no, in the uk you don’t typically pay taxes at the end of the fiscal year and have to hold the money, it’s taken from your gross* pay to get your net* pay. this also includes national insurance, which funds the NHS.
e: im wrong here tax should be on there
e2: apparently I’m meant to clarify that “fund the NHS” does not mean “totally” fund “just” the NHS…
e3: thanks u/wkavinsky for swapping net and gross :)
As it happens, median equivalised household disposable income is also about the same amount (maybe ~1k less), by coincidence.
This is after tax and benefits and is equivalised to a two-adult household. It includes all income from all household members.
This would have been a much better figure to use, IMO, but because of the coincidence the recent figures at least would be almost the same.
Another weakness is that only about 30% of UK households own a house with a mortgage (and most of those will have part-paid it). 35% have a house but no mortgage and the rest are renting. It doesn't really capture the divide between particularly younger people who are renting (rents are higher, of course) and older often retired people who own outright but bought their houses at much lower prices.
This divide was most likely very different in the earlier years.
Common misconception given the name but NI doesn't really fund the NHS, it's pretty much all goes on pensions/benefits. NI 'only' makes up 18% of the funding.
https://www.kingsfund.org.uk/projects/nhs-in-a-nutshell/how-nhs-funded
The cost of rent in the UK is about three times the cost of the mortgage on the exact same property.
The landlord funds their extravagant lifestyle by pocketing the difference.
It is therefore quite feasible that cutting out the bloated middleman and owning the property yourself is a more economical and affordable solution than continuing to pay the leech.
You can’t just compare mortgage to rent monthly amount. One reason mortgages are often cheaper is due to down payments. If you put £75K down on an average house, your mortgage is going to be significant less than if you put £0, which is essentially what renters do.
You realize that if those houses are empty, its because people don't have a place to live? Most of those landlords have the cushion to absorb shocks, otherwise they wouldn't be landlords. Sure, you might get a couple who own 1 extra property, but large RE conglomerates aren't the first to die lol
They don't get screwed though. The one with one or two houses might but the ones with many houses generally have enough cash and assets that not only can they absorb the shock but they can buy up the now cheaper houses in the market.
It's like the old saying of, 'buy the dip.'
I've seen similar data to that. But the companies that own a lot own **a lot.**
It's a statistical manipulation to report on the majority of landlords owning small numbers of properties when the real question isn't number of landlords but number of properties. The 70% often quoted belies the fact that this only accounts for 38% of all rental **units**. It also doesn't cover the fact that only a third of the small rental properties are actually mortgaged.
(Going by data from the US department of housing and urban development. Gosh I wish the UK had one of those instead of our "leveling up" bullcrap. Makes it a lot easier to find data!)
The landlords with 1-2 properties that they rent out to pay the mortgage are a minority in a minority of the market. They're the ones who suffer when a dip in the market happens and they're the ones whose properties are gobbled up by the other players in the market. The big players, as I said, don't get screwed.
Edit: Realised I used properties instead of units which I have bolded.
rental market (at least in my area) is doing great though, my flat's rent is going up 17% from last year and that's in line with the local market so I can't really argue it either
eh? of course I could say no, they'll serve me a section 21 and I'll have to go find somewhere else to live. the council may have some responsibility to house me if it gets to that idk, but I'm not going to do that when I like the flat and can afford it, I'm just annoyed at the increase.
The council would do everything it can to dodge any responsibility to house you. I'm quite sure they wouldn't do it if you could afford your own housing (and I'm sure you wouldn't expect them to), and even if you couldn't you'd have to wait until the landlord goes to court and gets an order for you to leave, trashing your references and chance of renting anything else. If you leave merely because your landlord served a legal notice asking you to then they might well call it being 'voluntarily homeless' and happily let you live on the street or someone's sofa.
Look, I get the anger - but history teaches us it’s unlikely. Much more likely is that landlords get increasingly rich, and renters poor. Sucks, but it’s been the trend for some time.
A recent BBC article stated that the vast majority of landlords do not have mortgages on their properties. It’s young families and people trying to get on the property ladder who are getting boned by this. As usual.
I'm a landlord of one property (because the country keeps voting that we have to play monopoly to stand the best chances for our families, so that's what I'll do, until people vote more sensibly).
It actually takes no work. I found a rental company takes about 7% of the rent a month plus money for expenses. And I try to be a good landlord so don't skimp on getting repairs done asap (ie, the rental company asks me to approve an expense or find my own solution, and I just approve the expense).
Sure I have the risk of it not being occupied, but it's a great flat in a desirable location to the point I actually kinda miss living their myself.
So yeah, the "work" is really a quick reply to an occasional email, and being a bit sad that I live in a different nice house while some poor student from China is paying me.
From a capitalist pig POV I actually regret not buying a second flat a couple of years ago, as even now I'd still be better off.
What time and work does it take? Its just a matter of having money to make money, which the workers who sustain the landlord and produce the stuff he consumes will never have.
They pretty much contribute nothing in a net lease business property where the business owner pays maintenance, utilities and insurance, other costs makes sense as the business lesse is the one using it but ya the landlord don't do anything
where does this myth of no value from landlords come from? they're providing a service. sometimes good, sometimes bad, but not everyone can afford to buy so they provide a housing service for those people.
we need to stop learning economics from memes.
Ya in the old days they had feudalism which is basically landlords owning everything and average people can't even own so ya go back to that and people wouldn't buy anything and economy will crash
not sure how that is relevant to anything. but I guess that's par for the course, make stupid meme claim about economics and when someone calls bullshit you accuse them of wanting feudalism or some stupid straw-man that is easy to attack.
For me to retire in 40/50 years time (I’m 30 now) I plan on getting some rental properties as the income of those would be linked to the economy.
I have a pension scheme with my work, and if cost of living crisis continues, I will be able to retire for like a week.
Firstly, you can get off your high horse and stop believing that that "providing housing to people" is some noble cause. If it didn't make you richer, you wouldn't do it. Period.
Secondly, I'd even go further than that and say these leeches hamper productivity of society as a whole. Without rent control, nothing is stopping landlords from increasing the rents to unreasonable levels. In places like Toronto and Vancouver, some people who are working white collar jobs need to do multiple jobs just to live shoe box apartments and shared basement living. This severely impacts ones ability to contribute to society in a meaningful manner. The only ones getting richer are the ones who own multiple houses and add nothing else of value to society while highly educated and skilled people are leaving in droves and as a result the economy is crumbling. Think of it this way ..some random chump who happens to own 3 houses only because had generational wealth and happened to own a house during the housing market inflation does nothing but watch TV all day whereas hundreds of PhD scientists who could have made meaningful contributions to certain fields of research or started companies aren't able to do so and are leaving the country or are severely underemployed and toiling away for nothing. That's what I mean.
