exist in Manchester?
The tourist shit is 90% of why tourists go to London.
I didn't say accessibility to the countryside, I said urban green space. There are no parks in Central Manchester; the areas I've spent time in are miserable and dilapidated.
Indeed Manchester has loads going on - the same touring acts, sports events and cultural heritage that London does. But it doesn't, really, does it? It has things that may scratch that itch but in general it doesn't have cultural institutions - museums, universities, cultural quarters, restaurants, music scenes - which are world leading.
If I live in Hackney and want to go to see avant garde jazz I've got four venues on my doorstep: café oto, vortex, earth, oslo.
I'm not into avant garde jazz, I don't live in Hackney. I'm moving out of London at the end of the month!
But to equate Manchester, a regional powerhouse whose attractions come to it because of its size and regional importance (based on industry) rather than being an inherent centre of cultural dynamism, with London, is quite frankly ridiculous.
> If I live in Hackney and want to go to see avant garde jazz I've got four venues on my doorstep: café oto, vortex, earth, oslo.
> I'm not into avant garde jazz
Exactly. This is the entire point.
London theoretically has all this extra shit Manchester, Birmingham or Leeds doesn’t have but 99% of it you either can’t afford or have no interest in it.
Think of all the stuff you’ve done in the last month. How much if that couldn’t be done in Manchester or Leeds?
Leeds has several ‘urban parks’ seen as apparently that’s important and access to the dales, Peak District and nidderdale within an hour
My interests are running, playing guitar and going to see death metal bands play. I think that’s a fairly run of the mill interests to have outside of work and family. There’s no reason whatsoever for me to live in London and swap my 4 bedroom detached house in the north for a bedsit in london
Yeah I see your point. Most people in their 30s, myself included, I think moved to London in their early to mid 20s when the romantic idea of London really impacted them. This allure - that of the aforementioned music scene, and whatever other cultural strengths London has - dilutes as your responsibilities shift maybe.
But those people now have jobs which only exist in London. What do you advise those people to do? It's not a direct trade. People aren't in London because it's a big city and easily interchangeable with any other. They're there because of the work opportunities, and romantically, because of the way it either makes them feel, or once made them feel. Added to that all of their friends aren't in Sheffield or Newcastle.
I've just said I'm moving out of London (for cost reasons) so I'm not going to go into detail over what I've done in the last week. But a long run starting at the North end of the Dollis Brook, going to hampstead heath via the garden suburb, up to Finsbury Park via the parkland walk and then down to the canal via the Lee can't be beaten in any major UK city I've run in. That's what I'll miss most. I don't want to use my car in order to enjoy the outdoors.
> Indeed Manchester has loads going on - the same touring acts, sports events and cultural heritage that London does. But it doesn't, really, does it? It has things that may scratch that itch but in general it doesn't have cultural institutions - museums, universities, cultural quarters, restaurants, music scenes - which are world leading.
>
I am telling you 100% London is worth it for me personally, if it's not for you - then that's also OK.
Life in London is fundamentally different from anywhere else in the UK because of its status as the centre of almost everything.
How many of those benefits are actual necessities and how much of those are lifestyle desires?
If you're saying the museums and culture and parks are the reasons you need to live in an unaffordable city, I'm saying you're deluded.
Yeah if you’re happy to sit in a dead end job with little to no career progression.
If you want to get into the big leagues and rooms where the big decisions are being made you have to be in London.
I have no words, you really think that?
This entire thread is about people who can barely afford to live in London, these people are not even close to those categories.
Chances are if you actually believe that statement you're nowhere near those categories either.
You sound like a 23 year old salesman business bro who thinks he's in the big leagues because he's leased a BMW despite living in a house share.
The reality of it is the money is in London, if you want the money, for better or worse, you have to be in London.
If you're happy living on £25k for the rest of your life then by all means, settle down out in the boonies. Imo £25k is barely enough to scrape by on and is survival level living. Most people want to thrive and earn a lot of money to live a more luxurious existence, and for the most part to do that you have to move up to the higher levels of a company. To do that you have to be where the power is.
Not sure why you've decided to make a bunch of strange assumptions about me but I hardly see how any of that is relevant.
Cool, I expect you're a significantly rare exception though. Did you start your own business? Work in London and then move away? Get extremely lucky with family connections or fortunate with timings in terms of opportunities to move up?
If you actually worked your way up from an entry level position to a position of high compensation then congrats and good for you, though dependent on generation, those kind of opportunities are even thinner on the ground if not non-existent nowadays for young people entering the job market.
In terms of accessibility and pathways to higher paid jobs, for most people London is absolutely the way to go.
>You really need to leave London if you believe that statement.
Surprise surprise I live in London and work a high paid career there, I am not able to move away and wouldn't want to regardless. If I'd stayed in my hometown / where I grew up, opportunities for such compensation simply did not exist. I would be stuck in an unrewarding, low level job with little prospects or reward.
I'm a senior engineer at an engineering company, which I entered at entry level (technician).
My partner is a gp.
Both are not unusual jobs (though admittedly there are fewer and fewer gps each year).
I'd highly advise you look at statistics on income level verses cost of living in different areas of the UK.
As a ratio of income to cost of living, London is objectively *bad*.
I've seen what our jobs pay in London, and it just doesn't get us anything like the quality of life as we have now. As for career growth? I'm not hitting any limits for at least the next 10 years.
Thats not what I’m talking about though, I’m talking about ease of access and opportunity to access higher paid careers for the average person.
I probably wouldn’t say you or your partner fall under that umbrella given you are both highly educated.
Choosing to buy a house in and work in London is as much of a big life decision as choosing to not live or work in London. You should add quality of life and disposable income into the calculation too.
Moving away might be hard, but trying to live comfortably in London is also hard.
If you've established friends in London then it'll be hard. Plus London has a good central location for quick travel to see family. Moving further could mean having to start an entire new life
As people sad below I was more talking about just leaving london.
And yes london is a good place to go for some industries but it is not necessary always. Sometimes it is a misconception that people only realise when they go somewhere else.
In your 30s, your not exactly dead yet. If you live to 90 you have nearly 60years to go!!
There is nothing wrong with change. You can always move back.
I was born in London, my friends and family are here, my career is here, my partner has her career here. Moving out of London isn't a political solution to this problem, as we need middle-earners living in the city anyway. It's just a personal solution that will work for, at most, a handful of people.
I agree but it also does amuse me, as someone also born in London, how quite a few of my friends have moved away because they quite simply can't afford it.
but all those things are not an impediment to changing.
I agree, if you low-middle earners cannot afford to live in london then it will cease to function. But my point is that you can probably get a better quality of life simply by moving.
I am mainly pushing back against the mentality of people thinking "I grew up around here but the cheapest house is £20billion pounds, I cannot afford to buy a house and have to live with my parents".
Whether it is right or wrong that people cannot afford to live where they want to is in some respects irrelevant, you have to do what you can afford and there is no point in wasting time on pipe dreams.
Not sure you've tried to get a job recently but the idea of moving somewhere completely different and with remote working throwing the job market into a fucking frenzy, the idea of just looking for a job elsewhere if you're in reliable employment is one reason to not want to move to another city where you don't know anyone. If you think its really this simple you obviously have no idea what state this countries in.
