Before myself and Craig got together we both had mortgages on our homes. We both worked full time and it was just the right thing to do at that time. Time has passed and we now rent our property as a family of four, which has worked really well for us.
We have been looking into moving home in the near future but nothing is set in stone as yet. We are extremely happy where we are, but with our two little men growing up so fast, it would be lovely to have a little more room. I would love a dedicated space that I could call my own for my office, we also had a playroom at our old house, which made it so much easier to keep the boys’ bedrooms tidier.
I cannot believe just how much property prices have risen. A neighbour of ours has a lovely home that he bought in 1970 for an amazing £5000!
Back Then
Of course, in 1970 the wages were nowhere near as much as they are now which made me wonder if people really were better off financially in 1970 than we are now. In 1970 the average price for a home was just under £5000. The average wage at the time was around £38 per week or £1976 per year. So, your average house would cost you two and a half years wages. With our average wage now around £25,000 per year, the same two and a half years salary would equate to around £67,500. Compare this to an average house price of £242,286 and its plain to see just how much the house prices have increased in relation to our salaries. It’s quite an eye opener really, and probably the reason why so many people are turning to rental properties, such as those they can find on websites like HousingAnywhere, over those that they have to shell out a small fortune to buy.
So Expensive!
The other thing with interest is the variation of interest rates. Although the property market was fluid with inexpensive housing by today’s standards, borrowing money was much more expensive. Average building society mortgage rates were around 8.5% so your £5000 mortgage would see you paying £40 per month for 25 years and your house would eventually cost you £12,083. Now your average home at £242,286 costs £1,213 per month for 25 years and results in a total repayment of £364,006. So in 1970, you would pay back two and a half times the cost of your home, compared to just one and a half times now.
House prices have risen roughly 40 times since 1970. At the same rate, our average wage would be £87,700! A five-pound chicken would cost £51, a new Ford Cortina would cost you £38,000 and a pint of milk would cost you £2.60!
Do you own your own property? Or maybe renting suits you just fine?
*This is a collaborative post*
