Even though I live in London and you live where you do I think I can safely say this is a topic that is relatable in the first world.
Via
I thought house prices and the topic would have quietened down after the economic turmoil of 2007.
But the subjects of home ownership and house prices increases are still being discussed at dinner parties across the globe.
The U.K., Australia, and some areas of North America
for various economic reasons are going through a
revived and ebullient housing market.
Despite the recent economic crisis, house prices have not crashed and have depending on where you live maintained its price or increased in value.
There are many theories behind this but the main simplistic reason seems to be financial security in bricks and mortar coupled with low interest rates.
This may seem like it is a financial boon but to be frank all
I feel is a collective social anxiety.
I am not just discussing this topic with friends but am now overhearing conversations in cafes and on public transport.
Alain De Botton discussed general status anxiety but this housing anxiety is something slightly different that people who have no intention of impressing anyone nor social climbers are experiencing.
People who already own homes are viscerally stressed thinking that they would have gone crazy if they needed to buy a home now.
The common statement by home owners is that most could never afford their homes if they had to purchase it now.
People who don't have homes are obviously stressed as they have to endure the rigmarole of getting the deposit and mortgage but also the added burden of the bidding process. They also don't have the security of being able to settle down in a rented flat as landlords have the right to exercise their right to sell or rent to someone else at a higher price.
Everyone is stressed about house prices.
There seems to be no true winners but only losers in this area.
The phenomenon that is not gaining any media traction right now because it clashes with the journalistic sexy frenzy of high house prices is that rents in London haven't been this low in years.
Due to the glut of properties being bought for investment,
there is more stock for renters than ever before.
If you rent in London,
I would strongly suggest you renegotiate right now!
Of course, this fluctuates and ultimately the landlord can kick you out upon whim so there is no security for the tenant after 6 months.
If you own a house and it goes up in price then you are simply hedged against inflation unless you own a home that outpaces the house price growth index which unless you are a hedge fund will rarely profit from anyway.
Most homeowners with children subsequently worry how their children will ever afford homes in the future.
Lawyer buys $710,000 city unit to set up son, 5, on ground floor of property market - Via CarolinCarins
Carol mentioned this article where a man in Sydney bought
their 5 year old a flat for the future.
This sort of practice used to be done only among the truly rich.
Now it seems most middle class families who can afford to do it.
Even when you own a nice home,
you are then worried about the homes around your own.
Did you hear Mark Zuckerberg spent $20 million to buy up the homes around his to protect his own?
It's like no one ever truly feels safe.
If you don't own a home, then you feel like you will never catch up and all of a sudden GDP figures, inflation indexes, and interest rates matter to you as if you were a commodity trader on Wall Street.
But for some who don't earn enough,
the dream of owning a home is so extraordinary and out of reach that it is starting to impact on people's lives.
People are reluctant to get married, to have children, and move far away from their families simply to be able to have the pleasure to paint their walls as they wish and not having the fear of getting kicked out.
In London, things have gotten so out of hand
that house shares have evolved to a new niche.
I am sure that most of you have heard of renting out sofas in high density cities like San Francisco and New York.
But in London people not only do that but
they have started renting half of beds.
Yes, you read that right.
As there is a huge subculture of illegal immigrants in the U.K., people now get a queen or king size bed or even two beds to a room and they pay rent to sleep on half the bed.
When I first arrived in London,
you could have theoretically sold a few things on eBay and with the proceeds bought a home in Brixton or Hackney.
Nowadays you need to be a trustafarian or a 6 figure earning tax payer to be eligible for a mortgage in either area.
House prices seem to have changed
the names of gentrified areas as well.
Streatham is now referred to as St. Reatham
Battersea is sometimes pronounced Batter - sea - ah.
My favorite is Elephant and Castle.
Can you guess what they jokingly call it?
Chateau d'elephant.
I was reading Caitlin Moran on the Times the other week
and she wrote about the invisible gates on the city of London
due to high house prices.
But actually Fran Lebowitz discussed this phenomenon of New York being accidentally elitist a few years ago in her
documentary Public Speaking by Martin Scorsese.
(Click on link to view http://www.youtube.com/watch?v=_nHmgJn-hLo)
She said New York was a cool city that groomed talent and
there was creative stimulus everywhere.