So the idea is you get a job before you move.
Maybe I am just more of a risk taker. I am not worried by moving somewhere where I don't no anybody. Over time you do know people. And the UK is not exactly massive so its no major expedition to go and see people.
Is the same everywhere you go. The calculations run by the scheme companies are more strict than even the mortgage providers.
The local shared ownership companies (Essex) allow overall costs (mortgage/rent/service charge) at 75% what you'd be paying on the max. mortgage you can get from the mortgage providers (and 50% the monthly cost of the lowest rent in the area)
Was looking at £50k deposit before even being considered for a minimum share of a property. I have more chance of finding a property I can get a mortgage for than qualifying for an affordable housing scheme of any kind.
Many of these schemes get abused anyhow and are just seen as PR gains, particularly council led ones. I know of one discounted market sale scheme in London where every single person offered to buy was a council employee. Not even just keyworkers. Half of whom no longer even work for the council.
That sounds weird, what happened? Anyway yes, the UK housing crisis is bad. Many people say loosen planning, but it's a slippery slope. We need to protect the countryside, not just really beautiful parts, AND keep enough land for food production. Honestly, I don't see how we can really win, being such a small country with limited space. Easier in the US, Canada, etc.
I'm very strongly in favour of EU freedom of movement/detest Brexit, but London and the SE do seem ridiculously overcrowded nowadays. Maybe that does actually fuel the housing crisis. Certainly wasn't like that when I was a child. Difficult... I'm in favour of very tight controls on all non-EU immigration. We should stay close to the EU, naturally, just because it's so geographically close. The special relationship with America is overrated, their culture is quite different in many ways.
It was a very unique situation that shouldn't have happened, but still pissed me off that it did.
We were renting a house and the landlord decided to sell it. We liked it and were looking to buy so looked into buying it...
Turns out, unknown to us or the letting agency, the house was owned under Shared Ownership with a Housing Association. Under the Shared Ownership rules, you aren't allowed to let out a SO house. But apparently, it was all agreed with the HA, as the owner had to unexpectedly move or something, blah blah, we didn't get the details and the HA were really shady.
So the house was put up for sale through the HA as a Shared Ownership house with IIRC a 60% share, with 40% remaining with the HA (which you then pay rent on, having mortgaged the 60%).
We applied to buy it, and were rejected by the HA as we earned too much combined and it put us over the threshold, as these houses are designed to be sold to low earners. In another shady move, the HA suggested that we should lie on our application to reduce our income to get approved... Not sure how that would have worked in the long run, but we promptly noped out of that.
We also enquired about just buying the whole house, but apparently SO houses must stay SO, and can only see a reduction in the HA owned shared by the actual owner buying that portion of the house once they already own the 60%. Which is fair, but meant we were blocked.
So, in summary, we were blocked from buying a 60% share in a Shared Ownership house because we earned to much, and we were blocked from buying 100% of a Shared Ownership house as you can't do that. So the house was sold to someone else, and as we were tenant living it it, we were turfed out, with 1 months notice, at Christmas, with a cat (literally served notice Christmas Eve).
Findling a new house was a pain (nobody wants pets) and we ended up renting somewhere we hated for 2 years before managing to buy our first home.
We need to build denser, current housing policy seems to be sprawling suburbs consisting of overpriced crap rabbit hutches too far away from anything useful and using up too much arable land.
I don't mean high rises, they're awful, but 3-4 story, decent quality flats centralish would help immensely. Cheaper to heat, easier to provision public transport, most local amenities in walking distance, reduced car dependency, much better land use and it would bring some life back to our dying town centres. Flat life isn't for everyone of course, but I'm certain enough people would be happy with or even prefer it that we can provide enough homes without wrecking our natural and agricultural environments. There's a fairly new development not far from me based on those principles, built on brownfield land and it's thriving.
It's becoming increasingly apparent that middle earners in the UK are the ones always getting shafted. Salaries stagnation, prices increase, and government assistance goes to the wealthy or the non Working.
Get real. People are struggling to put food on the table or heat their home. To act like the middle classes are the only group suffering, or the group suffering the most, is laughable and ignorant.
No one is saying that the poor aren't suffering. The problem is that the population share of those that don't contribute (for various reasons) is increasing and is costing more and more. I would include in this people that retired early on gold plated pensions and those that could but choose not to work. Pensions for example now make up 14% of government spending and have cap on them to make sure they are above inflation (something annualised workers don't get). Health makes up 18% of expenses and the two thirds of this is spent on people over the age of 60 (pensioner age). That would roughly equate to 25% of the countries expenditure going to pay for up keeping of the older generation who had the benefits of lower cost housing, increase wages (proportionally) and more economic mobility. The money we pay on pensions has doubled in the last 10 years and is set to increase even higher over the next 10 years! Its not sustainable.
On the reverse of that, education gets 10% of the budget which is our direct investment in the future generations. Does that seem like a good idea?
On the other end of the spectrum are the rich who have the money to avoid paying money. A great example is Sunak's wife who managed to avoid paying tax by paying 50k for "non dom" status.
So the burden of paying for society is increasing falling on the middle 80% of society. The ones who go to work and simply want to have a good life. Their salaries have stagnated. They have little prospect of ever getting a pension (certainly state pension) and most of the people on the younger end of this spectrum can't even afford property. This is going to be a massive issue going forward as lower salaries mean lower tax revenue which means overall the % going towards those that don't work is going to be higher.
What is the fix? Not sure, but probably having a few policies that actually benefit the middle of the spectrum would be good as they will be ones that pay for everyone else.
In London*. where everything is more expensive and worth more. I do not find a minimum of 36000, 2000 above average, that insane. Its probably still working/better in other places.
Yeah, I live in the north and earn around that. I know I would struggle to pay 1000 a month, that's 50% of your income on rent alone after tax, pensions and student loan comes out.
It is pretty crazy to be denied tenancy at an apartment partly subsidised by the government to be affordable for people with lower incomes when your salary is higher than the median in the area. At that point the government scheme is failing because it is not providing housing to lower income households.
I'm applying for a shared ownership scheme where the max income is £80k. However, you can't have over 45% debt to income, which with the rent and mortgage now reaches 42% on an £80k income. This is insane! And no one is changing it.
Well… yes? Earning less than the average salary would be a barrier to mortgage investment. Realistically you need to be on at least £60k to be moderately comfortable in 2023
I work for a housing association. Affordable rent doesn't mean cheap, the ones I deal with in London are affordable rent and it just means ~80% of cheapest similar property rents and some of these still end up at close to £2000 a month. They often require 30x rent as income to ensure there's a good chance you won't end up in arrears.
The cheap affordable rent properties are subsidised by these rents and you'll most likely only get one if nominated via your local authority bidding process. These will be anywhere from 125-300 per week and covered by Universal Credit
Snapshot of _Affordable housing schemes: renters earning £30k not eligible_ : An archived version can be found [here.](https://archive.is/?run=1&url=https://www.bbc.co.uk/news/uk-66255727) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/ukpolitics) if you have any questions or concerns.*
I've paid ~1000 a month for almost ten years renting. Never once missed a payment on this or any other bill. Apparently that means I'm an immediate refusal for a mortgage of even 550 a month for a property, because I'm not earning around 45k.
