Why don't first time buyers withdraw from the property market until prices fall to sensible levels (i.e 拢80k)?

The long term average house price is 3.5 times the average income. Given that the average salary in the UK is 拢23k, then the fair value of a house in this country is circa 拢80k. The average price of a house at the moment is 拢161k, a ludicrously high amount given the average salary level, and also the fact that the average price of a house was 拢57k as recently as 1997. Why on earth do first time buyers continue to pay these ludicrous amounts for property, often financially crippling their parents just to put down a deposit? Why don't they just withdraw from the property market until prices fall to a sensible level i.e the long term average of 3.5 times average income? Why do they choose to take on crippling mortgages just to fund the lavish retirements of those people they are buying from, when the sellers often paid a negligible amount for the same property?|||I think you will find that the majority of them have due to the inability to get a mortgage. it is a free market economy and is self regulating as far as price levels are concerned.|||Probably because the cost of a house will never fall to 拢80k, You can never predict the housing market but ultimately the price will always go up, and the difference between house prices and earnings are bound to increase. You also have to remember that house prices vary all over the country. 拢161k will certainly not get very much where I live!





Renting can also cost more than the cost of a mortgage and they have to live somewhere. Therefore if you want to buy a house, in general terms, waiting is not always the best action to take.|||People need to live somewhere mate. You cant pigeonhole everybody like that. You dont know the circumstances.





I do agree that house prices are stupidly high and if people have another option then they should probably wait. But often people dont. Renting is ok but you may aas wellput your money into something.|||Probably because this generation of Westerners (regardless if we are talking about the U.S. or U.K.) are SPOILED. It is the "I want it now because I deserve it" generation. They didn't see the effort it took for previous generations to attain their prosperity %26amp; wealth. They don't realize it wasn't just handed to their parents.|||This may be coming sooner than you think, though probably not as low as 拢80k. With the problems of quantitative easing about to start filtering in, much higher inflation. The bottom end of the housing market, typically buy to let properties, will not be as attractive as an investment, as Interest rates will go much higher, and they will drop in price.|||You bring up a lot of good points. I made the mistake and purchased a home in 2008 in the US and I am regretting it as prices are plunging.





It's not the young people's fault. It's a stupid housing bubble that's been building for the last 20-30 years. And yes, I am going to walk from my house, you are right.|||Me and my bf brought our first flat 4 months ago, its becuse its the only time we can afford to buy somewhere to live!|||Because it will not drop that low, all that would happen is a minority of people getting property portfolios.|||They may have to wait 50 years or more. People need somewhere to live.|||Hi!


My hubby and I were lucky as we bought our current home in 1999 for a bargain price of 拢57K - it is now worth 拢235K, though it has taken us a lot of money and hard work to do up. As regards first time buyers withdrawing from the property market until prices start to fall - I feel this is unreasonable considering that despite us 'just' emerging from a recession, house prices are already starting to rise, as indeed figures show they have been doing steadily for some months now, and therefore for first time buyers to wait until houses are much cheaper is just a non-starter. They could wait another ten years or so for house prices to fall low enough for them to be able to comfortably afford a home - another ten years in which they may have paid into a scrupulous landlords pocket (not saying all landlords are the same, by the way!), whereas, by struggling for a couple of years with a large mortgage means they have established themselves on the housing ladder and actually have something to call their own at the end of the day. You must understand that not all first time buyers rely on their parents to fund their deposit, indeed the majority don't, and whilst I appreciate your comments about lining the pockets of people due to retire (but then why shouldn't they be adequately compensated when they have worked all of their lives?), I'm afraid that's just the way of the world.|||Where would they live in the meantime?





They would have to rent a house, which would have been brought by somebody else for them to live in, meaning that demand will still outstrip supply forcing the house market up.





In the meantime they will have paid rent for 10 years (or whatever) and be further away than ever from the housing market as it will have risen and their rent is dead money.





It is strange that in one sentence you savagely cut into people who sell their houses to fund lavish retirements and in another moan that children are financially crippling their parents. Often they are one and the same - parents who can afford to help their children because they have large amounts of equity in their own homes.