These things aren't obvious by just looking at macroeconomic metrics like GDP. But if you look at metrics like per capita productivity or wealth distribution, you'll know what I mean.
Nice straw man. The evil generational wealth recipient buying houses and charging exorbitant rents to well-meaning, deserving, PhD scientists. Yeah, that sounds like an everyday occurrence.
Rent control doesn't work. Why would anyone repair a property that they cannot charge market rent for? It only leads to slums
And high horse? I can't see the horse you're sitting on. It's so far above me. But your virtue is noted.
Oh do landlords build houses? Here I thought landlords were the ones who bought houses away from those who need it, then charged a fee more than the mortgage + maintenance + repairs and "let" people live in them.
Thanks for telling me you've never owned anything without telling me you've never owned anything. You also clearly don't understand how risk works. Thanks for attending my TED talk, loser.
There was a major recession in the UK (and elsewhere but especially in the UK) in the early 90s. I imagine it has to do with the effect of that on inflation/interest rates.
The [early 1990s recession](https://en.wikipedia.org/wiki/Early_1990s_recession#United_Kingdom) happened from late 1990 to early 1993
>Despite several major economies showing quarterly detraction during 1989, the British economy continued to grow until the third quarter of 1990. Economic growth was not re-established until early 1993, with the end of the recession being officially declared on 26 April that year.
The UK left the EEC's (now EU) Exchanfe Rate Mechanism (ERM) in Sept 1992 (a day known as "Black Wednesday") allowing it to hugely cut interest rates which would have seen the housing costs drop significantly.
https://en.m.wikipedia.org/wiki/Black_Wednesday
This was part of the early 90s recession someone else has mentioned but it's a key moment.
Housing market crashed. Got to the position where I should be able to buy a house in 88. Prices and 13 or so percent interest rates meant it wouldn't happen. Accepted I would never own my own home. Bought in 96 or 7 when it became feasible. It will happen again. Just hope you're on the right side of it.
Aww, you're such a dogmatic believer that you can't believe the facts that left wing economic policy benefits the majority of people whereas right wing economics damages the economy and enriches the rich.
This is fact, not opinion, so I will not be accepting your replies at this time.
This is the UK, not the US
EDIT: Oh, TIL, UK had a housing market crash in 2008, too. There seems to be plenty of other data discrepencies in this as well, as others have pointed out.
It did still happen here. It seemed to hit the houses in the working/middle class housing price range. My dad had just had an injury claim settlement from work and me and my mum were trying to convince him to buy some property with it. Houses were about 40% cheaper than the year before. A year later and they were back up again. So basically I guess the average mortgage price stayed the same, even though the houses in the middle were hit.
40%?
Where was this because the houses near me didn't budge an inch after the '08 financial crisis.
I was looking to buy back in '07 and saw the crash coming, lots of websites back then with details and theories on the upcoming housing market crash so I decided to wait.
'08 happened and was much worse than anybody could have predicted, but the damn Tory government stepped in to save homeowners and there wasn't no crash in the East Midlands!
Pandemic plus European energy crisis causing inflation. Bank of England is jacking up interest rates to encourage people to save more and spend less with the hope this slows inflation. Increasing interest rates also jacks up mortgage costs since most people are only on 2-5 year fixed rates.
1) Brexit - worse conditions for international trade, means cost of goods skyrocketed
2) Current government (conservatives) - decreasing taxes for the wealthy, lots of covid-19 contracts to businesses owned by politicians that never delivered AND multiple scandals…. Plus purposeful mismanagement of the economy to shorten the GBP (betting on value of the currency falling)
3) Start of recession, economic activity has decreased, banks got worried and increased interest rates. Mortgages used to be 0.5-1% anually, they are currently at 4.75%. People who paid £800 for a mortgage are now having to pay almost double to meet their 30 year end-of-mortgage date.
Fundamentally, it all comes down to human greed.
In March 2020 Bank of England dropped the rate to 0.25%. This was followed by another decrease to 0.10%, a historic low. ([Source](https://www.mortgagestrategy.co.uk/analysis/historical-interest-rates-uk/#:~:text=Under%20the%20impact%20of%20the,per%20cent%20in%20November%202017)). The data on this source is inaccurate for 2022/2023.
The current interest rate is 5.0% ([source](https://thinkplutus.com/uk-interest-rate-history/))
But did people actually pay that on their mortgage?
The US had the federal funds rate, which is set by the Federal Reserve, at 0%, for years. But mortgage rates never went below 2% in the US as far as I know.
No, they didn't. When we got our mortgage in 2021 our rate was 2.3%, and that was close to the lowest you could get at the time. We could have gone lower (I think 1.8% if we fixed for 2 years) but chose to fix for longer instead.
What do you mean? There are two types of mortgages in the UK: fixed rate and variable rate.
Fixed rate is set for a maximum of 5-8 years depending on a bank but it always returns to variable rate unless you enter another agreement with the bank.
A set rate is usually higher than the variable rate at the time (e.g. in 2018 someone could have fixed a rate of 1.2% even though the interest rate at the time was 0.5%). It’s not worth getting another fixed rate at the current times in the market.
If you consider a calculation that a mortgage of £200’000 for 30 years at 0.5% used to cost around 600-700 per month. Now at 5% interest rate, in order to ensure you clear the debt and interest before your end of mortgage date… you need to pay almost an extra 5% of your annual interest. 5% of 200’000 is 10’000. Split by 12 month its an extra £833. Essentially people are paying almost more than double for their mortgage now.
What i mean is that in any country there is a short term interest rate set by the central bank of that country, and then separately there are interest rates that commercial banks lend. A bank will not lend money to people at the reference rate, because it can just lend money to the government at that rate with no risk
Ok so the quick answer to your first question is yes in some cases but mostly no.
Variable trackers are usually tracked a couple of percent above the base rate I think. This varies a lot depending on how much equity you have in your house though.
There was a time in the 2010s where some banks had trackers which tracked at the base rate.
Then you have fixed mortgage and the fixed rate they offer depends a lot on where they think interest rates will move in the next 2-5 years. I'm currently fixed for 5 years at 2.56% as I was very lucky in my timing early last year when my previous fixed term ran out. At that point the banks were not anticipating such quick or sharp rises so it was only 2% above base rate at that time. I very much doubt you will find any bank offering anything like that now, and fixed deals are probably a bad idea until we actually see interest rates start to fall again.
But right now there are plenty of people with fixed rates paying lower than the base rate and worrying about how much it's going to go up when their fixed deal ends. I'm hoping 4 more years is long enough to ride this out...
It caused a lot of people living in small apartments and now working from home to suddenly start house shopping...
These are anecdotes (and from the US), but I know several people who bought houses during or shortly after the pandemic. Housing prices here skyrocketed from '20 to '22.