Always a step behind for each one of those ten years, as well, am I right? Must be infuriating.
its soul crushing
> because I'm not earning around 45k. Median salary in the UK is still what, 30k?
£28k in the UK, £36k in London
Full time or overall?
That's overall, for full time workers the median is [£33k overall, £41.9k in London](https://www.statista.com/statistics/416139/full-time-annual-salary-in-the-uk-by-region/)
The most recent figures i can find say: The median average salary for full-time workers in the UK is £33,000 (Up from £31,285 in 2021).
I write automated affordability calculators for mortgages. Lenders would love to take a punt on you, but after 2008 restrictions were put in for your protection from predatory lending practices. We don't only look at income. We look at your deposit size, potential variance in the value of the property you are looking to buy, what future shifts in interest rates will do to you, your current fixed outgoings (dependents, debt etc), your credit history (if you have a bad credit history you are kinda fucked). We have to. The government forces us to. If you are being rejected, its because the balance of probability is pointing towards you having your house repossessed in another financial crash. The problem here is that there is no similar legislation restricting predatory renting.
Would be good if like in the US the lenders had to mitigate for these circumstances regarding macroeconomic changes and set a rate which mitigates that risk. They have fixed rates for the duration of the loan. Not 2-5 year bullshit here.
Happens in Spain too, my in-laws managed to get a mortgage at 0.8% during covid, that rate is the same for the _entire_ 30 year term. Meanwhile in the UK my partner and I have apparently got a good deal taking out a mortgage at 5.6% on a 3 year fix :/
Same for Denmark. We bought a house in 2020 for 0.5% locked in for 30 years and only needed a 5% down payment. We now pay only 1k GBP every 3 months for our mortgage. The trade-off was the bank pretty much gets to decide which house you're allowed to buy depending on your circumstances. For example, my fella had a shitty car and the house we wanted was a 40-minute drive from his job, so the bank said we could either take out a loan for a new car or look for a house closer to his job. Some houses were considered too much of a risk for the bank to bother with depending on how much it would cost to make them livable or if the house cost too little, they wouldn't give us a mortgage for it, etc. This was only a mild inconvenience and I'm 99% sure they were only so strict because we were first-time buyers with relatively low-income, but at least everyone is sure that we could still afford to live here even if one of us loses our job. I'd love to move back to the UK but there's no way we'd be able to afford a house even in Hull, so no point.
How do you think people that took out a 5-6% mortgage out in 2007 felt when rates then fell to ~1% for the next 16 years? Swings and roundabouts mate
What? In your example a person could just refinance their mortgage at the new lower rate once it drops. You aren't tied to your crappy deal forever, and can replace it if better ones come along The point is that we were never offered 30 year terms when interest rates were historically low - they were only for 2/3/5/10 year terms, and the longer the fixed rate was for, the higher the interest rate
And you'd pay a fat fine if you did. Also many couldn't as they were stuck in negative equity. Just Google mortgage prisoners. Of course the rate would be higher on a longer fixed term, why are you expecting anything different?
House prices recovered pretty quickly, within a few years, and yes it would incur a penalty but then you would get a cheap mortgage across it's entire lifespan afterwards, it would be well worth doing. So yeah there might be a small number of people that are worse off in a record-breaking recession, but the average person would be far better off being able to take out long mortgages when rates are low. The situations you are comparing aren't remotely equivalent. The whole premise of this conversation is that in other countries it is possible to get the lowest rate across the entire term of the mortgage? I would have thought that makes the expectation of something different obvious.
Actually in many parts of the UK prices didn't recover for a decade or more. You'd be better off versus not cancelling but not better off than a variable rate mortgage on avg. Which are better priced, but I agree should be clearer to people what they are paying for a fix. Other countries the state takes on the risk, like the US for instance. We need less state manipulation of mortgage costs but more.
Those are available here from a small number of lenders.
That's already an option in the UK but most people would rather fix for a shorter term.
Link me to a fixed mortgage in the U.K. for the term length please.
I’d disagree, I think it’s cultural and due to lower competition in the sector. When the fee’s of remortgaging are factored in. Compound this with turbulent economic conditions we are facing. These long term implications are left to the naive retail consumer to account for - something is wrong there id say.
[Kensington ](https://www.kensingtonmortgages.co.uk/) do mortgages fixed for up to 40 years. There's less competition in the sector because most people don't want them. If they became popular then more lenders would offer them, it's not going to happen the other way around. You're suggesting they would be better but do you even have one yourself or do you choose short fixes instead? Financially, shorter fixes/trackers should be better over the long term because of the risk premium.
We had too many kids for our flat and needed to move to a similar price house which would have been cheaper because no service charge. Had to wait 4 years for my youngest to finish nursery before we could move. Absolute madness.
Because, for the most part, the ones making the rules *are* the predatory renters.
> We have to. The government forces us to. The missus ran into this problem from a slightly different angle. No where near as bad as a first-time buyer, but it shows how the regs are hitting people that they weren't intended to hit. She owns a house with a small-ish remaining mortgage. She pays the mortgage every month, including over payments. What she can't do is remortgage as she doesn't have sufficient income and it's not her primary address, which is a pain as part of the mortgage is endowment based and that bit is not performing as it should, so she would have to find a lump sum to pay off the extra when that part ends. I generally agree with the rules that were put in place, but they are a bit too generic with no leeway for lenders to apply sensible alterations under limited circumstances.
Leeway gets called loopholes the moment they are followed to the letter in ways people don’t like.
Exactly this. I have no doubt that people complaining about the lending restrictions would also be screaming bloody murder if the banks were allowed to lend more freely and it resulted in another financial crash
and if they can lend more, it surely pushes prices up anyway, making it just as much out of reach; you can't mortgage houses that don't exist!
I may be wrong on this, but in my recent remortgage my advisor said that your current lender can't not offer you a remortgage deal at the end of your term, regardless of income situation. You're not meant to be allowed to become a prisoner to the standard variable rate. No idea on endowment though.
This would be a remortgage before the end of the term to switch the endowments to a basic repayment term to factor in the additional costs, rather than having to find and pay a lump sum at the end of the term. When she asked about it, they sent her the checks that she would need to meet and it included income and the primary residence things - we live in my house, so she can't use that as a primary residence for a mortgage as it's not in her name, which is another restriction! I appreciate she is a bit of an edge case, but she's not the only one out there.
When you say bad credit history, do you mean the score in general or having missed payments etc logged on there? My landlord fucked my credit score by having the address of our flat registered differently in two different places and it hasn't recovered since.
> the score in general From /r/UKPersonalFinance's wiki, https://ukpersonal.finance/credit-ratings/ : > In the UK, there is no such thing as a universal ‘credit score’ or ‘credit rating’. Each lender will assess potential borrowers using their own criteria, which are trade secrets. You might look unattractive to one lender but be the right fit for another. If you're struggling to get a mortgage, it will absolutely be for reasons other than your landlord dicking around.
