Phil-UK

Just did a quick calculation over the past 30 years of average yearly salaries compared to median house prices and here are the results:

The figure represents the cost of a house compared to the annual salary, so for 1975 the average house was 2.9 times the average salary, if you could get a mortgage for 3.5 times your salary you'd have no problems. But now in 2005.... well.

1975 2.9
1980 2.6
1985 3.0
1990 4.0
1995 4.3
2000 4.1
2001 4.1
2002 4.5
2003 5.2
2005 7.2

How will our kids afford housing in the future!

Phil

Buzzy--Bee

They will borrow from us!

A dogs life

Its known as mortgaging our future. They've already used up the tax they take from the money we earn. So we have rely on the next generation to earn money to pay taxes to pay our pensions.

Now they rely on us to pay for our kids to afford a house.

Borrowing from Peter to pay Paul.

Its like the governments have got a great big credit card, borrow now, next generation pay later.

mercador

This line explains why many people on this forum can't sell their house for what they think it is 'worth'.

spottydog

Back in the 70's when I was a child most women didn't work after having kids (certainly I don't remeber any of my friends mums working until their youngest child was at least 14) but now my friends have kids most the women want to return to work (and they don't need to for the money) that means that the average houshold for my generation compared to my parents generation has 2 average incomes rather than 1.

Also I remember my parents opening a building society account when I was a baby so I would have a record with them which would help me get a mortgage, now you don't need to have an account with your mortgage provider. It would also be interesting to compare mortgage interest rates over the period as that cuold make a big difference on the cost of servicing a mortgage.

walaj

to take one statistic can be misleading -
Another stat being that as interest rates are much lower than, say, 15yrs ago the proportion of a persons salary paying out for the mortgage is lower (if not the same).
But then you have other stats showing more people are living by themselves thus more housing needed for all the single dwellers, having affect on price.
Then you have the average age people buying their first property increasing - many reasons for this - higher cost of housing, wider credit card use & debts, university debts increasing.

It was a stat like the one you stated but for our area saying that it was one of the highest in the country and there was bound to be a crash - not much increase, but certainly no crash. It did surprise me that we had first time buyers looking at our place, wondering how they could afford it. Well actually one couldn't, we rejected her offers, but don't worry we have SSTC to some one else.

uktruckie

I used to study Statistics and loved it.

I remember being told there are statistics and there are damn lies.

All companies use stats in different ways, mostly to show the good not the bad.

I'm glad to know the housing market is going up, our house is been on the market for a couple of months and not much interst.

Will try another estate agent next year

manxfamily

Are these figures based on UK or Aus prices?

spottydog

I think the saying is there are "lies, damn lies and statistics" and I would certainly agree you can prove anything you want to show with statistics you just have to use the right statistics .

uktruckie

Your right..............thanks "lies, damn lies and statistics"

Shellfish

I failed stats twice - just couldn't get my head around it

Phil-UK

Most of these stats were taken from ABC Diamonds excellent website and are for Oz house prices. ABC provides on his website the median house price and on another link the average annual salaries, I just worked out the figures based on those two figures.

nurselindsey

That means they'll never leave home...............................ARRRGH!

wmoore

Yeah but what's the probability of that?