Jump to content
Sign in to follow this  
Robin Evans

Is debt the last taboo?

Recommended Posts

1 minute ago, Wolford6 said:

The country needs 250,000 houses to be built per annum. It's been building 100, 000 or so. House prices are high, building societies are asking for 10% deposits. Where is an early twenties couple going to get £20,000 cash deposit for a house in an average area of the country?

You can buy really cheap houses in the rustbelt, but generally in not-pleasant locations and there are fewer high-paying jobs in the private sector. In Bradford, a former bed shop has been granted planning permission for conversion into 10 (I think)  bedsitters.

Young people are getting penalised for not affording a mortgage by paying extortionate rents. If they have a mortgaage it takes too much out of their weekly nett income.

If we could resolve the housing crisis, we'd go a long way to resolving the debt crisis.

We could.

It is really easy.

Stop delierately making the economy centre on London and raise minimum standards for housing.

But, I am sure you agree that people would rather not do that.

  • Like 1

"You clearly have never met Bob8 then, he's like a veritable Bryan Ferry of RL." - Johnoco 19 Jul 2014

Share this post


Link to post
Share on other sites

Is there a case that seeing debt as the last taboo is  perhaps the wrong way round. Perhaps debt is not taboo enough?.

Thankfully I am not in debt. But that is perhaps because I would rather put food on the table or pay for energy, rather than buy an item that I cannot afford.

Consumerism is the God that advertising and the modern world has created. "We went it new and we want it now. Advertisers have succeeded in making people believe that they are failures if they cannot keep up with the Jones's.

As posted above it is easy to get in to debt but not easy to get out of it. But as some posts have shewn it can be beaten but it is not easy. The problem is it is hard and takes work. It needs a sacrifice and there isn't a quick fix and that isnt the easy answer that some people are looking for.

Edited by Bearman
  • Like 1

Ron Banks

Bears and Barrow

Share this post


Link to post
Share on other sites

Talking about debt shouldn't be a taboo.

When I bought my first house the mortgage rate was something daft like 18% with 2 young children it was hard. We got though it.

My children grew up with me moaning about APR on adverts such as Ocean finance and Wonga. They have been aware of what to look for and both save.

  • Like 1

Share this post


Link to post
Share on other sites
13 hours ago, Bearman said:

Is there a case that seeing debt as the last taboo is  perhaps the wrong way round. Perhaps debt is not taboo enough?.

Thankfully I am not in debt. But that is perhaps because I would rather put food on the table or pay for energy, rather than buy an item that I cannot afford.

Consumerism is the God that advertising and the modern world has created. "We went it new and we want it now. Advertisers have succeeded in making people believe that they are failures if they cannot keep up with the Jones's.

As posted above it is easy to get in to debt but not easy to get out of it. But as some posts have shewn it can be beaten but it is not easy. The problem is it is hard and takes work. It needs a sacrifice and there isn't a quick fix and that isnt the easy answer that some people are looking for.

The danger is that when no-one appears to be suffering the consequences of debt, the only side shown is from the adverts.


"You clearly have never met Bob8 then, he's like a veritable Bryan Ferry of RL." - Johnoco 19 Jul 2014

Share this post


Link to post
Share on other sites
On 25/01/2020 at 23:05, Red Willow said:

When I bought my first house the mortgage rate was something daft like 18% with 2 young children it was hard. We got though it.

However the amount of total debt required to buy a house and for a deposit was far less back then:

In 1970, the average weekly wage was around £32 (£1,664pa). A property could be bought in places for £4,975. A price to wage ratio of 3 years wages.

Today the equivalent (by average earnings and house prices) is wages £35,000pa but the average house price is £233,000 giving a ratio of 6.65, over twice as much in real terms. Of course the gap is far wider in certain parts of the country, London and the South West. And much larger deposits are normally needed these days, 10% usually being the minimum for a first time buyer. Plus private rents are often much higher relatively than they were back in the 70s; the monthly cost of renting a terraced house in a not that great area of Liverpool isn't that far off the cost of my mortgage on a house that is worth something like 3 times the value.

Yes there is a housing shortage, but according to George Clarke, The Great British Property Scandal: Every Empty Counts  there are something like a million unoccupied properties in this country for one reason or another. Get those back into a decent state of repair/on the market and things would be much better.

  • Like 1
  • Thanks 1

"it is a well known fact that those people who most want to rule people are, ipso facto, those least suited to do it."

Share this post


Link to post
Share on other sites

Debt hasn't been a taboo since I were a lad.

I think I've posted this before but when I needed a loan I went to the bank for a short term one. They refused me because although I owned a house  and car that I owed nothing on and pointed this out this meant nothing to them. I didn't have debt so I was gulity of debt avoidance not debt management which was necessary for them to evaluate whether I could have a loan.