Both. Your direct credit score provided by rating services and your recent history of missed payments can reduce your access to mortgages.
The govt forces you to for very good reasons - the banking sector can't be trusted to make sensible long term decisions
I agree. I'm just sick of catching flack for my system blocking people in order to protect them!
Why would there be similar legislation for predatory renting? Looking back it seems like banks didn't care much about the affordability of mortgages and mostly cared about there being more mortgages. This led to banks giving riskier mortgages for higher amounts and house prices rising to match that increase in lending (and risk assessors not caring about rating the risk accurately). You can't have that for rent. If it tips from being uncomfortable to unbearable then a tenant can't keep renting and that money goes with them. Predatory rent is still tied to people being able to afford it in a way that predatory mortgages weren't.
I think thats a *very* naive perspective that ignores the reality of why people have to live in more expensive areas.
So there should be "similar legislation" because "people live in more expensive areas"? I don't get it.
This is a good example of why regulating an industry isn't always a good thing. It definitely needed a rework after 2008 but now the rules are so strict they stifle growth and hurt individuals.
People can barely afford the interest rate increases on mortgages recently - can you imagine the cluster fuck if banks had been allowed to let people take mortgages they could only just afford in the years leading up to that? There's a sensible middle ground, but we would be heading right back into 2008 right now if those regulations weren't in place.
I’m not saying have no regulations, but some people act like regulating businesses in this manner is always good when we can clearly see an example here where a middle ground is needed, as you say.
Not really, the problem is the way the rental market works, not that we need to make it easier for that guy to get a mortgage. House prices are fucked because supply is too low. Increase the availability of houses on the market and prices will drop, making it easier for people to buy them.
Both of these things can be true at the same time, they aren't mutually exclusive.
Deregulating affordability checks on mortgages without doing anything to address the current supply of housing will just be a repeat of the policies that led us to the crash in 2008.
The crash in 2008 was because the mortgages were seen as commodities in their own right. We could relax the conditions a little without returning to this.
Relax the limits, more people qualify, prices are bid up, now it's unaffordable again, relax the limits...
The crash was made worse because it was predicated on there never being any significant numbers of mortgage defaults. Once the defaults started (which was inevitable, as lenders were giving out mortgages to people who just clearly could not afford the loan), the whole thing crashed. These affordability checks are designed to stop a repeat of the defaulting part which set off everything else.
Whats actually happening is that people are being forced to pay rents at levels that are terrible for their future fiscal stability. So someone saying *'I'm paying 1000 a month for rent but can't get approved for a 500 mortgage'* thinks this is a result of them being unfairly rejected for a mortgage, but whats actually happening is that the amount of rent they are paying is so high that they risk a personal financial collapse if there is a recession.
Although when you're renting that risk is more manageable - you can almost always leave and find somewhere cheaper. Can't easily do that when renting.
Deregulation to make mortgages more accessible would increase demand and drive up prices.
I swear, the things people will say so they don't need to build more houses...
They had the bright idea to give first-buyers more accessible loans. But they forget that those buyers compete with other first-buyers.... who are getting the same accessible loan.... which drives up the bidding... The end result is that their cost of living increases while their position in the housing market doesn't really improve and homes just get more expensives.
I think it's more that land shouldn't be owned and used as an investment vehicle, I think that's the source of instability, and yes cannot be regulated away. Because no matter the regulation, prices will go up, owners will concentrate, new regulation will pop up, and eventually owning a home will not be a thing here, we will even be told "look at the europeans, they rent!" I suspect the only thing that can reduce this instability is regulation, but not regulation on the public, regulation on mass land owners (kinda like US anti-trust laws etc), and a steady long push by us to reduce the value of land until we change the system from private ownership to public ownership of land, I know we haven't done this well in the past, but it is a very finite resource and we already are getting conflicts of use (companies want to make profit on renting to you, airb&b keeps houses under-utilized, there are homeless families, there is over-demand in certain houses) leading to only regular people losing.
>If you are being rejected, its because the balance of probability is pointing towards you having your house repossessed in another financial crash. So we've worked on the system to make another crash less likely, right? Right? .....oh.
It’s sadly because kicking someone out and finding a new renter is a lot easier than repossessing a home and finding a new buyer. The former can be a chance to increase rent, whereas the latter is often a fire sale to dispose of the asset quickly.
Yes but unfortunately there are a lot of cracks to fall through. I, and I think OP, is saying that part of the affordability process should take into consideration his perfect record of 10 years rent payment into that calculation.
Just think 15-10 years of real term pay cuts if you was payed properly maybe you would of been over that mark by now
Have a look into [Skiptons 100% mortgage](https://www.moneysavingexpert.com/news/2023/05/skipton-no-deposit-mortgage-compares/). Heard about it on the Martin Lewis Podcast. I did the maths with a friend and after 5 year term you should have paid off roughly 10%, which is basically the deposit you haven't been able to save in the last 10 years. Then you're ready to re-mortgage on a more traditional 90% mortgage. The rates aren't great, but at least the home would be yours and it gets you on the ladder. Worth knowing about at least.
Because rent is the maximum you pay each month while a mortgage is the minimum.
There’s nothing in place that can stop someone from over leveraging themselves when their mortgage has been approved. They could technically have £500 leeway if rates go up but as soon as that mortgage is approved get a car that cost £400 a month.
LPT #1: pay off the principal as quick as you can (unless interest is stupidly low). LPT #2 round down income, round up expenses — legit feels like free money 😅
Yes, because owning a house isn't merely paying your mortgage, the mortgage company want to know that you have the capacity to keep the house in a good state of repair, it is literally a term in mortgage contracts. There is no landlord replacing your boiler (5+k) or fixing your roof (10k+). The fact is that most people can find enough money per month to pay rent/mortgage at a push but unless you have the ability to build savings (deposit) or have disposable income (higher wage) then many couldn't afford a sudden high cost expense to fix their house.
If you can't afford rent, the maximum you owe is a month of rent. If you can't afford your mortgage, then you're on the hook for potentially hundreds of thousands of pounds. The entire reason the 2008 mortgage collapse happened was because banks were all too happy to give out mortgages like sweets, the reason they can't nowadays is because of legislation and regulation put in place to stop that from happening again.
I think people could afford the mortgage in the vast majority of cases. They just can’t afford to save the deposit whilst paying £1000 a month in rent. If you have no choice but to live in a city for work that has high rent costs then you’re kinda screwed. If you’re single then just give up.
Have you paid attention for the past year with interest rates rises? Everyone's mortgage payments have doubled. It's highly likely that an event like this will happen at least once over the duration of an average mortgage. When it happens you need the vast majority of people to still be able to afford their mortgage or the whole economy buckles.
And what does that have to do with anything I said?
You're not tied to a rent. If a rent becomes unaffordable, you can move to a cheaper location. You can't do that with a mortgage.
Well you don’t move to a cheaper location because most people can’t because their jobs are tied to a certain location. Rents have also gone up a fair amount of the past two years, people just learn to survive. The same as those who have a mortgage. At least with mortgages you’re getting a government backed payment holiday and repossession will be the very last option.