I may not be as old as her but even I remember a New York with a varied population. The building I lived in the Upper West Side was an eclectic mix of graduate students, rent control tenants, middle management but now the building is purely tenanted by yuppies.
The city was a medley of dancers, professors, artists, and bankers.
But what struggling artist can afford to pay rent in Manhattan anymore?
Don't get me wrong, society needs white collar workers but we also need the risk takers and black swans to shift social paradigms.
Right now cities like Paris, London, and New York may be the headquarters of publishing, fashion, and other "trend-setting" industries but they rarely get their ideas locally anymore.
For example, trend spotters roam the streets of Berlin where rents are one of the lowest in western Europe and artists can afford a little shop front to show off and sell their wares.
Manchester and Bristol have discreet satellite art gallery outposts to spot talent who are still squatting in a derelict warehouse creating art that may eventually be in the Turner Prize.
Don't forget Banksy is a Bristol boy.
This is not something that any government or politician
can improve or fix but I do think that in the game of increasing house prices no one should be smug.
I thought house prices and the topic would have quietened down after the economic turmoil of 2007.
But the subjects of home ownership and house prices increases are still being discussed at dinner parties across the globe.
The U.K., Australia, and some areas of North America
for various economic reasons are going through a
revived and ebullient housing market.
Despite the recent economic crisis, house prices have not crashed and have depending on where you live maintained its price or increased in value.
 |
| Via |
There are many theories behind this but the main simplistic reason seems to be financial security in bricks and mortar coupled with low interest rates.
 |
| One of the many theories behind house price increases via |
This may seem like it is a financial boon but to be frank all
I feel is a collective social anxiety.
I am not just discussing this topic with friends but am now overhearing conversations in cafes and on public transport.
 |
| Via |
Alain De Botton discussed general status anxiety but this housing anxiety is something slightly different that people who have no intention of impressing anyone nor social climbers are experiencing.
People who already own homes are viscerally stressed thinking that they would have gone crazy if they needed to buy a home now.
The common statement by home owners is that most could never afford their homes if they had to purchase it now.
People who don't have homes are obviously stressed as they have to endure the rigmarole of getting the deposit and mortgage but also the added burden of the bidding process. They also don't have the security of being able to settle down in a rented flat as landlords have the right to exercise their right to sell or rent to someone else at a higher price.
Everyone is stressed about house prices.
There seems to be no true winners but only losers in this area.
The phenomenon that is not gaining any media traction right now because it clashes with the journalistic sexy frenzy of high house prices is that rents in London haven't been this low in years.
Due to the glut of properties being bought for investment,
there is more stock for renters than ever before.
If you rent in London,
I would strongly suggest you renegotiate right now!
Of course, this fluctuates and ultimately the landlord can kick you out upon whim so there is no security for the tenant after 6 months.
.png) |
| Via |
If you own a house and it goes up in price then you are simply hedged against inflation unless you own a home that outpaces the house price growth index which unless you are a hedge fund will rarely profit from anyway.
Most homeowners with children subsequently worry how their children will ever afford homes in the future.
Lawyer buys $710,000 city unit to set up son, 5, on ground floor of property market - Via CarolinCarins
their 5 year old a flat for the future.
This sort of practice used to be done only among the truly rich.
Now it seems most middle class families who can afford to do it.
Even when you own a nice home,
you are then worried about the homes around your own.
Did you hear Mark Zuckerberg spent $20 million to buy up the homes around his to protect his own?
It's like no one ever truly feels safe.
If you don't own a home, then you feel like you will never catch up and all of a sudden GDP figures, inflation indexes, and interest rates matter to you as if you were a commodity trader on Wall Street.
 |
| Via |
the dream of owning a home is so extraordinary and out of reach that it is starting to impact on people's lives.
People are reluctant to get married, to have children, and move far away from their families simply to be able to have the pleasure to paint their walls as they wish and not having the fear of getting kicked out.
In London, things have gotten so out of hand
that house shares have evolved to a new niche.
I am sure that most of you have heard of renting out sofas in high density cities like San Francisco and New York.
But in London people not only do that but
they have started renting half of beds.
Yes, you read that right.
