Do you think That when having both parents working became the norm, that’s why house prices are insanely high

[Lardlizard]

And now the majority of families have no real choice but for both parents to work

I guess thatcher coming up with the right to buy has also massively not helped as now there’s seriously not enough affordable housing

Elderly carE is so expensive that a lot of homeowners all the Money tied up in their house will end up paying for their care

So really doesn’t seem to have benefited us a lot does it

It's the other way around. Mortgages used to be capped at about 2.5 x salary of main earner. This kept house prices affordable. Thatcher's changes to the banking and building society arrangements meant that they were allowed to lend more money, allowing house prices to rise to their current value. Now both partners HAVE to work to afford a house.

Interest rates are now much lower, so there's less incentive to save.

(It is of course, much more complicated than just those two things, though!)

Increasing the lending multiple and counting both salaries has almost certainly contributed to increasing house prices. After all, most people are limited by the amount that they can borrow. Restrict the amount someone can borrow and prices can't rise as fast, because fewer people can pay the prices.

In a way it would have been better to always base mortgages on one salary, whichever is highest if a couple is buying together. Nothing to do with not recognising the woman's income and not stopping a single woman buying on her own, but reducing the consequences of and dependency on two salaries to buy a property.

Makes it easier for people buying on their own as they're not competing against two earner couples, same for families with a SAHP or when income is lost or reduced due to illness or job loss etc.

I don't necessarily think RTB is the problem here- it can be a really great thing. it's the fact that the money raised from sales of council houses has never been funnelled back in to social/affordable housing. That should have been mandatory from the start. It's a crying shame that more isn't built with the proceeds. If you think about it, its actually a pretty good business model for getting people to own their own homes. It's just been totally mismanaged.

I do think people on their own are being priced out. That's why you now have so much shared ownership springing up. That isn't the wonderful solution it's been portrayed as either. I know someone who bought a place under the scheme, she now has DC and needs more room but she can't sell at the moment due to dangerous cladding on her flat. I'm lucky enough to be in nice social housing and I'm staying put. I'm in my 50's now and single and it suits my circumstances to have an affordable rent and no worries on building maintenance etc. And if I were to become too ill to work I can claim housing benefit.

I think that sadly a lot of people in the current economic crisis are realising that a home doesn't belong to you until the mortgage is paid in full. But society has been set up now that the 2 options generally are buy or pay extortionate rent. So people buy and have to hope they can keep up the repayments. But it's a huge pressure I think. I don't really agree with the UK housing model as a whole. The set up in many European countries with affordable, long term rental properties is much better imo.

Yes I fully agree on how too much has been made as avalible for people to borrow
It was much more simpler when it was something like x2.5 times your yearly income

Do you think there’s anyway to get a hold it it now or is it truely too late

I certainly think people in tented should have a lot more certain only like longer leases and more rights to be able to decorate etc
Longer noticed periods
Stop ripping people off with Ridiculous fees like 100 quid fee to sign an email

And I do agree money made form
Rtb should have been ploughed striaght back into more social
Housing
Then we wouldn’t have this housing crisis
We have now

My Mum was working full time when she and my Dad bought their first house in the 60s. Her income could not be considered for mortgage purposes so all done on his salary. She had to leave work when pregnant with her her first as that was the done thing. But she started working again p/t When we were at school and actually carried on well after my Dad retired. So, yes, I think you are probably right, If mortgages were only based on single salaries there was a limit on how much people could afford.

No. House prices increased the way they did, quadrupling in 3 short years in the early 00s, right at the same time that buy-to-let was encouraged by the government and there was a sudden large influx of immigration. Food prices went up a little later. It’s very common for people to blame women for working, but round my way women had always worked and prices went up and down regardless. It’s extra demand on limited supply that pushes prices up generally, and that’s what was supplied.

Yes. House prices return to affordability. The fact is most buyers are couples and that’s now the baseline.

But as previous posters have said there are other issues propping the market up at an unaffordable level. I wonder if there will be a sudden release of high-end equity as baby-boomers go into sheltered housing though. It’ll be a while before that happens - my parents are silent generation and the only family member in a retirement setting is the generation above them

House prices are high where demand outstrips supply. Since 2010 lending has been capped at 4.5 times salary for 85% of offers lenders make, yet that hasn’t resulted in lower demand and thus a fall in house prices.

Elderly care should be expensive - more expensive, if we want care workers to receive a fair wage - and I’ve never understood why older people should expect not to have to sell their home when they move into another one, which is what they’re doing when they move into a residential home. I can’t decide I want to move house but keep the one I live in currently as an inheritance for my relatives, and ask taxpayers to pay the mortgage for my next one, so why should there be an expectation taxpayers do that for the care home fees of people who can afford to pay them.

Don't underestimate the impact of foreign investors on the housing market.

New build London flats, that might otherwise be lived in by a young couple, or first time buyers, are instead being marketed in the far east and sold, prior to being built, to foreign investors, who want to use the flats as a safe place to invest their money. Having bought the flats they often don't rent them out, preferring to leave them empty and so pristine "as new." The ripple out effect is tremendous. It may be a London problem, but the consequences ripple out all across the housing market.

Here's a quote from a guardian article about it "One new apartment complex in Southwark, on the site of the former Heygate council estate, was 100% bought up by foreign investors. All 51 of the apartments in South Gardens in the Elephant and Castle area were sold abroad."
www.theguardian.com/society/2017/jun/13/foreign-investors-snapping-up-london-homes-suitable-for-first-time-buyers

We have no laws to stop this.

