House price inflation by £1000 per week ?

[Ramseyboi]

4 minutes ago, 2112 said:

I would say that the island has a housing problem. Years ago there was a crisis especially when the prices were beyond the reach of ordinary people. However, property prices fell dramatically and those unable to purchase were then able to purchase due to falling prices. What’s now happened is prices have risen due to new residents moving here, seduced by the lifestyle and IOMG propaganda. What’s not happened is IOMG looking after it’s own and updating its FTB policies, or creating new products and tenures such as Shared Ownership. There is a lot of brownfield urban sites such as Park Road off Derby Road, Douglas. Unfortunately too many civil servants and competing groups have prevented the redevelopment of this site. FTB, Sheltered and Social Housing could have been created. Sadly it’s earmarked for another school!

They are literally in the process of modifying the FTB scheme and a family member who is an estate agents says claims of loads of people coming here are rubbish, as just as many are leaving.  That was also confirmed by the guy from Callisters removals in an interview recently. 

[Apple]

So, we are either heading for a big correction in house prices if and when interest rates rise next year and people start defaulting. Or is that not going to be the case ?

I am always dubious when estate agents make any sort of claims on prices. Also hearing quite a lot of gazumping is going on with and some going along with it.

Should be a fixed price for buying and selling in my view, or Govt help / support with people doing it themselves. 

Edited October 6, 2021 by Apple

[2112]

7 minutes ago, Ramseyboi said:

They are literally in the process of modifying the FTB scheme and a family member who is an estate agents says claims of loads of people coming here are rubbish, as just as many are leaving.  That was also confirmed by the guy from Callisters removals in an interview recently. 

Hence my words seduced and propaganda. We have a thread on here about loads of residents leaving the island, so what you and others say does ring true. Maybe it’s the usual suspects inflating prices, perhaps the market is being rigged? Things aren’t as they seem - a bit like IOMG. The new supposed residents may be the ones coming over on short term contracts, living in cheap rooms on and off the Douglas promenade. 

[hissingsid]

I think there should be more social housing built this is what is needed from 3 beds for families to one bed accommodation for singles whatever their age.   Some private landlords are greedy, young people do not have the chance to save as well as paying ridiculous rents.   When interest rates went down a lot of people invested in a second property to get a return on their money taking out mortgages to make the purchase but being a landlord is not all milk and honey as quite a few have found out with non payment of rent or trashing the property then there is panic because the mortgage has to be paid. I know of someone this has happened to and it was a bad situation all around they nearly lost everything.

[Bombay Bad Boy]

6 hours ago, mad_manx said:

I have rented several over the years and except in 1 case the landlord paid the rates.

(Different from the UK where the council tax is always paid by the tenant)

It was usual practice in the IOM  for rates to be included in the rent quoted but these days I've seen many ads where the rates are paid by tenant. 

This was when I was renting 20 years ago, on the IOM. I was definitely paying the rates, in addition to the rent.

[AcousticallyChallenged]

2 hours ago, Ramseyboi said:

So in 1990 the cost of borrowing was 150 times higher than it is now and the amounts you could borrow were much lower.  I seem to remember 2.5 times my salary plus 1 time the Mrs.

So to borrow £80k I would need to have been earning 25k and her 17.5k. Those were big wages back then.

£1025 a month on a repayment over 25 years.

You could borrow £280k for a similar monthly repayment over the same term today.

 

Average UK house price in 1990 was 57k.

Average UK salary was 13.7k.

So, average house price was what? 4x average salary?

UK living wage now is 18.7k. Average UK salary is 29k.

Average UK house price is 250k. So a house today costs around 10x average salary. 13x living wage.

It doesn't add up whichever way you shake the stick.

Manx average house price now? 313k.

Manx average salary? £611 per week, or around 30k. Living wage is 22k here.

So at present, an average house here is 10x your salary if you earn the average. It is 14x your salary if you're on the living wage.

So, to give the benefit of the doubt, we can adjust for inflation. Adjusted for inflation, 57k in 1990 is 132k in today's money. A 13.7k salary in 1990 would be 31k now, per the Bank of England's inflation calculator.

[The Duck of Atholl]

7 hours ago, AcousticallyChallenged said:

In countries where renting is the norm, renter's rights are significantly better in the face of bad landlords.

So perhaps that issue could be addressed and the obsession with home ownership might abate?

[HeliX]

12 minutes ago, The Duck of Atholl said:

So perhaps that issue could be addressed and the obsession with home ownership might abate?

If home ownership rates significantly decrease, what happens when those people retire and still have to pay rent/care?

[HeliX]

If we force a significant portion of under 30s to leave in order to buy a house, the looming pension crisis is going to get even funnier.

[The Duck of Atholl]

4 minutes ago, HeliX said:

If home ownership rates significantly decrease, what happens when those people retire and still have to pay rent/care?

But there are retirees at present who live in rented accommodation. Currently if you own your own home and need care most of that would disappear in care costs. 

[finlo]

7 minutes ago, HeliX said:

If home ownership rates significantly decrease, what happens when those people retire and still have to pay rent/care?

They don't get to retire!

[HeliX]

Just now, The Duck of Atholl said:

But there are retirees at present who live in rented accommodation. Currently if you own your own home and need care most of that would disappear in care costs. 

Yes, there are. But what happens if there are significantly more?

[The Duck of Atholl]

4 minutes ago, HeliX said:

Yes, there are. But what happens if there are significantly more?

Que? I’m not seeing your point. Are you saying that we fundamentally need home ownership?

[HeliX]

1 minute ago, The Duck of Atholl said:

Que? I’m not seeing your point. Are you saying that we fundamentally need home ownership?

I think Government spend on FTB schemes is probably a better investment than having a huge increase in housing benefit spend in 35-40 years time.

[finlo]

6 minutes ago, The Duck of Atholl said:

Que? I’m not seeing your point. Are you saying that we fundamentally need home ownership?

Yes, I'm pretty sure they'd rather we paid our own care home bills!