As there is a huge subculture of illegal immigrants in the U.K., people now get a queen or king size bed or even two beds to a room and they pay rent to sleep on half the bed.
When I first arrived in London,
you could have theoretically sold a few things on eBay and with the proceeds bought a home in Brixton or Hackney.
Hackney
Average house price
£428,333
£428,333
| Detached | £454,000 |
| Semi-detached | £808,192 |
| Terrace | £641,741 |
| Flat | £377,603 |
Annual change in house price
+14.7%
+14.7%
Quarterly change
+8.7%
+8.7%
Total number of sales: 608 Via the bbc
House prices seem to have changed
the names of gentrified areas as well.
Streatham is now referred to as St. Reatham
Battersea is sometimes pronounced Batter - sea - ah.
My favorite is Elephant and Castle.
Can you guess what they jokingly call it?
 |
| Via |
I was reading Caitlin Moran on the Times the other week
and she wrote about the invisible gates on the city of London
due to high house prices.
But actually Fran Lebowitz discussed this phenomenon of New York being accidentally elitist a few years ago in her
documentary Public Speaking by Martin Scorsese.
(Click on link to view http://www.youtube.com/watch?v=_nHmgJn-hLo)
She said New York was a cool city that groomed talent and
there was creative stimulus everywhere.
I may not be as old as her but even I remember a New York with a varied population. The building I lived in the Upper West Side was an eclectic mix of graduate students, rent control tenants, middle management but now the building is purely tenanted by yuppies.
The city was a medley of dancers, professors, artists, and bankers.
But what struggling artist can afford to pay rent in Manhattan anymore?
Don't get me wrong, society needs white collar workers but we also need the risk takers and black swans to shift social paradigms.
Right now cities like Paris, London, and New York may be the headquarters of publishing, fashion, and other "trend-setting" industries but they rarely get their ideas locally anymore.
For example, trend spotters roam the streets of Berlin where rents are one of the lowest in western Europe and artists can afford a little shop front to show off and sell their wares.
Manchester and Bristol have discreet satellite art gallery outposts to spot talent who are still squatting in a derelict warehouse creating art that may eventually be in the Turner Prize.
Don't forget Banksy is a Bristol boy.
This is not something that any government or politician
can improve or fix but I do think that in the game of increasing house prices no one should be smug.
Should we be saying 'Ton de Brix', 'End de Mille', 'Monde Riche', 'Toute-d'ing', 'Wick de Chis', 'Barnette'?
ReplyDeleteOsons !
Love it! I am surprised monde riche hasn't caught on earlier tho... I prefer Haute Barnette merci beaucoup a vous. Delboy now lives in peckjambon dont you know?
DeleteHahaha! Haute Barnette!
DeleteHaute Barnette...naturellement!
Delete'l'enfant de Castile' - the child of Castile (Spain) is of course what 'Chateau d'elephant' is bastardised from...no matter what wikipedia is getting away with altering historically, les enculés! A pox on wikiputainpedia, bordel de merde! Most of Angleterre was French, (and we spoke it, couramment), at least as far as Guyzance!
Mme Curator, clope au bec, avec mes deux baguettes sous le bras. Voilà.
Yes of course so naturellement but was is really encule( excuse my illterate spelling without the proper ticks over e's) but is when people who can't speak French insist on calling restaurants - restauraungs, does my tete in.
DeleteI loved this post beyond words. As a mid-late 20 something I am definitely feeling this anxiety of "not owning a home"....I'm on a good wage but even then anything within 40km of the city is pretty much out of reach unless I buy an apartment (I despise apartment living having done it for a few years now). It's do depressing and there is competition among friend's and colleague of my age as to "who has a property and who doesn't"....awful!!!
ReplyDeletePs. I'm in Melbourne...not as bad as Sydney or probably even London but still crazy!
Deleteas a Melburnian I know it may not be "as bad" but it is pretty horrific. I couldn't believe the prices had gone up. again...when i visited a few years ago and mediocre houses in Bentleigh were a million. Something just isn't right but unfortunately I don't know if it will end up as a tulip bulb bubble because now everyone and the increasing population wants a home. Even a flat! I think long gone are the days of a quarter acre unless you inherit or make a bomb. It is just a new way of adjusting to that fact...But Anne- forget about that competition bc it's all nonsense. Once you own a home there are so many costs involved and then one is it tied to it with all its upkeep and body corporate fees etc. What I suggest to people who live in an expensive city is to rent as cheap as you can but then buy another home in a cheaper city and rent it out so that you are heged against inflation because a lot of time price growth is just that. Does that make sense? Otherwise it seems just as you save enough the prices have jumped again...
