To worry that leading Economists say house prices will hit 15 times earnings

[Ijustwantaquietlife]

This seems like such a frightening prospect. I bought mine when it was 5 times my earnings and even that seemed like I was being a bit risky. How on earth will the next generation ever afford these along with paying back 60k tuition fees and saving enough into a pension to ensure they have enough to not be miserable in retirement?

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Retirement? I think that will be a concept that many will aspire to but few will be able to afford.

The way that I look at is that every generation has had their scare stories and experiences. The three day week, the Cold War, Mad Cow Disease, AIDS (80s specifically), the X Factor. We just pull up or socks and ride it out.

Society is going down the toilet, but I can't see is going from people retiring in their 50s on final salary pensions and having decades of nice holidays and brand new cars to people never having a retirement within a generation.

They wont be able to afford to buy a house or retire. I think we need to loosen planning laws and let people build their own houses they way do in other countries like Brazil and South Africa.

The people retiring at 50 and having decades of nice houses, holidays and cars will continue to do so. The rest of us are fucked and will work until we die or get put in a parish house for the poor.

I'm in my early 30's and I honestly think I'll be lucky if I ever get to retire. Perhaps if I make it to 90.

It is what it is. Many countries don't buy their own houses. A lot of us have a lot more to worry about than owning a house such as their health or where their next meal is coming from.

Who wants to retire in their 50s?

A horrible thought.

I think that as the state pension age rises in line with life expectancy, we will see more and more older people on ill-health benefits for the last few years of their "working" lives. Only those who have been in very well paid jobs will be able to retire before SPA.

If only the well paid will be able to afford to buy a house, the option of downsizing or other forms of equity release won't be open to them.

Having said that, because of the huge variation in house prices across the country, I still think there will be places that will be affordable to those with a half-decent job. It will probably only be those in jobs with national pay scales that will be able to afford them though, unless the minimum wage goes up a lot.

I think we'll start to see life expectancy declining.

Automation is going to have a big impact on available employment for future generations.

Not a surprise sadly. A warning that we must resume house building in large numbers, including social housing.

Life expectancy is going to plummet. The younger generations, on the whole, are a lot unhealthier than their parents were at their age.
This is going to solve the governments pension crisis out. They just have to sit it out.

I think we need to loosen planning laws and let people build their own houses they way do in other countries like Brazil and South Africa.

Try visiting the south coast town of Peacehaven. It was mostly built between the wars. Part of the South Downs was divided up like a chocolate bar. People bought plots of land and just chucked up a house.

The resulting monstrosity was one of the things that led to the Town and Country Planning Act in 1947, and I think most people are very grateful for that. People need open spaces, over-development increases flood risk, damages air quality and ruins environmental diversity.

What we need to do first is to do something about the 600,000+ empty homes, convert empty offices and space above shops for residential use, and generally be more inventive about how we build. And home building is too important to leave to property developers, who are quick to cry "People need homes" when prices are rising and demand is high but aren't so fussed when they're crashing and homes are being repossessed.

It already is in some areas. I think if you live in the southeast, this isn’t a surprise. A 2 bed flat in my sisters area is going for 475k. The average household income is, what 26k? It’s ridiculous. DP and I already worked out we might not be able to buy without help from our parents.

The shift from one to two salary households allowed big property rises to be affordable but we'll need another shift if it's going to go much higher. For example, the concept of multiple families living in a single larger property or extended families living together more as happens in much of the world. The nuclear family will be dead.

I can't see that happening in a free market.

Something is only worth what people will pay for it.

Having a drink with someone the other evening who said their house is worth £1.2m but has been on the market for 2 years. I gave up trying to tell them that it clearly wasn;t if no one had bought it.

the X Factor

That's the most terrifying of the lot.

This is the logical end result as homes as investment rather than as homes to live in.
We need a return to social housing. That way, CHB moves from one department to another, not out into some private investors pocket.

Economists don't have a crystal ball any more than anyone else does, and they haven't always been right in the past.

Prices are already beginning to come down in some areas, including London, where they have risen to crazy levels. There is a lot of blaming of Brexit, and estate agents like to blame stamp duty, but IMO it's largely because prices have simply become unaffordable for many, and there is actually the odd EA who will admit to that.

I am old enough to remember prices going down as well as up, and I'm sure they will again. The thing about over inflated bubbles is that they do usually burst eventually.
The new taxes on buy to let will have an impact IMO - quite a few overleveraged landlords will need to sell, and a good job too, since so many of them have outbid first time buyers in the past.

Life expectancy is going to plummet. The younger generations, on the whole, are a lot unhealthier than their parents were at their age.

What makes you think this?

I think it's a mixed picture in the U.K. tbh. I left the south east at 18 and never returned - if I had I wouldn't have been able to afford a house. I moved north and DH and I - not rich by any means - now have 4 houses, effectively as a retirement investment. They were all cheap and a bit knackered, and now they all have (hopefully happy) tenants in.

I put one of them on the market for a year and got practically zero interest despite dropping the price by 20%. Hardly an overheated market in that part of the U.K.

Until relatively recently the majority of people started work at 16/17.

Now around 55% of young people are going in to higher education and not starting work until their early twenties. So not working any longer for many people.

If house prices reach 16 times earnings. there will be a pretty sharp adjustment very quickly.

I don't necessarily think life expectancy will fall, but I do think people will have more unhealthy years at the end of their lives.

Of course house prices will increase.
Even with a huge house building programme there will still be a shortage.
The birth rate is up, we have a net influx of people and life expectancy is high. Plus there are a significant number of single occupancy houses.
Many countries have vast numbers of renters and very few owners.
We are also a smallish island with a lot of flood plains. At some point we will reach carrying capacity.
But none of this needs to be a disaster - our mindset to our kids futures will have to change.