Why do house price keep rising

[numenor]

There is a lot if discussion about how expensive property is and it keeps rising but people can’t afford.

why then do prices not drop?

Absolutely! I totally agree

I’ve just sold my place to a FTB who is being gifted money to purchase - I started off buying a flat in 2004 and was able to do so on a 100 percent mortgage- anyone remember those?

London’s house prices and proximity of London has been a major problem for the rest of the country. It’s not just the British population causing demand, after Blair’s financial deregulations and the cozying up to Russian and drug money. Of course Blair’s buy to let did not help either. Anything went as long as it had money. London is now the money laundering capital of the world. In other areas, drug money is often blamed. You certainly cannot earn enough to buy properties costing millions.

Has to be massive debt
Inheritance
Or businesses

Exactly. It's the ripple effect of international investment driven demand.

Who are all these single people who can afford to buy homes?

older ones who got on the ladder years ago!

There are 0% deposit mortgages now. There are still parts of the country where you can buy a terrace sub £100k. You don’t actually really need a lot of money to buy- just have been savvy enough to have a reasonable credit score.

Don’t forget the 35 year mortgages and lifetime mortgages passed down to children.

The multimillionaires buying up property that is never lived in as an asset making money.

People buying more than one property as a retirement savings as they go up more than investments.

And as the younger generation are now at home with mom and dat till their 30’s they can’t afford children- so immigration is needed -

The situation is so sad… so much for government looking after it own people.

I work with a lot of young people who are first time buyers. None of them are from inheritance. They saved for a deposit then took on a huge mortgage. I don’t envy them at all to have such big mortgages but they all seem to manage just fine.

Mystery to me. Two have sold sstc on my street in the last few weeks.

Are you certain they have had absolutely no gifted money whatsoever.
I haven’t exactly bandied around the information that the inheritance from my grandma that my parents gifted me to buy a flat 15 years ago helped enormously towards my deposit…! Especially to work colleagues!

The other way is staying at home for a long time paying low dig money, while saving like mad.

Not necessarily. I’m late 30s, and most people I know bought somewhere between their late 20s and mid 30s. It’s mainly London, and certain areas of the SE, where younger people are priced out.

I’m in the north and you can easily get a 3 bed in a nice area for somewhere between 200-300k. That’s affordable for most people on a slightly above average salary. Even on an average salary you could probably get a flat.

Well they all freely discuss their saving strategies over the years to be able to afford them so I’m guessing no major gifts. I know they have been helped with things like a dining table or a sofa, for example but most people can cobble some furniture together anyway, even if it’s second hand.
I have to say I’ve been impressed with how well they can save and all the strategies they come up with for that. Makes me feel pretty lavish 🤣 (and old!)

In most of the country prices are dropping in real terms. They haven’t risen for a while.

Well good for them!
The article I posted upthread said “around half of first time buyers” wrt receiving financial help, so maybe they’re in the other half! And/or you live in a cheaper area?

They almost always have risen, haven't they. But the rate of the increase in prices is nowhere near that of salaries.

A couple of same style homes near me have just been sold. They were both brought from new 6 years ago, and coincidentally sold around the same time recently.

They've been sold for 40% more than what the price paid for them new, 6 years ago. Have salaries increased by 40% In 6 years, inflation wise? For most people I'd say definitely not.

I can't see that this is going to get any easier.

I guess it varies - earning well or scrimping or both. I lived in shared housing until I was in my early 40s. I then made a decision to move out of my area to get a larger but much "cheaper" property than what I would have been able to afford in the city. I feel quite fortunate to be able to afford a mortgage as a single person. If I were in a couple, it would probably have happened much sooner.

They don’t everywhere, but even if they did, demand outstrips supply mostly due to average household size falling.

Or people who earn well, save for years and don't live in the SE (like me)

@MidnightMeltdown but statistically the age of a FTB has got older & it’s not common to buy in your 20s

Supply versus demand ( simples)

I had significant help to get on the ladder, like most of my friends.

Whole blocks of flats in Manchester bought up by Investment / Pension funds (often foreign based). Many of these sit empty, and the ones that aren’t are rented at silly rates.

Properties being built as investments, rather than as Homes, is not helping. We need to crack down on who can buy properties.

Yes I live in Yorkshire so would imagine it’s cheaper here than near London.