DeleteOh don't get me started on the Bentleigh millionaires!!! Cannot believe the prices there, in fact any where between about 15km and 35km of the city has sky rocketed. I love your common sense advice on the competition thing because it's doing my head in a little (more with the competitive colleagues than my actual friends) but it seems to be the gloating point of the moment to say you bought a house/apartment and feeling a little left behind!!! I will consider your investment strategy. Very interesting idea!!
DeleteIf you are serious about getting on the housing ladder, just focus on your finances. There were always be people so much better and so much worse off so I say this sincerely when I say don't waste any energy on that sort of competition. Truly. You seem like a level headed girl so just concentrate on your own aim. I think a parallel investment vehicle is the way to go but not in stock as timing is never right and that should only be done with "extra money". Try not to invest in a two bed bc those are the lowest returns. Think maybe a small three bedroom house in Bendigo/Geelong/Mildura or a mortgageable studio in the city. Something that is always in demand and easily rentable. I wish you luck and let us know how you go x
DeleteIt's so depressing. I can't help but feel that investors are to blame in Australia due to the tax breaks. Plus banks lending out obscene amounts of money to people means that prices are driven up - whomever borrows the most wins the property. Plus allowing foreign ownership (if you spend over a certain amount of money buying property you get a visa to Australia. All the expensive houses in Melbourne or Sydney are now marketed in Asia heavily, and often are bought by Asian investors who want their kids to go to school and Uni here). I was reading about Gen Z's who are sharing rooms in Sydney to save on rent. Apparently it's quite the phenomenon as they try to save up to buy a property of their own.
ReplyDeleteThose graphs were also depressing - Australia was on the top....
I remember when I lived in London the one bed flat I rented in West Kensington was on the market for 120,000 pounds, and was not sold as everyone thought it wasn't good value for money xx
I agree, Heidi, it's investors and banks driving up prices here.
DeleteIt's so depressing :-(
My kids will never be able to afford to buy a house here, if they choose to stay.
Our old flat in ?Bloomsbury was for sale for £210k when we moved out in 1999. We're still kicking ourselves for not buying it.... It was such a bargain in retrospect.
Cor blimey Ruth, that's more or less the price per square foot now!
DeleteYep it is depressing...The same stuff happens here - all the new build flats get sold in Asia but they are getting ripped off as well because there is such a premium . Plus Australia does do that visa incentive causes issue but who wouldn't want to get a visa in Australia? But with Asia getting richer and richer I dont know see an end to this in the near future plus there is a baby boom at the moment so there is a shortage of houses!
DeleteHow times have changed - 120K would get you a double garage there now!! xx
Such a timely post, Naomi. The situation is just terrible, really. Houses here in Sydney are so inflated in price, and very few people can afford to buy them. I read somewhere that over 65% of purchases here are to investors, which is no good at all for society.
ReplyDeleteOur house seemed like a huge expense when we bought it 11 years ago, and yet now it has apparently almost doubled in value. There is no way it's 'worth' over $1 million - it's just a falling down Edwardian house on a tiny plot of land, and yet the stupid inflated market just keeps going up and up.
Very sad state of affairs indeed.
Ruth - I wont go there because we could all play that we shoulda bought game...But yes that bloomsbury flat seems like it would have been rather nice indeed. Sydney is just crazy and I have to say that is probably why Sydneysiders are the most stressed as well! You say it is a falling down Edwardian and yet it is a dream to most!
DeleteMmmmm.....I think I don't get out enough, or the conversations are different in my part of town.However, I know via the news media that we have a housing shortage and an affordable housing shortage and high rents. The situation is particularly bad in Christchurch because 10,000 homes were lost to the earthquakes as well as huge tracts of land that once would have been considered suitable for housing. I wouldn't want to pay the current super high rents so am very glad to own my own home, despite the maintenance costs and high rates to be paid. But in all my years, I don't remember a time when it was ever easy for the 'average' person to buy a home. Provision of good quality, affordable housing, either owned or rented, is still an issue our economies/societies struggle with. What a pity.