This defied logic as far as I  was concerned because if you had debt you could have more so long as you were paying it back even in the most minimal sense.

Living a life where you have to have debt to be a good risk for more debt and you can keep adding to the debt you owe while still owing huge parts of the last one sounds like a recipe for disaster.

Share this post


Link to post
Share on other sites
3 hours ago, Oxford said:

Debt hasn't been a taboo since I were a lad.

I think I've posted this before but when I needed a loan I went to the bank for a short term one. They refused me because although I owned a house  and car that I owed nothing on and pointed this out this meant nothing to them. I didn't have debt so I was gulity of debt avoidance not debt management which was necessary for them to evaluate whether I could have a loan.

This defied logic as far as I  was concerned because if you had debt you could have more so long as you were paying it back even in the most minimal sense.

Living a life where you have to have debt to be a good risk for more debt and you can keep adding to the debt you owe while still owing huge parts of the last one sounds like a recipe for disaster.

No it doesn't. How can you prove to be a good borrower if you've never proven you can borrow and pay something back? Credit risk is fundamentally about maximising the number of people who borrow and pay it back properly. Why do you think they would deny you credit unless it made risk-sense to them? 

Share this post


Link to post
Share on other sites
9 minutes ago, Saint 1 said:

How can you prove to be a good borrower if you've never proven you can borrow and pay something back?

Believing this stupidity is part of the problem; I'd paid my way, owned everything and owed nothing and was considered a poor risk because of this. This was literally one of those very short bridging loans so we could get somewhere to live and we could take up jobs we'd been offered. And it was with the bank we'd been with for over two decades as a couple!

Since then I've had a credit card that I use now and again to build up their stupid vision of me as a good risk. When I use it it's paid off in total immediately so I still owe nothing and  will have paid for everything but I'm a much better risk now!

duck.gif.40e479560a5259f7fd6ba520f9df30da.gif

 

 

 

Share this post


Link to post
Share on other sites
On 27/01/2020 at 18:19, Oxford said:

Believing this stupidity is part of the problem; I'd paid my way, owned everything and owed nothing and was considered a poor risk because of this. This was literally one of those very short bridging loans so we could get somewhere to live and we could take up jobs we'd been offered. And it was with the bank we'd been with for over two decades as a couple!

Since then I've had a credit card that I use now and again to build up their stupid vision of me as a good risk. When I use it it's paid off in total immediately so I still owe nothing and  will have paid for everything but I'm a much better risk now!

There's a record of you paying for that in a way that there isn't with cash. Do you seriously believe that people would turn you down if they legitimately believed they could make money off you? People with no credit history are a significantly higher than standard risk. This is not stupidity regardless of how much you don't like it. 

Share this post


Link to post
Share on other sites
On 24/01/2020 at 20:58, Wolford6 said:

The country needs 250,000 houses to be built per annum. It's been building 100, 000 or so. House prices are high, building societies are asking for 10% deposits. Where is an early twenties couple going to get £20,000 cash deposit for a house in an average area of the country?

You can buy really cheap houses in the rustbelt, but generally in not-pleasant locations and there are fewer high-paying jobs in the private sector. In Bradford, a former bed shop has been granted planning permission for conversion into 10 (I think)  bedsitters.

Young people are getting penalised for not affording a mortgage by paying extortionate rents. If they have a mortgaage it takes too much out of their weekly nett income.

If we could resolve the housing crisis, we'd go a long way to resolving the debt crisis.

But part of this is expectations

By mums mum lived in a 2 up 2 down terrace my mum and uncle where brought up in it and when g.nan got really old she spent her last few years in it. My mum and dad were caught by the 1970 house price rises where despite him working for the GPO (telephones) and getting extra money for being the telephone guy in the local observer corps unit (got to sit in the bunker) they couldnt get a house so we lived in a residential caravan until i was 2 1/2 when we got a council flat.

My mum then split up and remarried a farmer who had a 3 bedroom semi (farm workers cottage kept when the main farmhouse was sold to provide a house for his brother and parents when father retired) we were 3 boys and 1 girl (later 4 boys) in that tiny semi with no cavity walls or central heating. I never went on a family overseas holiday EVER, in fact i cant remember us ever going away for more than a couple of days maybe a long weekend and it was always to stay with a family and kipping on bedroom floors. I worked an entire summer holidays on the farm aged 15 and was given £20 as thanks (that was in 1986)

Imagine suggesting that as normal now

Kids expect their own room (definitely in white middle class families), having to share is seen as demeaning even with a sibling of the same sex. One of my daughters team mates mum is the director of a small IT firm but she and her sister share a room as her mum wont get into more debt just for a bigger house that the girls will move out of shortly anyway. She never admits it to people as she is "ashamed" whilst a lot of the other girls who have their own rooms and go on holidays it is all on the never never

Add this together with fragmented families where both mother and father are trying to keep bedrooms for the children and you can see how the amount of bedrooms required be family seems to have risen while birthrates have actually fallen

  • Like 1

Share this post


Link to post
Share on other sites
On 27/01/2020 at 14:22, Griff9of13 said:

However the amount of total debt required to buy a house and for a deposit was far less back then:

In 1970, the average weekly wage was around £32 (£1,664pa). A property could be bought in places for £4,975. A price to wage ratio of 3 years wages.