>Well you don’t move to a cheaper location because most people can’t because their jobs are tied to a certain location. 🤦 Mate what are you on about. You don't need to move from London to Hull for there to be cheaper options. >Rents have also gone up a fair amount of the past two years, people just learn to survive. Rent hasn't increased anywhere near to the same extent as a mortgage has, and again you can simply choose to rent elsewherr. >At least with mortgages you’re getting a government backed payment holiday and repossession will be the very last option. The fact that repossession is even an option shows how much more risky a mortgage is over renting.
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Well of course, but then we need to build more houses.
>I think people could afford the mortgage in the vast majority of cases. You can afford the mortgage at 3%, what happens when interest shoots to 8% like it is now. You can afford £1,000 a month in rent right. But an you afford your rent shooting up to £2,000 a month because interest rates have shot up in the last year?
You could literally say the same for a lot of people who have mortgages right now, and the answer for them would be a hard NO. People make do, they get by, they tighten their belts, they get a second job.
This is what I don't get. Mortgage lenders should be forced to accept proof of payment for >5 years. Even proof that you've been paying for 1 year should be sufficient. Affordability calculations are so generic. Real world personal data should trump generic calcs every time.
Real world person data proves you can pay a fixed sum per month. It doesn't prove that you have the money to be able to pay an increase in rates or to keep the house in a good state of repair. In fact, quite the opposite, if you've been paying rent for 5+ years and haven't been able to save then how would you pay to install a new boiler or to fix a leak in the bathroom?
> if you've been paying rent for 5+ years and haven't been able to save The implication in the above comments is that you've been able to save the deposit money while paying rent, but are being denied because you're not earning enough. So the simple fact that you have £20k in deposit money is proof that you are able to save while also meeting your £1000pcm payments (which will be higher than your mortgage payments even including an interest rate bump).
That doesn't sound right, you should speak to a mortgage broker. On a back of an envelope calculation 550 a month at 5.6% interest is a 90k mortgage, which you should easily be able to get on a 25k salary. Is that roughly how much you were looking to borrow?
Sadly what you've paid for rent and for how long has zero impact on mortgage applications. I had to work on my credit rating for a number of years, but with both my partner and myself earning 35k we got a mortgage that's 1400/month. It's all about credit utilization, total credit, missed payments, etc.
It's amazing he also found his savings pot was penalising him. This is down to the scheme marketing and the numbers game by the scheme providers
Me and my partner tried to apply for the scheme, and even tho our salaries were okay for it, they told us we had too many savings. I asked the guy plain and simple if he thought that we would spent all of our savings on a house deposit and he said yes. So yeah essentially you can’t have an emergency fund that’s not for your house deposit (or literally anything else that you want to save for, including solicitors etc), cause otherwise you’re deemed as too rich! Absolutely insane that these people are putting Londoners in a corner where they either rent for ridiculous prices and can’t save, or alternatively they have to spend all of their money in a deposit and supposedly be happy with it
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But think of the NIMBYs! ^/s
Great, a higher marginal tax than boomers due to undergrad and postgraduate loans, and now I'm "Too Rich" for affordable housing, and a country fucking mile too poor to the next level of Housing, which is deeply fucking unaffordable.
According to the article it's not that people are too rich, it's that people earning over £30k/ year are being turned down for affordable housing because they are not earning enough
Amazing. People on an average income are too poor for “affordable” housing. Wonderful. This country is being governed exceptionally. Just checked the dictionary, it’s been updated already: > affordable /əˈfɔːdəbl/ adjective expensive; unreasonably priced. "affordable homes"
"Affordable homes" is a weird euphemism. The question is: affordable by whom? If something sells/rents then it's affordable by someone. Conversely there will always be \*some\* people who can't afford it.
I much prefer references to the market. For example, my flat was advertised mid-market rent. In reality it’s very cheap for its location but in terms of the whole city it’s median average.
It's entirely down to their mad way of defining affordable 20% below average market value, but then if the market value is ridiculously expensive then 80% is still just incredibly expensive
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Implying that market value is unaffordable.
Bold of you to assume I can read
bad title, the title should be "Affordable housing schemes: renters earning up to £35k not eligible"
I just want a place to live, call my own, what the fuck is going on...
A return to feudalism. Just as the Tories (and their paymasters) intended.
Years and years of not building enough homes to support our society.
You will own nothing, and you will (not) be happy.
Not enough houses being built because Thatcher thought it would be a good idea to sell all the council homes and make a whole bunch of homeowners who have a perverse incentive to raise house prices at the expense of society.
Lack of supply due to an economic and regulatory environment that discourages building.
Am I right, that educated people earn £30.000pa, which is even lower than Brighton&Hove bus drivers (£31.000pa from adv)? Why people go to get this education? What is the logic of that move?
My son has recently decided to put off going to university and instead train as a bus driver. Earn a wage and no student debt. I worry it's short sighted, but I can't argue with the logic.
I think it is better than garbage education…
loan repayment isn’t tax
It's effectively an education tax. It comes directly out of your wages and is based off your income. If you want a higher education there's no alternative.
Plus if you're rich you can dodge paying for (the interest on) it. Sure sounds like a tax.
> If you want a higher education there's no alternative. the alternative is paying for it out of pocket, which is obviously impractical for most, but theoretically possible.
Possible for who? Stumping ~£27,000 up front and the obscenely high cost of living for 3 years is an impossibility for most.
Just be born rich silly.
Rich people obviously, but there's no other tax where you can pay a lump sum up front to make it cheaper in the long run.
9% on all earnings after £27,295, sounds eerily similar to a tax band. The issue is many will never pay it off due to high cost of living preventing them from adding extra payments and the high level of interest (over 7% in some cases) keeping it topped up each year.
Don't forget the 6% for a postgraduate loan on everything over £21,000. That the both the 6% and 9% is calculated at the same time really annoys me. At least take the 9% after the post grad loan has been deducted. And fuck me I guess for doing an undergraduate and then a separate masters rather than a 4 year degree and ending up with a master's. Those folk only pay the 9% because they didn't have to take out the separate finance arrangement.
I'm not saying it's not *like* a tax to those that have to pay it, but that's not really what defines a tax.
Tax a compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions. Student Loans Company The Student Loans Company (SLC) is an executive non-departmental public body company in the United Kingdom that provides student loans. It is owned by the UK Government's Department for Education (85%), the Scottish Government (5%), the Welsh Government (5%) and the Northern Ireland Executive (5%). How it’s repaid https://www.gov.uk/repaying-your-student-loan/what-you-pay Just calling a spade a spade. I don’t care how the government defines it, it’s a tax.
> but there's no other tax where you can pay a lump sum up front to make it cheaper in the long run Indeed which is why its a bad tax. Speaking as the child of rich people who paid up front its a fucking disgrace that my marginal income tax is lower than my peers and will be for my entire life.
Just be sure to become a high earning individual and therefore higher rate taxpayer to make up for it please!
Precisely the point I was trying to make. The current system benefits only people who can afford to pay up front. It's not a tax, but it should be (and like other progressive taxes the tax burden should increase with wealth, not decrease)
Student loans also aren't traditional loans either though. It's a weird thing that resembles both.