ReplyDeleteyes you have your own unique housing issues in Christchurch...But I do remember when one could buy a house rather easily though. Melbourne had houses less than a 100K in the mid 90's. They weren't fashionable but it was very doable. but now those unfashionable areas have gone up exponentially. I think that is the crazy thing. Bad areas in London that no one would touch with a barge pole are out of reach for even mid level city workers!
DeleteI recall my friends doing the compulsory 12 months London working holiday in the 80s, all "hot bedding". They were nurses so they would share a double bed amongst three, it all worked out as long as they were on different shifts.
ReplyDeleteIs that the official term? Yes well hotbedding and rent a spare sleeping bag against the sofa is still big here. I dare not imagine how refugees sleep in London...
DeleteIt's the greed that gets me.
ReplyDeleteBut really what people need is affordable and secure housing.
whether they own or rent.
I have had a mortgage before. I now have a deposit for a mortgage, and a potential to earn well. And a partner (to buy a house with). I try not to worry too much.
Greed is only a part of it - I think people are just scrambling for one of our basic necessities which is lodging. Affordable housing just seems like an oxymoron. You are lucky you are in your position but not every one has well to do parents or a super duper job. You are in the minority. I worry about postmen and nurses who provide a huge service and yet where will they live? It is just tough for a lot of people out there...
DeleteInteresting - where I live it is similar, only for completely different reasons - everyone is moving from the country towns, which are dying and hemorrhaging people to our three cities. Of course, you need to know that our largest city only has 120,000 people! Now I have house anxiety, too, about London!
ReplyDeleteThat is a small population indeed! But that must lead to such an imbalance as well. What use is affordable housing if there are no jobs to support it...
DeleteIt's totally ridiculous where I live as well...but it always has been. Is there anyone more obsessed with owning their own property than the English? You have resurrected memories of my younger days when I was scampering around the mean streets of Hackney. I couldn't get out of it fast enough.
ReplyDeleteAussies rank up there with the English for sure! Except they also have outdoor space as a given. Ah Hackney - those streets are now gilded Sulky! Albert Square is now no longer for market stall vendors...
DeleteWe are quite insulated, having three large government employers, we did not feel the same effects of the recession and the recovery. New housing, thankfully for us, is in need because the government regulations on the banks in the US all but stopped development for several years, just wouldn't give out loans. We muddled through and are now slowly seeing an increase in business. However, it still amazes me that most people do not have to come to the table with hardly any money. They mortgage everything.
ReplyDeleteYes this loan and mortgage stuff is such an odd thing. Used well is wonderful but now it seems people have a mortgage plus student debt and credit card debt. Dare i say i think for some just renting would suffice but there seems to be this primal nesting need...In mainland Europe, they tend to rent more than in the UK but that trend is changing due to the population shift. But you are very lucky to have a constant rather than huge fluctuations as it is here.
DeleteWe are a rather transient society and renting, for most, would be better. Our typical home owner is lucky to be in their house three to four years. Hard to get ahead of the mortgage with that length of time. We build mid price homes and for many it is their "starter" home. Our first home the previous lady had died in it, shag rug, avocado appliances, kind of a dump. Now, mid twenty year olds get a $275,000 home.
DeleteFunny - the problem here is that there aren't enough starter homes. There isn't enough land to begin with. Also at times I do think there is such a divide between what people can afford and what people want. I see homes that aren't great and in the past people have passed them up because they were ugly or some other reason and now those same ugly unfashionable houses are out of their league! So depending on where you are I don't know if many people can afford to be choosy. But 275K for a starter home in your mid twenties is still a lot of responsibility nevertheless!