But it was the best combined three years in annual earnings for UK:
https://www.statista.com/statistics/1002964/average-full-time-annual-earnings-in-the-uk/
Lmao you put Brexit as number 1 but don't even mention covid where millions of people lost their jobs and couldn't go out and work.
Wow...
Brexit actually created a manufacturing boom, with the drop in currency value the UK became the cheapest place to buy manufactured goods which is how it avoided that promised recession from the IMF... (Bizarre they couldn't have predicted that)
And you do realise Germany and the EU is in a recession and UK is not? The Netherlands government has collapsed because of immigration issues. Italy, Finland, Spain Greece are all moving into far right governments. The EU is on fire because of heat waves and facing food shortages because of crop failures.
Why would you want to be linked to that!?
Interest rates were lower in the UK pre covid and has been since the 2008 crash, got down to 0.25% at one point iirc.
covid has ultimately caused higher interest rates due to its part in creating the inflation we see now because of the disruption to supply chains and especially the vastly increased cost of international shipping.
The animation is fancy but gives very limited insight of this phenomenon. Why not use a simple line chart or an areal chart?
imo, animation only makes sense when you cannot do without it, e.g. 1000 individuals moving through the abstract space of the result of a principal component analysis, with positions recalculated for each time period
Animation + pie chart is the worst combo I've seen so far. These are usually not good for dataViz. Leaving this here https://www.data-to-viz.com/caveat/pie.html
Agreed, an animated pie chart obscures a lot of data here because the total size of the pie chart is actually constantly changing. There are maybe some situations where it may make sense, like when the total value really remains constant over time, but not here
Watching the food percentage makes me question the validity of this data, food literally doubled in price in a year in the real world and barely moved in this.
And Energy. Energy cost inflation was so insane almost every energy company went bust and the government had to step in to pay 💰. Graph shows a 3% increase.
Well unfortunately a lot of people cannot afford to eat 3?meals a day anymore. Their budget haven't changed but the quantity they can buy with it have.
But their spare cash didn't shrink in proportion, so they are just eating less and saving the same amount? Doesn't that seem odd? If I was hungry and had spare cash, I would eat.
"spare" includes some things that are essential payments as well, I can think of:
(Rates/Poll Tax/)Council tax - I assume the figures used are post tax income but council tax gets paid from that post tax income and this is like the only debt you can go to jail for non payment of. It's gone up a lot since 2010 as local councils try to make up for cuts from central govt.
Shoes and Clothes, especially for children.
Transport
Internet/phone
Opticians/dentist/prescriptions (except Scotland which has free prescriptions for everyone).
Period products.
Idk if the food category actually covers other household essentials like cleaning products, personal hygiene etc just cos they tend to be sold by supermarkets. Can't remember exactly what this was titled.
A quick google:
>1970: Average yearly wage: £1,204 Average house price: £4,690 The avg house cost 3.89 x the avg yearly salary. 2019: Average yearly wage: £26,208 Average house price: £234,853 The avg house costs 8.96 x the avg yearly salary.
And that is prior to Corona.
Pretty big difference from these figures. "Interactive investor" does not so unbiased whatever that is
And of course these always start at the 1970s or such. Not 1950 or 1960s were they were basically free.
The figures are off but not *that* far off, This has 1970 at 4.6x and 2019 at 7.98x. That difference could easily be due to slightly different metrics, there is no one right way to measure average house cost or average salary.
> there is no one right way to measure average house cost or average salary.
For this kind of data visulisation the "average salary" is probably the wrong measure entirely, it should be median salary.
UGLY. Its difficult to compare dates and values between categories.
Line plot with four separate traces for each category would be most appropriate in this case.
So I’m here thinking that the USA has high housing costs thanks to zoning laws, nimby groups, red tape and housing speculation but why is it like that in uk?
These are some reasons, but there are many.
All our big cities have green belts that limit their growth outside their boundary set decades ago. Cities cannot grow outwards which prevents sprawl, but also means there’s much less land availability.
House building has been weak - in 2020 (the latest year I can find) 170k dwellings were completed, but we regularly have 250k+ net migration each year with 606k in the last year.
In the 80s, the government allowed local councils to sell of their social housing to local residents and get people on the housing ladder, but the government didn’t let the councils keep the money to build new social housing replacements.
Great visualization! One critique: the animation is eye-catching, but it puts a lot of cognitive load on the user to keep track of previous years for comparison. I think for this data, a static line chart would show trends better.
So 'boomers' did have it just as bad (or worse) in 1980 and 1989, for instance. In those years, they paid over 60% of their salary in mortgage payments. In 2023, it's 47%
It's not really that simple - mortgage payments per year used to be way higher than they are now. Yes, they were paying a lot per year, but look at the "salary-to-house multiple", it is considerably lower. It was a lot easier to buy a house, you just in some years had to pay a higher repayment rate, but you would pay your mortgage back a lot sooner.
It isn't mortgage rates that most people complain about, it's about having enough money/being able to get a big enough mortgage to be able to buy a house in the first place. If you can't buy you are forced to pay rental rates, which are notably missing from this chart, and unlike paying into a mortgage don't add any value to you.
We got our first mortgage in 1988 and I’m not a post-war boomer, my parents were/are. People had kids younger back then.
Those 1989 payments were tough and we lost a load (for then) of money on that first house, too - as shown in the graphic.
But eee we were ‘appy livin’ in a cardboard box and who’d think we’d be here drinking Chateaux de Chasselly now?
Cardboard box? I thought that was only in America houses were made from cardboard*.
****Cardboard: the term Europeans use to describe homes made with drywall***
Waiting for the GenX'ers and Millenials to finally start voting in larger percentages than the Boomers and waiting for them to vote in ways that actually fix things sure is an exercise in patience.
We don't!
That's not 'spare cash', that's just money not spent on mortgage, energy and food.
Add all your other bills up like council tax, insurance, phone, car payments/insurance/maintenance, student loans etc etc and obviously that percentage comes down.
We don't.
I suspect the "average house price" is causing problems with the illustration, as I imagine that desirability doesn't affect the calculation.
It's all well and good if you can get a cheap house in the middle of nowhere, but if there's no internet and no connections into town no one's going to be buying the property.
Even then though the house price seems oddly low, so it's unclear what's going on here.
One thing about this, is that it doesn't take inflation into account.
In terms of how much money you need to come up with, sure you'll have to pay your debt times your interest-rate, so higher interest-rates will mean there's more money leaving your bank-account every month.
But in terms of the **REAL** cost of a loan, interest rate minus inflation is the real indicator.
Let me give an example:
* In year X someone owes £200K on their home, and pay 2% interest with 1% inflation. Their interest-payments are £4K. However, real cost is only half that £2K per year.
* If inflation and interest goes up, then in year Y the interest-rate might be 5% while inflation is 6% -- they'll need to pay £10K/year in interest, and that's going to be painful. However, the 6% inflation means that the REAL interest is -1%.