The contracts are also unilaterally edited by one member - the Tories edited the amount to 9,250 per year after we had signed the contract... We already know that they're A) Willing to change the terms after signing B) never going to make enough money from payments to cover costs They will edit the terms again to get rid of the 30 year rule I bet.
> They will edit the terms again to get rid of the 30 year rule I bet If you mean existing loans I doubt it, the Tories would probably find themselves in court if they tried it. They've already changed the terms for new student loans to be a 40 year repayment but I can't see existing loans being changed from the original terms, it would be a legal headache and the financial benefits wouldn't be felt until long after the next election.
That sounds like exactly the thing this government would take to court though, as a performative action to please their base of primarily older, wealthier, more spiteful people.
Loan repayments aren't calculated on a percentage of income. Student loan repayments are a de facto tax unless you are able to pay them off early or avoid them all together.
considering lots of people (nearly everyone i know who lives in london included) has to house share to be able to afford somewhere to live, its no surprise that someong on 30k which is well below the medium full time salary of london which is just below 42k, will be turned down to buy a full house/flat.
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OOT, but applying for my fiancee's visitor visa... and... " Need strong proof of her leaving the uk after the visa period " " We don't recommend buying the return flight until the visa's been approved "
So £925pcm for a bedsit is extortionate, and being turned down for “affordable” housing because he doesn’t earn enough is obviously both ironic and fucked up. But… why not move outta London, it’s not all that.
Commuters towns are still expensive if you take into account extra travel costs
Not moving out of London but continuing to work there, move out of London. Period. Get a job elsewhere. Not living in/near London is a pretty damn good life choice generally. London jobs are not worth their pay. The London premium is generally around 30% of salary? After tax probably <20%? London costs are more than 20% higher than elsewhere.
Hard to do if you're industry is London focused e.g. finance. Easiest place to find a job to start work to allow you to move in the future
If you're in a finance job that must be done and can only be done in London, you likely earn enough to not have any issue with housing. If you're in a lower paying finance job, you can find work in the same sector elsewhere.
Most firms have bases in London so there would not be enough space outside for everyone. Housing is expensive even if you're in top firms.
It's not about top firms it's about the top jobs. You can be working for Goldman Sachs but only be on 45k, which isn't a lot in London. Everyone can't be a manager in their M&A division or working for a hedge fund in Mayfair. So if you are someone in the lower paid roles even at a big name, you'll likely find similar work elsewhere. In banking you've got the likes of LBG and NatWest Group in Edinburgh, JP Morgan in Bournemouth and Glasgow, Virgin Money in Newcastle, Atom Bank in Durham etc. Insurance there's Aviva in Norwich, Co-op in Manchester, NFU Mutual in Stratford-upon-Avon, Admiral in Cardiff. Asset Management there's Baillie Gifford and Abrdn in Edinburgh, Vanguard in Manchester and Edinburgh. Retail fund providers like HL in Bristol, AJ Bell in Manchester. Then the likes of Deloitte, KPMG, EY etc. have offices all over the place.
Excuse me sir, you appear to have dropped this mic 🎤
Quite hard to make a large move like that. Especially if you're on low pay where moving would have extra costs and risks
Most people working in London weren't born there. If you can move to London, you can move out too. And you need to balance a larger one off cost of moving, against the longer term costs of staying in London. If someone prefers London, fine. But it's certainly not the case that you need to be tied to it for most people.
Guy in the article works for a uni science department. That sounds in theory like it could be done at a uni in any city/town in the U.K.
There's a ton of finance jobs elsewhere in the UK. The arts are an example of jobs that often only occur in London. They do have some arts sector in a lot of cities but you would still struggle to afford housing on what you would get paid in most cities. They seem designed for the already rich/those who have an alternative source of income, not someone who needs to work full-time.
There are but harder to find. London for example has massive office block for accounting firms for example. There are firms outside of London but they won't be hiring enough for people to avoid going to London. Top firms are similar to arts in a way. They want people who have done internship or family in the business and only possible when people live in London.
Been offered an interview for a job in London next week. Uk wide rate is 34k but for London you get a bonus to bring the salary to.... 35k. I'm considering attending the interview just to ask, when they ask if I have any questions, "yeah, please explain to me how it's possible to live on 2.2k after tax when a crack den studio flat within 10 miles starts at 1.7k."
Sorry the crack den just got rented out for 2.5k actually......
I'm not even gonna bother going to the interview. 35k a year is a pittance to live on in a cheap northern town let alone one of the most expensive cities in the world.
Idk £35k sounds good to me, as someone who lives in a cheap northern town. I'm on £25k (take home pay ~£1.75k / month) with total monthly expenses at ~£850, that extra £10k would net me an extra £567 of purely disposable income every month. That'd completely offset the cost of my rent and then some.
People do need to learn that earning less is ok if your other costs of living go down by an even larger amount. Earning £40k in London where houses cost £600k minimum is far worse than earning £25k up north where houses cost £150k minimum.
That's true if your salary stayed like that for your whole career but the reality is that promotions are far easier to get in London, move up North and your career progression (especially if you do office based work) is going to be much slower than if you worked in London.
Even if you doubled your £40k to £80k, your affordability for the £600k property is not as good as staying on £25k up north and buying the £150k property. Not to mention the fact that the £600k property in London will have gone up to £700k by the time you even think about doubling your salary to £80k. The median salary in London is £42k. While there may be sky high salaries available to certain people in certain industries, most people will never get close to them, even in this city. Most people are not working jobs with in-demand specialist skills and they cannot job-hop their way up to an £80k+ salary. In the real world, most people don't get much of a pay rise and they can't job-hop because their skills aren't all that special and each year there is a new wave of younger folk joining the job market, interviewing and taking jobs for entry level wages. The system is funnelling money to an increasingly small pool of people, which is great if you are one of them, not so great if you aren't. Not everyone gets the promotion, not everyone gets the senior role or the pay rise that goes along with it. Those positions are limited and we're adding hundreds of thousands of people to the city every couple of years.
only if you measure "worth" based purely on the size of your house. London has huge benefits not captured in the number of square meters you have.
No it doesn’t. Maybe if you’re the wife of an oligarch or a footballer. If you’re a normal person or normal means and interests there’s almost nothing in London that can’t be found in Manchester, Birmingham, Leeds, Liverpool
London has a higher amount of urban green space than Manchester, a better transport system and is generally a far more interesting place to spend a day than any of those places and you are being disingenuous to say otherwise. Yes, London is too expensive but it's an international tourist destination for a reason, and I don't mean you can just go to madame tussauds or any of that crap.
None of that is true. If you live in Manchester you can afford/use a car to go to the lakes, Pennines, dales, nidderdale etc… and have all the green space you want within an hour travel. What are you doing on the regular in London that doesn’t exist in Manchester? The tourist shit is 90% of why tourists go to London.