DeleteWell, as usual, you put it all down so succinctly...all I have to offer is a "yes agree to all"
ReplyDeleteWe had to move out of London, as with a baby throwing a big old spanner in the works, we needed a bigger place and we did not have £800,000 in the bank for a 3 bed semi....and 4 years on... I would now not be able to afford my current house! Crazy xxx
Yes babies change things hugely! But you are lucky to have bought when you did. Funny we wouldn't be able to buy our house right now either!!xx
DeleteOne of my parents' biggest regret was not buying a property that came up for sale 30 years ago - it's tripled in price now but at the time, although they could have afforded it they were just starting out and no way could they have envisaged what would happen 25 years later. 6 years ago I bought a new build flat because I didn't want to have the same regret as my parents, but low and behold, my regret is even bigger - I'm sure it is now in negative equity (i don't even want to check) and the service charge has sky rocketed. I'm desperate to sell it, but it's not the market to sell. Fortunately I have a tenant who is very reliable with paying her rent, but if I could go back 6 years knowing what I know now, I wouldn't have touched it with a bargepole. The house I'm in now is not where I want to live out my years, so I am saving for a new one, but............not holding my breath. Sad times! xx
ReplyDeleteTiming is crucial. Sorry to hear about that but I would get it valued anyway because with rental properties you should get a valuation letter for future tax references anyway. You may be surprised it has regained in value lately. As I like to say - it ain't over baby so don't think it is a bad deal because these cycles are just that and you just bought just before 2007. You might be selling next year with all the movement in the market and finally moving into the home of your choosing! Good luck with it though xx
DeleteVery interesting post, as usual!
ReplyDeleteWe live in Switzerland where renting is the norm. Apartments are well maintained and rents are reasonable. Even here though our friends are buying and it does give me some anxiety, that and knowing how many of my friends back in Canada and the US are buying. If/when we move back, I'd want to try to buy in part because the rental stock is so bad and tenant protections are poor.
It is certainly an anxiety producing question at this moment in history. I think it's also just about havig some kind of flag that signals security in insecure times, even if it is false security.
I'm content renting, especially as we keep moving around the world, but I'd like to own by retirement. Even here, my friend had some very elderly neighbours who were nearly kicked out of their rental because it was supposed to be a subsidized rental for young families. I think that they were allowed to stay in the end.
Yes I do wonder if the island mentality is something to do with this urge for owning. Also I notice English speaking countries like to own rather than rent. In Germany the shift is also turning with buying on the increase. Like you mentioned there seems to be no guarantee in social welfare anymore either. There is also talk that there is too much "hogging" of single people taking houses that young families live in. Welfare housing is changing and I think there is a reverse upward effect about things like that.
DeleteI think that for reasons of stability it is good to buy because I have had friends happy to rent but they end up very happy in the area and home to ultimately get kicked out because the owner wants to sell etc. If anything I want to downsize as much as I love my home - there is a lot of space we don't use and sometimes I think it is a bit of a waste and only ends up being a storage room!
Interesting. When we sold our two bed basement flat in London (Notting Hill, but still) I thought it was crazy prices. Now my sisters tells me her two bed place in Peckham. London is now worth $700,000. Now of course that creates mucho anxiety that we did not keep our flat. When will the bubble burst. People in London will not believe this but the prices in Oakland where we live (murder capital of the US) are totally crazy too
ReplyDeleteWell Brixton and Hackney weren't exactly the most salubrious but old pretensions are no longer applicable. Yes the house prices in Peckjambon are around there and climbing as we speak. There is all this mised opportunity and sense of failure for some and unbearable smugness from others but your area is crazy bc ultimately it has jobs..
DeleteI always loved Brixton, worked on Right To Buys for the council there (for my sins) when I first got to London, 25 years ago, I'm sure its transformed now!
DeleteCSW ~ you point out so many social issues related to home ownership. I lost my home in the GFC, and will probably now retire without owning my own home me again. And I suppose I could stress about that, but to be honest I stressed plenty trying to hold on to my home and the mortgage I had and on one level not having to contend with all the hidden costs of home ownership, the ups and downs of property markets, the no win attitude of banks, has been a relief ~ for now. As you point out, this is a first world problem. Thank you for mention and cross post.
ReplyDeleteYes owning a home definitely has its own stresses not many people mention - not many acknowledge the maintenance fees and that the only time you can profit on a home rising is when you seel but then where does one live? I think there are positive aspects to both owning and renting and I think the media has to highlight both of them rather than pretending that owning a home is the only option....
