Hacker News Reader

Comment by wildmusings | Hacker News Reader

>This is just making money off of the dire housing situation, imho, by squeezing the maximum amount of people into a building.

Could you clarify? As opposed to landlords in other cities, who house people out of the kindness of their hearts? I’m just not sure what the argument you’re making really is.

View on HN

No, it's just that the market is more realistic elsewhere. No one is squeezing 12 people into a 3-bed flat in Newcastle, because there are no people who want to live in such conditions in Newcastle - £300 a month gets you a private room with all utilities and council tax included. But if in London people pay £1000+ for just one room or similar amounts to share, then suddenly it becomes a much more lucrative market.

I realize that most landlords consider themselves as doing a service but sometimes they don't seem much different from domain squatters. It's not really a service, what would happen if they didn't exist? Everyone only buys homes for living in as needed, drastically lower prices, more innovation based businesses that actually contribute to making the world a better place?

So if you can't afford or don't want to buy a place, you shouldn't have a roof over your head?

We had a decent council housing system in the UK which provided affordable rents. That and housing cooperatives/housing associations replacing landlords would be ideal.

I agree with the person you're replying to, the vast majority of landlords don't contribute anything to society and the idea that housing is an investment should be stopped.

I was a landlord -- I bought a flat in 2007, the day later Northern Rock went bust, and 6 months later the identical flat below mine sold for 60% of the total -- I was in £60k negative equity. Fortunately I resisted the mortgage sales guy and went for a tracker, so paid very little in mortgage (The interest part was about £150pcm).

Fast forward 5 years, still £30k of negative equity, however SWMBO is pregnant so we need to move. Rented out our place, rented somewhere near Manchester, moved, then told my boss at the time I'd moved.

Over the next 4 years we rented out, and between various repairs, service charges, etc made an average £500 a year profit, patently not worth the stress - especially if the tenants had moved out. My half of the £500 a year was taxed in the final year at 60%.

So all that's left to make it 'worth' buying a house is the increase in house price, which in England has averaged about 3% pa over the last 13 years.

If you want to form a housing cooperative, nobody will stop you. If you want to live in the centre of London you're going to be spending a lot of money though - it's supply and demand. If you want to rent or buy somewhere cheap, move further away, plenty of choice to buy a house for under £100k, in some really nice places, not far from Manchester or Leeds. Don't blame the landlords though.

You’re thinking in the context of the status quo, you would be able to afford it. If you don’t want to there are friends, family, hotels. This is a hypothetical of course but I’m just posing the question of what would happen if the people who own 1000 homes (all to themselves) didn’t exist. This is only half the issue anyway, the major problem is supply constraint and I'm not going to get into that :-)

Think about where homes come from, about how do you ever move if you have to find a buyer to live in your old flat to sell it, and where do people who can't afford to buy a house live.

Germany seems to be doing way better.

Flatshares ("WG" , Wohngemeinschaft) are extremely common in Germany. For anyone under 30 living in a major city it is absolutely normal to share a flat with 1-3 other people.

For students a flatshare is normal but all Germans I know that work full-time live in their own flat. In London, living on your own after university is basically impossible (unless you live very far out).

> In London, living on your own after university is basically impossible (unless you live very far out).

Disagree, since I'm doing it right now 3 years after uni.

I'm not paid amazingly, below average salary for London but above average for the rest of the UK. However half my paycheck goes on rent. My commute is about 45 minutes by tube or 20 minutes by motorbike so it's not too far out. The trick is to find an area that's stabby enough to be cheap but hipster enough that there's decent bars in the area to help you forget. However I definitely got lucky, my rent is a few hundred pounds below market value.

> However half my paycheck goes on rent. My commute is about 45 minutes by tube or 20 minutes by motorbike so it's not too far out.

I don't know how you manages your finances but for me anything above 25% of your income going for rent is absurd. And you are not making it up in distance, either. 45 minutes by tube is a lots of time. (I assume motorbike is not a favorable option given London weather).

My choice is between living close to work, living alone, or cheap rent. I can pick two. All three if I choose to live in a room which fits no more than a single bed.

I'm counting 45 minutes tube/20 minutes motorbike as close because for London that's honestly quite good. About half of the people I know have commutes over an hour each way, at least one above two hours, and I can cut my public transport commute to 35 minutes if I time everything right. Biking is actually the favourable option but not possible if I'm drinking, and the miserable weather doesn't bother me.

I would love to cut my rent down to 25% of income but it's honestly not possible without increasing travel costs and time. Plus I work in computer security, London is one ofthe few places in the UK with any job mobility in my field.

25% for rent in London means you'll have a lot of money to spend. If you spend 25% of your salary of $2000 on rent on the countryside you'll live off $1500. If in the city you can make $5000 but spend 50%, you'll still have more, even after higher other costs in the city. Sounds like an extreme example but in the UK, London vs. countryside further North has those differences.

"A few hundred pounds below market value" makes a huge, huge difference.

If your salary is around £30,000, you'll take home around £1,900 a month after tax and student loan payments. Spending 50% on rent is already huge, spending £300 more (66%) would be madness.

Agreed: I've just looked around and it's closer to £100-200 cheaper per month, but it's hard to compare when you factor in anything more than just number of bedrooms and rough square footage. I did find out I'm paying about £100 a month more than the estimated payments on a 30 year mortgage which seems cheaper than most. I'm in the £40k range which makes it slightly less significant but not by too much.

Either way there's not a huge amount of choice in London. I had to find a room in a flatshare a few years ago and I struggled to find anything under £700 which was remotely reasonable (ie double bed, room for a desk and some floor space).

Can you fill in some actual numbers and a location here? Because that seems just atypical from this description.

Quite reluctant to give actual figures so these are fudged. Salary of £45k, rent £1.2k/month, edge of zone 2/3, tube line within one minute walk, overground and another line quite close. Can't remember what area it is and I'm god awful at estimating area but I'd say the flat is about 500sqft?

Can't give location, sorry. I've doxxed too many people before on less information.

£45k is an enormous salary, especially for someone in their 20s. 85% of the country earn less than that.

Looking at median London salaries from 2015 (which I have to hand), and assuming a 10% increase on that, you earn more than average for all but two boroughs - Tower Hamlets (i.e. docklands) and the City

[1] http://www.itv.com/news/london/2015-11-19/how-does-your-sala...

You've said elsewhere that you're in the 40k range. Median Central London Salary is ~35k, so you're actually well above average salary, even in London.

Here's one big difference: it's also common in London for people over 30.

Which in other European capitals is an age where you would more likely live with your partner and start a family, rather than live like a student.

That is because it's less focused on one city so that demand is a bit better distributed. Zoning law is also more helpful than in London, where laws prevent from building on one of the numerous golf courses in the city.

I have no interest at all in golf, but I'd like London to keep the green space it has.

London just needs to build taller. It happens, but very slowly. Middle class British people don't like anything other than houses, so compared to any German city there are very few 4-6 story apartment blocks in London.

The green belt is not about green spaces. Only 10-20% of the protected spaces are actually parks or forests. Much is unused land or agriculture. No one wants to get rid of Hampstead Heath or Richmond Park.

Reply on news.ycombinator.com