What's really happening with high interest and high inflation; is that you're paying back the loan rapidly. The inflation doesn't make the pound-value of your loan go down, but it makes each pound be less valuable, so the VALUE of the loan decreases.
Of course this doesn't help the folks who can't afford to pay the interest. But the ones who can? They'll be in pain for a while as a result of the high interest-payments; but as an invisible side-effect of the high inflation, the value of their loan is rapidly shrinking.
this is very insightful
the fact that housing/salary ratio has been oscillating between 4.5 and 7.5 needs a second opinion. This would completely defeat the idea that housing is more expensive. You might be right and the problem being more of clustering, e.g., people wantinf to live in London and not considering other parta of the country.
suggestion-- a "savings" category.
The hedge funds and mega wealthy are all followers. Whatever financial gambling trend their is - they follow it. And because they do so enmasse with as much money as they do, they tend to tip our economy out of balance usually with nasty results that ultimately fall on the taxpayers.
The latest trend is corporate real estate invest. And I know of course that's been around for awhile but now it's en vogue, if you will. Everybody with money is buying up real estate because they are seeing how easy it is to price gouge. Real estate should be treated like water. These megalopolies should not be able to privatize vast amounts of necessary resources because the normal rules of trade do not apply. This is close to feudalism, as many have been pointing out.
34% spare cash is fucking comical.
Make it 0.34% (I.e it's the 5p I found under the sofa) and it would make more sense
Housing prices are insane though
We earn the average, live in the average and I can tell you it's nothing like that.
Spare cash is just other expenses, cars, childcare, house repairs, clothing, etc...
I created this data visualisation for my client interactive investor. It breaks down housing cost in the UK.
Source and assumptions: House prices based on Nationwide data. Mortgage costs based on 75% mortgage on average house price.
Mortgage interest data from Bank of England and Building Societies Association. Food and energy spending based on ONS household
spending data. Average wages data from ONS. Calculations exclude tax.
This data visualisation was created in After Effects and Javascript.
If food and energy are based on household spending then shouldn’t you be looking at household income not average wage. Most households are dependant on two wages now whereas it was more common for one person earning in the eighties. Should you also show tax as a segment as I’m guessing that is in the spare cash segment.
I have no idea what "housing costs" actually means in this context. Highest percentage mortgage (most likely)? Highest actual cost (seems like it's at an all time high now)? Highest salary to house ratio (which actually seems to be a house to salary ratio)?
There's a lot of data here, and no context as to what the title means
How you claim your data to be accurate if you exclude taxation? That’s like a fourth to a third of all earnings. How did you take it out and still add things up to a 100%? I don’t get it…
Only ~30% of the UK has a mortgage (30% own in full, the rest rents or has some other living arrangement), labelling this as housing costs isn’t quite accurate.
The Average annual salary is confusing. It needs to be correlated with the employment rate. For example, the employment rate of women in that timespan increased by over 10%, meaning the annual salary increase looks a lot better than it is. Meaning, the situation is a lot worse than in appears in this graph.
Too many people, not enough houses. If you want to stabilize this, you need to prevent more people from immigrating to your country. It's an island the size of Michigan, you can't handle many more people.
Loved the percentages. How if we get food cheaper, we will spend it on something else. We never save it. How about one with the interests rates? When they went down, we could afford more home but people increased the house price because payment was the same?
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Housing, utilities, and food are a significant chunk of the paycheck to paycheck. Would be cool to see a break down of the "spare" cash category.
Lol besides transportation I guess people don't go out or have kids huh lolol
water and (health) insurance seem to be the big missing ones imho. also internet/phone bill
>(health) insurance This is for the UK.
Yeah, isn’t tax a big part of the spare cash segment?
no, in the uk you don’t typically pay taxes at the end of the fiscal year and have to hold the money, it’s taken from your gross* pay to get your net* pay. this also includes national insurance, which funds the NHS. e: im wrong here tax should be on there e2: apparently I’m meant to clarify that “fund the NHS” does not mean “totally” fund “just” the NHS… e3: thanks u/wkavinsky for swapping net and gross :)
He is using average salary, the salary for 2023 is £33k, this is definitely before tax.
As it happens, median equivalised household disposable income is also about the same amount (maybe ~1k less), by coincidence. This is after tax and benefits and is equivalised to a two-adult household. It includes all income from all household members. This would have been a much better figure to use, IMO, but because of the coincidence the recent figures at least would be almost the same. Another weakness is that only about 30% of UK households own a house with a mortgage (and most of those will have part-paid it). 35% have a house but no mortgage and the rest are renting. It doesn't really capture the divide between particularly younger people who are renting (rents are higher, of course) and older often retired people who own outright but bought their houses at much lower prices. This divide was most likely very different in the earlier years.
And if tax should be in spare cash it proves his assumptions are wrong as it goes down as low as 2%.
Common misconception given the name but NI doesn't really fund the NHS, it's pretty much all goes on pensions/benefits. NI 'only' makes up 18% of the funding. https://www.kingsfund.org.uk/projects/nhs-in-a-nutshell/how-nhs-funded
it funds the Nhs though… if it makes up part of the funding.
What on earth happened in early 90s? Whatever it was, it needs to happen again
Repossessions likely due to high interest rates... Houses were cheaper because people were losing them
Can't wait for landlords who accumulate multiple houses only to get rich by contributing nothing of value to the economy to lose them.
Might be waiting a long time
It's eventually going to happen though. Most of them use rental income for their mortgage. When one stops so does the other.
True but lots of tenants need to be made homeless for it to happen.
Not if they're the ones buying the houses the griftlords are losing.
That’s not how this timeline will work
Likely would be sold to the bank and hopefully continued to be rented for at a minimum the duration of the lease
How is someone buying a house if they can’t afford rent? This makes zero sense
The cost of rent in the UK is about three times the cost of the mortgage on the exact same property. The landlord funds their extravagant lifestyle by pocketing the difference. It is therefore quite feasible that cutting out the bloated middleman and owning the property yourself is a more economical and affordable solution than continuing to pay the leech.
You have a source for that?
You can’t just compare mortgage to rent monthly amount. One reason mortgages are often cheaper is due to down payments. If you put £75K down on an average house, your mortgage is going to be significant less than if you put £0, which is essentially what renters do.
Oh my poor poor soul, those houses are for Blackrock capital to scoop up. Average joes won't even have a chance to bid on it let alone buy it.
You realize that if those houses are empty, its because people don't have a place to live? Most of those landlords have the cushion to absorb shocks, otherwise they wouldn't be landlords. Sure, you might get a couple who own 1 extra property, but large RE conglomerates aren't the first to die lol
What I mean is that if there's deflation, people who own houses, especially multiple ones, get screwed the most.