DeleteI've been thinking about this so much these last weeks, we've been living in our house 8 years, the longest I have ever lived anywhere, and we have our mortgage nearly paid off. However I have anxiety about it I did not have before, as soon as that is paid in 15 months I want the mortgage finished on our office property, but really it's a stupid stress as that interest is a complete tax write-off for my business. Why the insecurity I wonder? Well maybe it's zeitgeist. Another factor could be our Rascals, we have two in Uni and are paying their education but now we're thinking about "how are they ever going to own a home" and talking to our accountant about the best way to help them... unheard of in my generation among my friends, and I'm 43 and from an upper-middle class background, my parents didn't pay for Uni and would have laughed at the thought of helping me buy a home, what the heck has happened and how will it end?
ReplyDeleteSuper-interesting post Naomi, love the way you write about things.
Well yes - this is precisely that. Even in your position it seems that people still worry. It is crazy isn't it? Because as you say - you are fine but what about your children? And what would have been classed as super comfortable a decade ago is now still getting by and having financial worries of sorts even if it may not be a pressing economic matter. We have definitely entered a new age Dani...Funny though because I also have lived in my house for 8 years and it is the longest I have lived anywhere! But I would like to move on to somewhere new...Oh and thanks Dani - very kind of you to say x
DeleteHi Naomi, enjoyed this post, love your research and thoughts. I'm lucky that my dad helped me with about 60% of the down payment for a very modest one-bedroom condo in an OK part of town while I was in my last months of college. The next property, which I still own, was what some (most?) would consider a crazy idea. It's once again a one-bedroom condo but with no parking! For the same price, I could have -- coulda -- had a two-bedroom house with a garage maybe just five miles away. But here's the kicker, think that house woulda ;) rode the ups and downs while the small condo held and steadily increased in value (it would now sell for a ridiculous price and I often get "if you ever want to sell" notes stuck on the door). It's half a block from the beach/ocean in one of the most exclusive seaside cities in Southern California. And one of the best things is I bought it on a lease-to-own deal so in essence saved up for the downpayment while living there ... do those arrangements still happen? I had just learned about lease to own the week from a real estate friend when I found the deal by chance. Talk about somebody looking out for me ...
ReplyDeleteHa! I shoulda done that too!! I think you were very lucky! I also think that one bedders are the way to go. With people,not marrying retiring divorcing etc one bedders are always needed...but this lease to own must be an American thing bc they don't do that here or in Australia nor Asia. I would love something like that but I suppose in the states they are a lot more creative about purchasing. I noticed that with cars over there as well. There isn't an extensive system of leasing here. But here is to your ever growing empire!! :)
DeleteIt's not just about getting into the housing market, it's the house maintenance as well. It's raining here, and in the last 24 hours, an entire bucket has been filled from a leak in our ceiling. Back to my diet of noodles and chips.
ReplyDeleteYes house maintenance never gets talked about!!! There is a new trend of people losing homes because they can't afford the service charges...I wish there was roofie scotchtape for you!
Delete"Despite the recent economic crisis, house prices have not crashed and have depending on where you live maintained its price or increased in value." You can say that again!!! It's crazy, you can actually buy cheaper apartments in Manhattan than in Ljubljana (Slovenia's capita) - and that's no exaggeration, it's a fact, it was all over the news here a few years ago!!! But of course nothing happened or changed since then, at least not for the better. And people live with their parents till they're 35, that's the norm here. Shoot me.
ReplyDeleteYes I heard about this - Yes they call that trend the boomerang generation because they go and then they all go back to the ol' home! Except house rules aren't so cute after 30...
DeleteThis is very timely - the whole pressure to own property is a constant source of stress. My husband and I bought our current house about 7 years ago and since then we've watched the prices of the houses in our neighbourhood skyrocket. However, it is little comfort, because even if the house is worth more, you can't exactly eat bricks & mortar. And the mortgage is a constant worry. Thanks for such a thoughtful post.
ReplyDeleteWell you bring up a great point - prices go up and so you are hedge in but unless you sell how can you profit? unless you uproot or have another investment house. You still need to live somewhere right? Mortgages are a worry because interest rates can go up for sure but maybe you could profit from it by downsizing or going to a neighborhood which is better value and downsize the mortgage as well? But yes win or lose it is an issue...
Delete