Today the equivalent (by average earnings and house prices) is wages £35,000pa but the average house price is £233,000 giving a ratio of 6.65, over twice as much in real terms. Of course the gap is far wider in certain parts of the country, London and the South West. And much larger deposits are normally needed these days, 10% usually being the minimum for a first time buyer. Plus private rents are often much higher relatively than they were back in the 70s; the monthly cost of renting a terraced house in a not that great area of Liverpool isn't that far off the cost of my mortgage on a house that is worth something like 3 times the value.

Yes there is a housing shortage, but according to George Clarke, The Great British Property Scandal: Every Empty Counts  there are something like a million unoccupied properties in this country for one reason or another. Get those back into a decent state of repair/on the market and things would be much better.

1970 is when it went mad in sussex, my parents were gazumped 3 times and lost so much in the professional fees they had incurred my dad has never owned a house and my mum not until 15 yrs ago

Image result for house prices uk last 50 years

Share this post


Link to post
Share on other sites
On 27/01/2020 at 14:22, Griff9of13 said:

However the amount of total debt required to buy a house and for a deposit was far less back then:

In 1970, the average weekly wage was around £32 (£1,664pa). A property could be bought in places for £4,975. A price to wage ratio of 3 years wages.

Today the equivalent (by average earnings and house prices) is wages £35,000pa but the average house price is £233,000 giving a ratio of 6.65, over twice as much in real terms. Of course the gap is far wider in certain parts of the country, London and the South West. And much larger deposits are normally needed these days, 10% usually being the minimum for a first time buyer. Plus private rents are often much higher relatively than they were back in the 70s; the monthly cost of renting a terraced house in a not that great area of Liverpool isn't that far off the cost of my mortgage on a house that is worth something like 3 times the value.

Yes there is a housing shortage, but according to George Clarke, The Great British Property Scandal: Every Empty Counts  there are something like a million unoccupied properties in this country for one reason or another. Get those back into a decent state of repair/on the market and things would be much better.

It’s purely anecdotal evidence but I always think about the people who I remember on my street or the immediate area. (Council estate)

I remember a couple of guys in particular, one was a postman and the other worked in a local factory that made tractors (incredible as it might sound today, we had factories like that in Bradford)

Neither were skilled tradesmen, just ordinary Joes, no rich parents etc. But they both bought houses in a nearby ‘posh’ estate. I’d bet any money you like that an equivalent worker today couldn’t afford to do this.
Funnily enough, there was very skilled workers on my street (mates dads etc) who were more than happy to stay in a council house and had no intention whatsoever to buy a house. 

  • Like 1
  • Thanks 1

Share this post


Link to post
Share on other sites
24 minutes ago, Johnoco said:

It’s purely anecdotal evidence but I always think about the people who I remember on my street or the immediate area. (Council estate)

I remember a couple of guys in particular, one was a postman and the other worked in a local factory that made tractors (incredible as it might sound today, we had factories like that in Bradford)

Neither were skilled tradesmen, just ordinary Joes, no rich parents etc. But they both bought houses in a nearby ‘posh’ estate. I’d bet any money you like that an equivalent worker today couldn’t afford to do this.
Funnily enough, there was very skilled workers on my street (mates dads etc) who were more than happy to stay in a council house and had no intention whatsoever to buy a house. 

Yes - my dad is happy with his council house. I actually loved the little council flat i grew up in from 2 1/2 to 6 1/2 it was huge compared to the caravan and my later shared room (1 bunk bed and a zbed for 3 boys in a little room).

The only reason my mum has a house is her 3rd husband is a roofer/brickie and the local council offered a deal where people with a right to buy (she was back in a council house and could add in the 4 yrs form the early 70's) could rather than buying the house they were in use the discount against the land for a self build project on the edge of a new development. 

All 14 who got places on the scheme were skilled tradesmen who were living in council houses, all got to use their trades to build their houses around their normal work and all have made an absolute killing. I think her total cost for land and materials to build a 4 bed semi with huge double garage + workroom was £115k in about 2000 and it is now worth c£450k, they even got a conservatory done as within 3 yrs of the original build it was still VAT free.