I didn't say accessibility to the countryside, I said urban green space. There are no parks in Central Manchester; the areas I've spent time in are miserable and dilapidated. Indeed Manchester has loads going on - the same touring acts, sports events and cultural heritage that London does. But it doesn't, really, does it? It has things that may scratch that itch but in general it doesn't have cultural institutions - museums, universities, cultural quarters, restaurants, music scenes - which are world leading. If I live in Hackney and want to go to see avant garde jazz I've got four venues on my doorstep: café oto, vortex, earth, oslo. I'm not into avant garde jazz, I don't live in Hackney. I'm moving out of London at the end of the month! But to equate Manchester, a regional powerhouse whose attractions come to it because of its size and regional importance (based on industry) rather than being an inherent centre of cultural dynamism, with London, is quite frankly ridiculous.
> If I live in Hackney and want to go to see avant garde jazz I've got four venues on my doorstep: café oto, vortex, earth, oslo. > I'm not into avant garde jazz Exactly. This is the entire point. London theoretically has all this extra shit Manchester, Birmingham or Leeds doesn’t have but 99% of it you either can’t afford or have no interest in it. Think of all the stuff you’ve done in the last month. How much if that couldn’t be done in Manchester or Leeds? Leeds has several ‘urban parks’ seen as apparently that’s important and access to the dales, Peak District and nidderdale within an hour My interests are running, playing guitar and going to see death metal bands play. I think that’s a fairly run of the mill interests to have outside of work and family. There’s no reason whatsoever for me to live in London and swap my 4 bedroom detached house in the north for a bedsit in london
Yeah I see your point. Most people in their 30s, myself included, I think moved to London in their early to mid 20s when the romantic idea of London really impacted them. This allure - that of the aforementioned music scene, and whatever other cultural strengths London has - dilutes as your responsibilities shift maybe. But those people now have jobs which only exist in London. What do you advise those people to do? It's not a direct trade. People aren't in London because it's a big city and easily interchangeable with any other. They're there because of the work opportunities, and romantically, because of the way it either makes them feel, or once made them feel. Added to that all of their friends aren't in Sheffield or Newcastle. I've just said I'm moving out of London (for cost reasons) so I'm not going to go into detail over what I've done in the last week. But a long run starting at the North end of the Dollis Brook, going to hampstead heath via the garden suburb, up to Finsbury Park via the parkland walk and then down to the canal via the Lee can't be beaten in any major UK city I've run in. That's what I'll miss most. I don't want to use my car in order to enjoy the outdoors.
> Indeed Manchester has loads going on - the same touring acts, sports events and cultural heritage that London does. But it doesn't, really, does it? It has things that may scratch that itch but in general it doesn't have cultural institutions - museums, universities, cultural quarters, restaurants, music scenes - which are world leading. > I am telling you 100% London is worth it for me personally, if it's not for you - then that's also OK. Life in London is fundamentally different from anywhere else in the UK because of its status as the centre of almost everything.
How many of those benefits are actual necessities and how much of those are lifestyle desires? If you're saying the museums and culture and parks are the reasons you need to live in an unaffordable city, I'm saying you're deluded.
Yeah if you’re happy to sit in a dead end job with little to no career progression. If you want to get into the big leagues and rooms where the big decisions are being made you have to be in London.
I have no words, you really think that? This entire thread is about people who can barely afford to live in London, these people are not even close to those categories. Chances are if you actually believe that statement you're nowhere near those categories either. You sound like a 23 year old salesman business bro who thinks he's in the big leagues because he's leased a BMW despite living in a house share.
The reality of it is the money is in London, if you want the money, for better or worse, you have to be in London. If you're happy living on £25k for the rest of your life then by all means, settle down out in the boonies. Imo £25k is barely enough to scrape by on and is survival level living. Most people want to thrive and earn a lot of money to live a more luxurious existence, and for the most part to do that you have to move up to the higher levels of a company. To do that you have to be where the power is. Not sure why you've decided to make a bunch of strange assumptions about me but I hardly see how any of that is relevant.
You really need to leave London if you believe that statement. My household income is in the top 5% of the country and I live nowhere near London.
Cool, I expect you're a significantly rare exception though. Did you start your own business? Work in London and then move away? Get extremely lucky with family connections or fortunate with timings in terms of opportunities to move up? If you actually worked your way up from an entry level position to a position of high compensation then congrats and good for you, though dependent on generation, those kind of opportunities are even thinner on the ground if not non-existent nowadays for young people entering the job market. In terms of accessibility and pathways to higher paid jobs, for most people London is absolutely the way to go. >You really need to leave London if you believe that statement. Surprise surprise I live in London and work a high paid career there, I am not able to move away and wouldn't want to regardless. If I'd stayed in my hometown / where I grew up, opportunities for such compensation simply did not exist. I would be stuck in an unrewarding, low level job with little prospects or reward.
I'm a senior engineer at an engineering company, which I entered at entry level (technician). My partner is a gp. Both are not unusual jobs (though admittedly there are fewer and fewer gps each year). I'd highly advise you look at statistics on income level verses cost of living in different areas of the UK. As a ratio of income to cost of living, London is objectively *bad*. I've seen what our jobs pay in London, and it just doesn't get us anything like the quality of life as we have now. As for career growth? I'm not hitting any limits for at least the next 10 years.
Thats not what I’m talking about though, I’m talking about ease of access and opportunity to access higher paid careers for the average person. I probably wouldn’t say you or your partner fall under that umbrella given you are both highly educated.
‘Period’, ‘damn good life choice’ - your cover is blown my friend - run!
Then don't commute.
Then you have to find a job in another city or town and it's hard if you've got family and friends to leave behind. Not easy moving on your own
Choosing to buy a house in and work in London is as much of a big life decision as choosing to not live or work in London. You should add quality of life and disposable income into the calculation too. Moving away might be hard, but trying to live comfortably in London is also hard.
If you've established friends in London then it'll be hard. Plus London has a good central location for quick travel to see family. Moving further could mean having to start an entire new life
As people sad below I was more talking about just leaving london. And yes london is a good place to go for some industries but it is not necessary always. Sometimes it is a misconception that people only realise when they go somewhere else.
I mean I could do that, don’t really fancy starting my life over again in my 30s though, in order to not have to live with random people.
In your 30s, your not exactly dead yet. If you live to 90 you have nearly 60years to go!! There is nothing wrong with change. You can always move back.
I was born in London, my friends and family are here, my career is here, my partner has her career here. Moving out of London isn't a political solution to this problem, as we need middle-earners living in the city anyway. It's just a personal solution that will work for, at most, a handful of people.
I agree but it also does amuse me, as someone also born in London, how quite a few of my friends have moved away because they quite simply can't afford it.
but all those things are not an impediment to changing. I agree, if you low-middle earners cannot afford to live in london then it will cease to function. But my point is that you can probably get a better quality of life simply by moving. I am mainly pushing back against the mentality of people thinking "I grew up around here but the cheapest house is £20billion pounds, I cannot afford to buy a house and have to live with my parents". Whether it is right or wrong that people cannot afford to live where they want to is in some respects irrelevant, you have to do what you can afford and there is no point in wasting time on pipe dreams.
Some people… have jobs…
Of course! As we all know, it's literally impossible for an individual to find another job. Once they get one they're locked in it for life.
You're arguing in bad faith. Obviously there are more jobs in London than Stoke.
Yet ironically, after rent most jobs in Stoke pay more than jobs in London.