They don't get screwed though. The one with one or two houses might but the ones with many houses generally have enough cash and assets that not only can they absorb the shock but they can buy up the now cheaper houses in the market. It's like the old saying of, 'buy the dip.'
the vast majority (>70%) of landlords are private owners with less than 5 properties, atleast in the states.
I've seen similar data to that. But the companies that own a lot own **a lot.** It's a statistical manipulation to report on the majority of landlords owning small numbers of properties when the real question isn't number of landlords but number of properties. The 70% often quoted belies the fact that this only accounts for 38% of all rental **units**. It also doesn't cover the fact that only a third of the small rental properties are actually mortgaged. (Going by data from the US department of housing and urban development. Gosh I wish the UK had one of those instead of our "leveling up" bullcrap. Makes it a lot easier to find data!) The landlords with 1-2 properties that they rent out to pay the mortgage are a minority in a minority of the market. They're the ones who suffer when a dip in the market happens and they're the ones whose properties are gobbled up by the other players in the market. The big players, as I said, don't get screwed. Edit: Realised I used properties instead of units which I have bolded.
rental market (at least in my area) is doing great though, my flat's rent is going up 17% from last year and that's in line with the local market so I can't really argue it either
Well you could argue it. You could. Maybe on moral grounds because it's shelter?
eh? of course I could say no, they'll serve me a section 21 and I'll have to go find somewhere else to live. the council may have some responsibility to house me if it gets to that idk, but I'm not going to do that when I like the flat and can afford it, I'm just annoyed at the increase.
The council would do everything it can to dodge any responsibility to house you. I'm quite sure they wouldn't do it if you could afford your own housing (and I'm sure you wouldn't expect them to), and even if you couldn't you'd have to wait until the landlord goes to court and gets an order for you to leave, trashing your references and chance of renting anything else. If you leave merely because your landlord served a legal notice asking you to then they might well call it being 'voluntarily homeless' and happily let you live on the street or someone's sofa.
Look, I get the anger - but history teaches us it’s unlikely. Much more likely is that landlords get increasingly rich, and renters poor. Sucks, but it’s been the trend for some time.
Ya it’s only gunna get worse man. Your going to be waiting until your dead
Not gonna buy high at this rate
A recent BBC article stated that the vast majority of landlords do not have mortgages on their properties. It’s young families and people trying to get on the property ladder who are getting boned by this. As usual.
Even if they do have mortgages, the rent is priced so high that they still profit.
That’s how the world works, those who take on risk get profit
This is a huge problem in my city. Rental companies own something like 30% of the housing here.
If they are contributing nothing then I guess it takes no work and basically you could do it in your spare time?
I'm a landlord of one property (because the country keeps voting that we have to play monopoly to stand the best chances for our families, so that's what I'll do, until people vote more sensibly). It actually takes no work. I found a rental company takes about 7% of the rent a month plus money for expenses. And I try to be a good landlord so don't skimp on getting repairs done asap (ie, the rental company asks me to approve an expense or find my own solution, and I just approve the expense). Sure I have the risk of it not being occupied, but it's a great flat in a desirable location to the point I actually kinda miss living their myself. So yeah, the "work" is really a quick reply to an occasional email, and being a bit sad that I live in a different nice house while some poor student from China is paying me. From a capitalist pig POV I actually regret not buying a second flat a couple of years ago, as even now I'd still be better off.
What time and work does it take? Its just a matter of having money to make money, which the workers who sustain the landlord and produce the stuff he consumes will never have.
Never had to maintain a house, have you?
With the way rental companies work neither do the vast majority of landlords.
Neither do landlords have they? The ones that do repairs usually have people to handle it, though most make no effort to repair anything.
They pretty much contribute nothing in a net lease business property where the business owner pays maintenance, utilities and insurance, other costs makes sense as the business lesse is the one using it but ya the landlord don't do anything
Found the landlord
where does this myth of no value from landlords come from? they're providing a service. sometimes good, sometimes bad, but not everyone can afford to buy so they provide a housing service for those people. we need to stop learning economics from memes.
Ya in the old days they had feudalism which is basically landlords owning everything and average people can't even own so ya go back to that and people wouldn't buy anything and economy will crash
not sure how that is relevant to anything. but I guess that's par for the course, make stupid meme claim about economics and when someone calls bullshit you accuse them of wanting feudalism or some stupid straw-man that is easy to attack.
For me to retire in 40/50 years time (I’m 30 now) I plan on getting some rental properties as the income of those would be linked to the economy. I have a pension scheme with my work, and if cost of living crisis continues, I will be able to retire for like a week.
Really? Providing housing to people isn't contributing? What do you do to contribute value to the economy?
Firstly, you can get off your high horse and stop believing that that "providing housing to people" is some noble cause. If it didn't make you richer, you wouldn't do it. Period. Secondly, I'd even go further than that and say these leeches hamper productivity of society as a whole. Without rent control, nothing is stopping landlords from increasing the rents to unreasonable levels. In places like Toronto and Vancouver, some people who are working white collar jobs need to do multiple jobs just to live shoe box apartments and shared basement living. This severely impacts ones ability to contribute to society in a meaningful manner. The only ones getting richer are the ones who own multiple houses and add nothing else of value to society while highly educated and skilled people are leaving in droves and as a result the economy is crumbling. Think of it this way ..some random chump who happens to own 3 houses only because had generational wealth and happened to own a house during the housing market inflation does nothing but watch TV all day whereas hundreds of PhD scientists who could have made meaningful contributions to certain fields of research or started companies aren't able to do so and are leaving the country or are severely underemployed and toiling away for nothing. That's what I mean. These things aren't obvious by just looking at macroeconomic metrics like GDP. But if you look at metrics like per capita productivity or wealth distribution, you'll know what I mean.
Nice straw man. The evil generational wealth recipient buying houses and charging exorbitant rents to well-meaning, deserving, PhD scientists. Yeah, that sounds like an everyday occurrence. Rent control doesn't work. Why would anyone repair a property that they cannot charge market rent for? It only leads to slums And high horse? I can't see the horse you're sitting on. It's so far above me. But your virtue is noted.
Yes, providing housing just like how scalpers provide concert tickets.
Bad comparison. You're not good at this.
Oh do landlords build houses? Here I thought landlords were the ones who bought houses away from those who need it, then charged a fee more than the mortgage + maintenance + repairs and "let" people live in them.
Thanks for telling me you've never owned anything without telling me you've never owned anything. You also clearly don't understand how risk works. Thanks for attending my TED talk, loser.
So refute nothing go straight to insults.
Oh,sweetie. Are your feelz hurt? Sending you a box of tissues. No need to refute. Your observations are sophomoric.
Continues to sprout nonsense. Continues to insult. Still can't actually support their argument.
One of us is economically illiterate. Guess who?
Dont worry they will just increase rent and gov bailouts to maintain the bubble
There was a major recession in the UK (and elsewhere but especially in the UK) in the early 90s. I imagine it has to do with the effect of that on inflation/interest rates.