Edited by SSoutherner

Share this post


Link to post
Share on other sites

One thing i do notice as a huge difference between north and south in this country is that on average Northern people seem to want/are able to spend more of their income on "things", drive around a similar estate in Reading and Marple and the cars are on average newer and higher spec'ed in Marple, the ladies have their hair/nails done  more often and people are out and about in pubs and bars and wearing fancier gear

I guess (and it is a total guess) that for many they can't really afford it but their is a large amount of "keeping up with the jones's " whilst down here it is not an acceptable excuse (?) to brag about how big your mortgage is and how it means you have an older car, can't afford to go on holiday etc etc.

Definitely the house price/earning ratio around here makes life far far harder than it is "up north" for those that have jobs

Share this post


Link to post
Share on other sites
47 minutes ago, Johnoco said:

It’s purely anecdotal evidence but I always think about the people who I remember on my street or the immediate area. (Council estate)

I remember a couple of guys in particular, one was a postman and the other worked in a local factory that made tractors (incredible as it might sound today, we had factories like that in Bradford)[1]

Neither were skilled tradesmen, just ordinary Joes, no rich parents etc. But they both bought houses in a nearby ‘posh’ estate. I’d bet any money you like that an equivalent worker today couldn’t afford to do this.[2]
Funnily enough, there was very skilled workers on my street (mates dads etc) who were more than happy to stay in a council house and had no intention whatsoever to buy a house. 

1. That was International Harvester I think. There was also David Brown in Huddersfield.

2. That was my parents; they didn't have a great deal of money coming in, but they spent what they had on a reasonably decent house, though it was far from posh, just a bog standard Wimpy estate house.

  • Like 1

"it is a well known fact that those people who most want to rule people are, ipso facto, those least suited to do it."

Share this post


Link to post
Share on other sites
1 hour ago, Saint 1 said:

There's a record of you paying for that in a way that there isn't with cash. Do you seriously believe that people would turn you down if they legitimately believed they could make money off you? People with no credit history are a significantly higher than standard risk. This is not stupidity regardless of how much you don't like it. 

When all the other factors are ignored it's not stupid but if we had been unable to move and take up the offers of  the jobs, and it was a bank we'd been customers with for decades ..... no you're right, it's perfectly reasonable and good practice. And I'll still never borrow anything from them because I regard them as thick as two short planks. I now don't keep my savings with them either.

 

 

Share this post


Link to post
Share on other sites
3 minutes ago, Griff9of13 said:

I’d bet any money you like that an equivalent worker today couldn’t afford to do this.[2]

That's the real crime isn't it?

Share this post


Link to post
Share on other sites
5 minutes ago, Griff9of13 said:

1. That was International Harvester I think. There was also David Brown in Huddersfield.

2. That was my parents; they didn't have a great deal of money coming in, but they spent what they had on a reasonably decent house, though it was far from posh, just a bog standard Wimpy estate house.

It was indeed International Harvesters, at its height employing about 2000 people. I actually worked on the demolition of the site when it was pulled down.....it’s now a big Morrison’s. 

  • Sad 1

Share this post


Link to post
Share on other sites
11 minutes ago, Johnoco said:

It was indeed International Harvesters, at its height employing about 2000 people. I actually worked on the demolition of the site when it was pulled down.....it’s now a big Morrison’s. 

Grew up driving b250,414,618 & 634 IH tractors on the farm. They got bought out by CASE I think

  • Thanks 1

Share this post


Link to post
Share on other sites
34 minutes ago, SSoutherner said:

Grew up driving b250,414,618 & 634 IH tractors on the farm. They got bought out by CASE I think

As did David Brown in Huddersfield.


"it is a well known fact that those people who most want to rule people are, ipso facto, those least suited to do it."

Share this post


Link to post
Share on other sites
54 minutes ago, SSoutherner said:

Grew up driving b250,414,618 & 634 IH tractors on the farm. They got bought out by CASE I think

I didn’t know that, I knew they kept a site going in Doncaster instead of Bradford though. Oddly enough the 360deg diggers used were CASE machines. 

Share this post


Link to post
Share on other sites
5 minutes ago, Johnoco said:

I didn’t know that, I knew they kept a site going in Doncaster instead of Bradford though. Oddly enough the 360deg diggers used were CASE machines. 

i wouldnt swear to it but i think the McCormick International agri business went to CASE and the construction equipement side went to someone else so i think less of a link than first appears between CASE 360's and IH tractors

We used to have a 6D that had retired to our land after it got old (mate of dads owned a small ground work contractors) learned to drive that as well, along with a trackmarshall and a wheeled bulldozer thing my dad always referred to as "the Drop"

Share this post


Link to post
Share on other sites

How did we get diverted off on to this tangent?

Isn't there a famous quote, something about the only certainty in life being debt and tractors?

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.



×
×
  • Create New...