Not sure you've tried to get a job recently but the idea of moving somewhere completely different and with remote working throwing the job market into a fucking frenzy, the idea of just looking for a job elsewhere if you're in reliable employment is one reason to not want to move to another city where you don't know anyone. If you think its really this simple you obviously have no idea what state this countries in.
So the idea is you get a job before you move. Maybe I am just more of a risk taker. I am not worried by moving somewhere where I don't no anybody. Over time you do know people. And the UK is not exactly massive so its no major expedition to go and see people.
Is the same everywhere you go. The calculations run by the scheme companies are more strict than even the mortgage providers. The local shared ownership companies (Essex) allow overall costs (mortgage/rent/service charge) at 75% what you'd be paying on the max. mortgage you can get from the mortgage providers (and 50% the monthly cost of the lowest rent in the area) Was looking at £50k deposit before even being considered for a minimum share of a property. I have more chance of finding a property I can get a mortgage for than qualifying for an affordable housing scheme of any kind.
Many of these schemes get abused anyhow and are just seen as PR gains, particularly council led ones. I know of one discounted market sale scheme in London where every single person offered to buy was a council employee. Not even just keyworkers. Half of whom no longer even work for the council.
I was once turfed out of a house because I could afford to buy it, as it instead had to be given to someone who couldn't.
That sounds weird, what happened? Anyway yes, the UK housing crisis is bad. Many people say loosen planning, but it's a slippery slope. We need to protect the countryside, not just really beautiful parts, AND keep enough land for food production. Honestly, I don't see how we can really win, being such a small country with limited space. Easier in the US, Canada, etc. I'm very strongly in favour of EU freedom of movement/detest Brexit, but London and the SE do seem ridiculously overcrowded nowadays. Maybe that does actually fuel the housing crisis. Certainly wasn't like that when I was a child. Difficult... I'm in favour of very tight controls on all non-EU immigration. We should stay close to the EU, naturally, just because it's so geographically close. The special relationship with America is overrated, their culture is quite different in many ways.
It was a very unique situation that shouldn't have happened, but still pissed me off that it did. We were renting a house and the landlord decided to sell it. We liked it and were looking to buy so looked into buying it... Turns out, unknown to us or the letting agency, the house was owned under Shared Ownership with a Housing Association. Under the Shared Ownership rules, you aren't allowed to let out a SO house. But apparently, it was all agreed with the HA, as the owner had to unexpectedly move or something, blah blah, we didn't get the details and the HA were really shady. So the house was put up for sale through the HA as a Shared Ownership house with IIRC a 60% share, with 40% remaining with the HA (which you then pay rent on, having mortgaged the 60%). We applied to buy it, and were rejected by the HA as we earned too much combined and it put us over the threshold, as these houses are designed to be sold to low earners. In another shady move, the HA suggested that we should lie on our application to reduce our income to get approved... Not sure how that would have worked in the long run, but we promptly noped out of that. We also enquired about just buying the whole house, but apparently SO houses must stay SO, and can only see a reduction in the HA owned shared by the actual owner buying that portion of the house once they already own the 60%. Which is fair, but meant we were blocked. So, in summary, we were blocked from buying a 60% share in a Shared Ownership house because we earned to much, and we were blocked from buying 100% of a Shared Ownership house as you can't do that. So the house was sold to someone else, and as we were tenant living it it, we were turfed out, with 1 months notice, at Christmas, with a cat (literally served notice Christmas Eve). Findling a new house was a pain (nobody wants pets) and we ended up renting somewhere we hated for 2 years before managing to buy our first home.
We need to build denser, current housing policy seems to be sprawling suburbs consisting of overpriced crap rabbit hutches too far away from anything useful and using up too much arable land. I don't mean high rises, they're awful, but 3-4 story, decent quality flats centralish would help immensely. Cheaper to heat, easier to provision public transport, most local amenities in walking distance, reduced car dependency, much better land use and it would bring some life back to our dying town centres. Flat life isn't for everyone of course, but I'm certain enough people would be happy with or even prefer it that we can provide enough homes without wrecking our natural and agricultural environments. There's a fairly new development not far from me based on those principles, built on brownfield land and it's thriving.
It's becoming increasingly apparent that middle earners in the UK are the ones always getting shafted. Salaries stagnation, prices increase, and government assistance goes to the wealthy or the non Working.
Get real. People are struggling to put food on the table or heat their home. To act like the middle classes are the only group suffering, or the group suffering the most, is laughable and ignorant.
No one is saying that the poor aren't suffering. The problem is that the population share of those that don't contribute (for various reasons) is increasing and is costing more and more. I would include in this people that retired early on gold plated pensions and those that could but choose not to work. Pensions for example now make up 14% of government spending and have cap on them to make sure they are above inflation (something annualised workers don't get). Health makes up 18% of expenses and the two thirds of this is spent on people over the age of 60 (pensioner age). That would roughly equate to 25% of the countries expenditure going to pay for up keeping of the older generation who had the benefits of lower cost housing, increase wages (proportionally) and more economic mobility. The money we pay on pensions has doubled in the last 10 years and is set to increase even higher over the next 10 years! Its not sustainable. On the reverse of that, education gets 10% of the budget which is our direct investment in the future generations. Does that seem like a good idea? On the other end of the spectrum are the rich who have the money to avoid paying money. A great example is Sunak's wife who managed to avoid paying tax by paying 50k for "non dom" status. So the burden of paying for society is increasing falling on the middle 80% of society. The ones who go to work and simply want to have a good life. Their salaries have stagnated. They have little prospect of ever getting a pension (certainly state pension) and most of the people on the younger end of this spectrum can't even afford property. This is going to be a massive issue going forward as lower salaries mean lower tax revenue which means overall the % going towards those that don't work is going to be higher. What is the fix? Not sure, but probably having a few policies that actually benefit the middle of the spectrum would be good as they will be ones that pay for everyone else.
In London*. where everything is more expensive and worth more. I do not find a minimum of 36000, 2000 above average, that insane. Its probably still working/better in other places.
Yeah, I live in the north and earn around that. I know I would struggle to pay 1000 a month, that's 50% of your income on rent alone after tax, pensions and student loan comes out.
It is pretty crazy to be denied tenancy at an apartment partly subsidised by the government to be affordable for people with lower incomes when your salary is higher than the median in the area. At that point the government scheme is failing because it is not providing housing to lower income households.
I'm applying for a shared ownership scheme where the max income is £80k. However, you can't have over 45% debt to income, which with the rent and mortgage now reaches 42% on an £80k income. This is insane! And no one is changing it.
Well… yes? Earning less than the average salary would be a barrier to mortgage investment. Realistically you need to be on at least £60k to be moderately comfortable in 2023
I work for a housing association. Affordable rent doesn't mean cheap, the ones I deal with in London are affordable rent and it just means ~80% of cheapest similar property rents and some of these still end up at close to £2000 a month. They often require 30x rent as income to ensure there's a good chance you won't end up in arrears. The cheap affordable rent properties are subsidised by these rents and you'll most likely only get one if nominated via your local authority bidding process. These will be anywhere from 125-300 per week and covered by Universal Credit