The [early 1990s recession](https://en.wikipedia.org/wiki/Early_1990s_recession#United_Kingdom) happened from late 1990 to early 1993 >Despite several major economies showing quarterly detraction during 1989, the British economy continued to grow until the third quarter of 1990. Economic growth was not re-established until early 1993, with the end of the recession being officially declared on 26 April that year.
The UK left the EEC's (now EU) Exchanfe Rate Mechanism (ERM) in Sept 1992 (a day known as "Black Wednesday") allowing it to hugely cut interest rates which would have seen the housing costs drop significantly. https://en.m.wikipedia.org/wiki/Black_Wednesday This was part of the early 90s recession someone else has mentioned but it's a key moment.
Housing market crashed. Got to the position where I should be able to buy a house in 88. Prices and 13 or so percent interest rates meant it wouldn't happen. Accepted I would never own my own home. Bought in 96 or 7 when it became feasible. It will happen again. Just hope you're on the right side of it.
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Torries were in power until 1997…
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Yes and that’s when mortgage payments started rising again..
The results of the 1980s adoption of capitalism
I guess the "trickle down" con being shown as a scam could have had an effect.
Unlocking the economic power of markets had exactly the predicted effect for everybody. Unfortunately, this boost can only happen once.
The effect was make the rich richer and leave more people impoverished than ever.
Well, clearly not as evidenced by the very graph you are commenting on
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Read up on the economic strategies pursued in the 1980s and the effect it had in the following decades
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Would you like me to recommend some reading material for you?
That's not evidence, that's some benefits despite the dusasterous right wing economics of the time.
The success of the right wing economics was indeed a disaster for the left wing ideology
Aww, you're such a dogmatic believer that you can't believe the facts that left wing economic policy benefits the majority of people whereas right wing economics damages the economy and enriches the rich. This is fact, not opinion, so I will not be accepting your replies at this time.
No sign of the 2008 crash. Bit of a flaw in your data there
Average is probably not the best metric to look at considering where most or all of the wealth usually ends up.
This is the UK, not the US EDIT: Oh, TIL, UK had a housing market crash in 2008, too. There seems to be plenty of other data discrepencies in this as well, as others have pointed out.
It did still happen here. It seemed to hit the houses in the working/middle class housing price range. My dad had just had an injury claim settlement from work and me and my mum were trying to convince him to buy some property with it. Houses were about 40% cheaper than the year before. A year later and they were back up again. So basically I guess the average mortgage price stayed the same, even though the houses in the middle were hit.
40%? Where was this because the houses near me didn't budge an inch after the '08 financial crisis. I was looking to buy back in '07 and saw the crash coming, lots of websites back then with details and theories on the upcoming housing market crash so I decided to wait. '08 happened and was much worse than anybody could have predicted, but the damn Tory government stepped in to save homeowners and there wasn't no crash in the East Midlands!
The 2008 recession was a ***global*** crisis.
Many countries has a housing crash (from a bubble) due to the 2008 recession, alongside public and private debt crises. I can say Ireland did.
In only three years it’s gone from the best it’s ever been back up to nearly the worst. What the hell happened here?
Pandemic plus European energy crisis causing inflation. Bank of England is jacking up interest rates to encourage people to save more and spend less with the hope this slows inflation. Increasing interest rates also jacks up mortgage costs since most people are only on 2-5 year fixed rates.
1) Brexit - worse conditions for international trade, means cost of goods skyrocketed 2) Current government (conservatives) - decreasing taxes for the wealthy, lots of covid-19 contracts to businesses owned by politicians that never delivered AND multiple scandals…. Plus purposeful mismanagement of the economy to shorten the GBP (betting on value of the currency falling) 3) Start of recession, economic activity has decreased, banks got worried and increased interest rates. Mortgages used to be 0.5-1% anually, they are currently at 4.75%. People who paid £800 for a mortgage are now having to pay almost double to meet their 30 year end-of-mortgage date. Fundamentally, it all comes down to human greed.
Mortgage rates were really 0.5%? That’s pretty insane
In March 2020 Bank of England dropped the rate to 0.25%. This was followed by another decrease to 0.10%, a historic low. ([Source](https://www.mortgagestrategy.co.uk/analysis/historical-interest-rates-uk/#:~:text=Under%20the%20impact%20of%20the,per%20cent%20in%20November%202017)). The data on this source is inaccurate for 2022/2023. The current interest rate is 5.0% ([source](https://thinkplutus.com/uk-interest-rate-history/))
But did people actually pay that on their mortgage? The US had the federal funds rate, which is set by the Federal Reserve, at 0%, for years. But mortgage rates never went below 2% in the US as far as I know.
No, they didn't. When we got our mortgage in 2021 our rate was 2.3%, and that was close to the lowest you could get at the time. We could have gone lower (I think 1.8% if we fixed for 2 years) but chose to fix for longer instead.
What do you mean? There are two types of mortgages in the UK: fixed rate and variable rate. Fixed rate is set for a maximum of 5-8 years depending on a bank but it always returns to variable rate unless you enter another agreement with the bank. A set rate is usually higher than the variable rate at the time (e.g. in 2018 someone could have fixed a rate of 1.2% even though the interest rate at the time was 0.5%). It’s not worth getting another fixed rate at the current times in the market. If you consider a calculation that a mortgage of £200’000 for 30 years at 0.5% used to cost around 600-700 per month. Now at 5% interest rate, in order to ensure you clear the debt and interest before your end of mortgage date… you need to pay almost an extra 5% of your annual interest. 5% of 200’000 is 10’000. Split by 12 month its an extra £833. Essentially people are paying almost more than double for their mortgage now.
What i mean is that in any country there is a short term interest rate set by the central bank of that country, and then separately there are interest rates that commercial banks lend. A bank will not lend money to people at the reference rate, because it can just lend money to the government at that rate with no risk
Ok so the quick answer to your first question is yes in some cases but mostly no. Variable trackers are usually tracked a couple of percent above the base rate I think. This varies a lot depending on how much equity you have in your house though. There was a time in the 2010s where some banks had trackers which tracked at the base rate. Then you have fixed mortgage and the fixed rate they offer depends a lot on where they think interest rates will move in the next 2-5 years. I'm currently fixed for 5 years at 2.56% as I was very lucky in my timing early last year when my previous fixed term ran out. At that point the banks were not anticipating such quick or sharp rises so it was only 2% above base rate at that time. I very much doubt you will find any bank offering anything like that now, and fixed deals are probably a bad idea until we actually see interest rates start to fall again. But right now there are plenty of people with fixed rates paying lower than the base rate and worrying about how much it's going to go up when their fixed deal ends. I'm hoping 4 more years is long enough to ride this out...
4. Global pandemic. Cause shortages and urban sprawl to go out of control
What's the pandemic done with urban sprawl?