“House prices return to affordability”. Affordability for whom though? Come to think of it - I don’t know about this one, but about the same time banking practices were ‘liberalised’, giving London’s financial market the huge influence it has today. All that lovely foreign investment, aka dirty Russian money, would have started coming in round about then, totally unconnected to and unearned by the local economy. We know now that there’s a lot of it being whitewashed in the UK. That would have had an upward affect too, if I’m right.

Cross Polyethyl!

I'm 64, I had my baby at 24, 1981. Women of my generation generally returned to work, where as my sister in law is 72 she didn't return to work and nor did many of her friends

I love her dearly but it gives me the rage that she got pension at 60 and I'm waiting until 66

The money laundering through the London property market (and also Manchester's I believe) does have a direct impact on house prices rippling out across the country.

In Elephant and Castle a council house tower block containing about a thousand flats was demolished and the site sold to developers, who built flats that they sold abroad, before the flats were built. That means that the South Tower, in Elephant and Castle, is standing empty. An entire tower of 1 and 2 bed flats, that NO ONE lives in. Their investor owners don't even rent them out.

The ripple effect of that is that the residents of the demolished council block had to be rehomed elsewhere. The young couples and families that might have wanted to buy a small flat in Elephant and Castle were priced out - so they have to find homes further out, say in zone 3 of London. Which means the residents of zone 3, are in turn priced out, so they move to the commuter towns around London, which in turn means.... and so it goes on... rippling out across the country.

And no, Southwark Council, who demolished a block of council flats to make this happen, did not build council flats to replace the lost block. And Southwark Council didn't even make a profit on the sale!

This is going on all across London. Some people suggest that the answer is to increase the council tax on vacant properties, but the investors who buy these flats to be "gold bullion in the sky" view council tax as small change.

@yellowbeaker

I don't necessarily think RTB is the problem here- it can be a really great thing. it's the fact that the money raised from sales of council houses has never been funnelled back in to social/affordable housing. That should have been mandatory from the start. It's a crying shame that more isn't built with the proceeds. If you think about it, its actually a pretty good business model for getting people to own their own homes. It's just been totally mismanaged.

But why is getting people into their own houses at the cost of the public purse a good thing? Even if better managed, it still would have cost authorities more to be continually buying up or building stock - and the people who benefit from it are disproportionately the better off council tenants and the ones lucky enough to have better properties, not the most disadvantaged. Many of those who did sell were then ripped off by people who bought low from them and sold on at a profit, plenty are back in council housing again at more cost.

Would have been better to keep rents sustainable, stock higher and have a population that was more mobile, fewer on waiting lists and better able to save for pensions without ruinous private rents.

I also think not enough people have mentioned demographics - people living longer plus waiting longer to marry plus divorcing plus older people holding onto big family properties = massive pressure on stock.

I think you're right that social changes have made a big differences. There must be many more single parent households than there were 20 or 30 years ago. And often, as we see frequently on Mumsnet, even when single parents meet other partners they don't live with them because of (perfectly understandable) reluctance to blend families.

I think empty housing is a disgrace and councils should be able to make it a condition of granting planning permission that a high proportion (95%)? of sales are to uk buyers. They should also be able to compulsorily purchase empty properties.

Lack of supply once we stopped building council/social housing. Not helped by second homes and 'property porn' programmes.

Oh I can see how the the London thing about buying up
Blocks and blocks of flats would cause a Ripple
Effect
Just don’t know the answer
I think it would be good if all out children would be able to work a normal job and be able to either buy a properly for. A reasonable price or at least be able to rent someone not crazy expensive with some security
It worries me massively for the next generation

I live in central london.

The number of empty properties is shameful. I think we should tax the shit out of empty homes and put massive stamp duty onto properties being bought by foreign investors.

But can you really see the current government doing that to their multi-millionaire mates?

My sister is in her early 30s. She is unique amongst her friends in owning (with a mortgage) her own flat in zone 1/2.

When I was at her stage (i'm a decade older) lots of my compatriots owned property.

And yes, the consequences for the next generation are really worrying. Parents aren't going to have post-mortgage money to fund higher education as they are getting their mortgages later or not at all.

Housing insecurity into retirement. Not a pretty prospect.

@LadyofMisrule

It's the other way around. Mortgages used to be capped at about 2.5 x salary of main earner. This kept house prices affordable. Thatcher's changes to the banking and building society arrangements meant that they were allowed to lend more money, allowing house prices to rise to their current value. Now both partners HAVE to work to afford a house.

Interest rates are now much lower, so there's less incentive to save.

Yes it was deregulation that caused the house price boom plus its been estimated that house prices would be 35% lower without green belt policy. Lets blame working women though

I think 100%+ mortgages have a part to play in this. So many people were offered these speculatively and then the market crashed and so many people were in negative equity, the market had to be inflated to attempt to counter this.

I think the way things used to be did help to keep prices lower.
When we got married, 1970, we were both working full time, I was teaching, but only my husband’s salary was allowed to be considered on the mortgage application & we could only borrow two & a half times his yearly income, after tax. Houses would sound ludicrously cheap compared to now but wages were much lower. As a fully qualified full time teacher of four years my monthly salary was £54.
When I got pregnant I had to give up my job two months before the birth at the end of term.
Things were tough, especially when interest rates climbed to 15% on the mortgage. Even though my husband had a good salary as an engineer with a degree, we had to budget every month & I took any type of evening job I could get, pubs, evening classes, market research, while he looked after the dc.
People just couldn’t afford to pay what houses cost today so the market kept house prices lower.