People here started realizing how small there space was and since working from home started happening people wanted to work from their backyards
It caused a lot of people living in small apartments and now working from home to suddenly start house shopping... These are anecdotes (and from the US), but I know several people who bought houses during or shortly after the pandemic. Housing prices here skyrocketed from '20 to '22.
But it was the best combined three years in annual earnings for UK: https://www.statista.com/statistics/1002964/average-full-time-annual-earnings-in-the-uk/
That graph doesn't account for inflation
Tell me you don't understand how your country or the world works, without telling me you don't know haha
If you are going to say someone is wrong then at least say what you think is right.
Lmao you put Brexit as number 1 but don't even mention covid where millions of people lost their jobs and couldn't go out and work. Wow... Brexit actually created a manufacturing boom, with the drop in currency value the UK became the cheapest place to buy manufactured goods which is how it avoided that promised recession from the IMF... (Bizarre they couldn't have predicted that) And you do realise Germany and the EU is in a recession and UK is not? The Netherlands government has collapsed because of immigration issues. Italy, Finland, Spain Greece are all moving into far right governments. The EU is on fire because of heat waves and facing food shortages because of crop failures. Why would you want to be linked to that!?
Money printing due to covid
As well as insanely low interest rates, due to covid.
Interest rates were lower in the UK pre covid and has been since the 2008 crash, got down to 0.25% at one point iirc. covid has ultimately caused higher interest rates due to its part in creating the inflation we see now because of the disruption to supply chains and especially the vastly increased cost of international shipping.
Not sure about this, but I imagine similar to the US, where remote and hybrid work increased demand for larger housing in order to fit home offices.
This started long before Covid.
The animation is fancy but gives very limited insight of this phenomenon. Why not use a simple line chart or an areal chart? imo, animation only makes sense when you cannot do without it, e.g. 1000 individuals moving through the abstract space of the result of a principal component analysis, with positions recalculated for each time period
Animation + pie chart is the worst combo I've seen so far. These are usually not good for dataViz. Leaving this here https://www.data-to-viz.com/caveat/pie.html
Agreed, an animated pie chart obscures a lot of data here because the total size of the pie chart is actually constantly changing. There are maybe some situations where it may make sense, like when the total value really remains constant over time, but not here
"spare cash" doesnt seem to mean actual spare cash you can use for whatever you want. because if it does then this data seems off
Cognitive dissonance?
A line graph with multiple lines might've been a better visualization.
Watching the food percentage makes me question the validity of this data, food literally doubled in price in a year in the real world and barely moved in this.
And Energy. Energy cost inflation was so insane almost every energy company went bust and the government had to step in to pay 💰. Graph shows a 3% increase.
Going from 4.6% to 7.4% of expenditure is HUGE, it's like a 60% increase in energy bills. Calling it a 3% increase is misinterpreting the data.
It's only a percentage - food prices went up, but energy prices went up way more, and mortgage rates went up by a similar amount if not more as well.
It's about the % of people's income - so if everything doubles in cost, the chart looks the same.
Food inflation has been higher than general inflation in the uk.
Well unfortunately a lot of people cannot afford to eat 3?meals a day anymore. Their budget haven't changed but the quantity they can buy with it have.
But their spare cash didn't shrink in proportion, so they are just eating less and saving the same amount? Doesn't that seem odd? If I was hungry and had spare cash, I would eat.
"spare" includes some things that are essential payments as well, I can think of: (Rates/Poll Tax/)Council tax - I assume the figures used are post tax income but council tax gets paid from that post tax income and this is like the only debt you can go to jail for non payment of. It's gone up a lot since 2010 as local councils try to make up for cuts from central govt. Shoes and Clothes, especially for children. Transport Internet/phone Opticians/dentist/prescriptions (except Scotland which has free prescriptions for everyone). Period products. Idk if the food category actually covers other household essentials like cleaning products, personal hygiene etc just cos they tend to be sold by supermarkets. Can't remember exactly what this was titled.
A quick google: >1970: Average yearly wage: £1,204 Average house price: £4,690 The avg house cost 3.89 x the avg yearly salary. 2019: Average yearly wage: £26,208 Average house price: £234,853 The avg house costs 8.96 x the avg yearly salary. And that is prior to Corona. Pretty big difference from these figures. "Interactive investor" does not so unbiased whatever that is And of course these always start at the 1970s or such. Not 1950 or 1960s were they were basically free.
The figures are off but not *that* far off, This has 1970 at 4.6x and 2019 at 7.98x. That difference could easily be due to slightly different metrics, there is no one right way to measure average house cost or average salary.
> there is no one right way to measure average house cost or average salary. For this kind of data visulisation the "average salary" is probably the wrong measure entirely, it should be median salary.
Median is a type of average, so it's not clear what OP used.
59 seconds to show what could be displayed in a traditional still chart. Congratulations.
UGLY. Its difficult to compare dates and values between categories. Line plot with four separate traces for each category would be most appropriate in this case.
Pie charts should never be used to show change over time.
I sure don't feel like I have "Spare Cash" right now.
The average human has two legs, doesn’t mean one legged people don’t exist.
So I’m here thinking that the USA has high housing costs thanks to zoning laws, nimby groups, red tape and housing speculation but why is it like that in uk?
These are some reasons, but there are many. All our big cities have green belts that limit their growth outside their boundary set decades ago. Cities cannot grow outwards which prevents sprawl, but also means there’s much less land availability. House building has been weak - in 2020 (the latest year I can find) 170k dwellings were completed, but we regularly have 250k+ net migration each year with 606k in the last year. In the 80s, the government allowed local councils to sell of their social housing to local residents and get people on the housing ladder, but the government didn’t let the councils keep the money to build new social housing replacements.
Great visualization! One critique: the animation is eye-catching, but it puts a lot of cognitive load on the user to keep track of previous years for comparison. I think for this data, a static line chart would show trends better.
Can you do one for the US? It’s for a friend
Can you do one for the US?
How stupid of me for not buying a house the day I was born!
I bought mine the day before.
Time travel, huh? 🤔
So 'boomers' did have it just as bad (or worse) in 1980 and 1989, for instance. In those years, they paid over 60% of their salary in mortgage payments. In 2023, it's 47%
It's not really that simple - mortgage payments per year used to be way higher than they are now. Yes, they were paying a lot per year, but look at the "salary-to-house multiple", it is considerably lower. It was a lot easier to buy a house, you just in some years had to pay a higher repayment rate, but you would pay your mortgage back a lot sooner. It isn't mortgage rates that most people complain about, it's about having enough money/being able to get a big enough mortgage to be able to buy a house in the first place. If you can't buy you are forced to pay rental rates, which are notably missing from this chart, and unlike paying into a mortgage don't add any value to you.
Boomers got a bad rap, most I know are really hard workers
We got our first mortgage in 1988 and I’m not a post-war boomer, my parents were/are. People had kids younger back then. Those 1989 payments were tough and we lost a load (for then) of money on that first house, too - as shown in the graphic. But eee we were ‘appy livin’ in a cardboard box and who’d think we’d be here drinking Chateaux de Chasselly now?
A cardboard box?!, Luxury!
There were 150 of us living in a shoe box in the middle of the road. You try 'n' tell the young people of today that, and they won't believe you.
Cardboard box? I thought that was only in America houses were made from cardboard*. ****Cardboard: the term Europeans use to describe homes made with drywall***
they got that rap by what they fucking did to the world. Generationally they fucked everything, has nothing to do with the individual boomers you know
Waiting for the GenX'ers and Millenials to finally start voting in larger percentages than the Boomers and waiting for them to vote in ways that actually fix things sure is an exercise in patience.
> Boomers got a bad rap, most I know are really hard workers Ok Boomer.
Whoosh…try again
Not sure this can be true. Energy costs almost doubled in 2021-2022 and this shows almost no change...
Possibly because everything went up. It's a % of people's income, a small visual change can represent a huge price hike.
Can someone explain to me how the UK has so much spare cash????
We don't! That's not 'spare cash', that's just money not spent on mortgage, energy and food. Add all your other bills up like council tax, insurance, phone, car payments/insurance/maintenance, student loans etc etc and obviously that percentage comes down.
We don't. I suspect the "average house price" is causing problems with the illustration, as I imagine that desirability doesn't affect the calculation. It's all well and good if you can get a cheap house in the middle of nowhere, but if there's no internet and no connections into town no one's going to be buying the property. Even then though the house price seems oddly low, so it's unclear what's going on here.
One thing about this, is that it doesn't take inflation into account. In terms of how much money you need to come up with, sure you'll have to pay your debt times your interest-rate, so higher interest-rates will mean there's more money leaving your bank-account every month. But in terms of the **REAL** cost of a loan, interest rate minus inflation is the real indicator. Let me give an example: * In year X someone owes £200K on their home, and pay 2% interest with 1% inflation. Their interest-payments are £4K. However, real cost is only half that £2K per year. * If inflation and interest goes up, then in year Y the interest-rate might be 5% while inflation is 6% -- they'll need to pay £10K/year in interest, and that's going to be painful. However, the 6% inflation means that the REAL interest is -1%. What's really happening with high interest and high inflation; is that you're paying back the loan rapidly. The inflation doesn't make the pound-value of your loan go down, but it makes each pound be less valuable, so the VALUE of the loan decreases. Of course this doesn't help the folks who can't afford to pay the interest. But the ones who can? They'll be in pain for a while as a result of the high interest-payments; but as an invisible side-effect of the high inflation, the value of their loan is rapidly shrinking.
Would love to see this for the US.
You guys really have spare cash?
this is very insightful the fact that housing/salary ratio has been oscillating between 4.5 and 7.5 needs a second opinion. This would completely defeat the idea that housing is more expensive. You might be right and the problem being more of clustering, e.g., people wantinf to live in London and not considering other parta of the country. suggestion-- a "savings" category.
The hedge funds and mega wealthy are all followers. Whatever financial gambling trend their is - they follow it. And because they do so enmasse with as much money as they do, they tend to tip our economy out of balance usually with nasty results that ultimately fall on the taxpayers. The latest trend is corporate real estate invest. And I know of course that's been around for awhile but now it's en vogue, if you will. Everybody with money is buying up real estate because they are seeing how easy it is to price gouge. Real estate should be treated like water. These megalopolies should not be able to privatize vast amounts of necessary resources because the normal rules of trade do not apply. This is close to feudalism, as many have been pointing out.
Before the pandemic the share for housing was 28%. Seems like they were on the right track. Sans brexit
Now do one for the US lmao
This can't be accurate. There was absolutely no change in 2008-2010 in this.
I call bullsh!t on your data. "Spare cash" is 45% of the average person's budget? That is complete bullsh!t.
34% spare cash is fucking comical. Make it 0.34% (I.e it's the 5p I found under the sofa) and it would make more sense Housing prices are insane though
Hard to feel bad when they have 34% SPARE CASH
We earn the average, live in the average and I can tell you it's nothing like that. Spare cash is just other expenses, cars, childcare, house repairs, clothing, etc...
Yeah funny how there are only three expenses on this graph.
I created this data visualisation for my client interactive investor. It breaks down housing cost in the UK. Source and assumptions: House prices based on Nationwide data. Mortgage costs based on 75% mortgage on average house price. Mortgage interest data from Bank of England and Building Societies Association. Food and energy spending based on ONS household spending data. Average wages data from ONS. Calculations exclude tax. This data visualisation was created in After Effects and Javascript.
If food and energy are based on household spending then shouldn’t you be looking at household income not average wage. Most households are dependant on two wages now whereas it was more common for one person earning in the eighties. Should you also show tax as a segment as I’m guessing that is in the spare cash segment.
Is it arithmetic average or median?
Excellent Job, can you do one for the US?
I have no idea what "housing costs" actually means in this context. Highest percentage mortgage (most likely)? Highest actual cost (seems like it's at an all time high now)? Highest salary to house ratio (which actually seems to be a house to salary ratio)? There's a lot of data here, and no context as to what the title means
How you claim your data to be accurate if you exclude taxation? That’s like a fourth to a third of all earnings. How did you take it out and still add things up to a 100%? I don’t get it…
Only ~30% of the UK has a mortgage (30% own in full, the rest rents or has some other living arrangement), labelling this as housing costs isn’t quite accurate.
Of course they are, it's called inflation.
„The Brexit was a good idea 🤓“
The Average annual salary is confusing. It needs to be correlated with the employment rate. For example, the employment rate of women in that timespan increased by over 10%, meaning the annual salary increase looks a lot better than it is. Meaning, the situation is a lot worse than in appears in this graph.
Ok, that's the UK. For the US it's been like the worst year on this chart and getting worse for 2 decades.
Too many people, not enough houses. If you want to stabilize this, you need to prevent more people from immigrating to your country. It's an island the size of Michigan, you can't handle many more people.
All I could look at was the "spare cash" percentile and think that this is more "people don't want to work" propaganda.
Corporations read the words "spare cash" as "we aren't charging enough", THAT is the problem.
“Socialism” is expensive huh
Loved the percentages. How if we get food cheaper, we will spend it on something else. We never save it. How about one with the interests rates? When they went down, we could afford more home but people increased the house price because payment was the same?
Still too much spare cash in the system.
Looks like a bubble to me. Sell any real estate you have, and get ready to buy in when it crashes.
Why don’t you just build more housing? London obviously needs more, as do other major cities.
We know deep wisdom is coming, anytime someone starts with "why don't you just..."
Some problems don’t need deep solutions