To wonder how people are going to actually buy houses?

(391 Posts)
slatternlymother Tue 29-Jan-13 09:08:56

There's going to be a whole generation that can't, isn't there?

What about those people who rented due to circumstances/not knowing if they wanted to live there long term/work commitments etc, and then hit the wrong end of the financial crisis?

We rent, and have (luckily) really well paid jobs for our age. We are 25, and between running a car, putting DS through nursery, and just living, I doubt we'll have enough of a deposit to buy anything reasonable before we're 30. 28/29 at an absolute push. And that will be pressuring us to make a choice on where we're going to be living, but we won't be able to leave it much later because otherwise we'll be tied up in a mortgage forever.

But we are so, so lucky. Actually, it was blind luck that got us here.

And if we're struggling, how the hell is everyone else coping? Tbh, I'd happily rent all my life, but I worry about retirement age and no longer being able to pull in a decent wage.

AIBU to think that long term, more and more elderly people will have been in rented accommodation their whole lives, so when they do retire; they're going to have to fall back on the state, aren't they? To put them up in council accommodation?

Isn't this just a massive time bomb for the future?

Sorry for rambling thoughts, I just have been thinking about this quite a lot recently blush

It is going to be a mess. We are trying to buy a house, we have a 20% deposit, we are both employed but we run the business we are employed in. The lenders we have approached have all seen our company accounts which show a few years of increasing profits. We both have very good credit. We are having terrible trouble finding someone who will give us a mortgage, the choices are basically to either give up our company and work for someone else (they hate that we run it ourselves!) or give up on owning a home.

As for retirement I have a feeling that in a few decades there will be a lot of people working until they drop just to pay rent - back to the good old days eh?!

CailinDana Tue 29-Jan-13 09:21:41

The desire to own property tends to be a cultural thing - in other European countries it's perfectly normal to rent for your whole life, and rental regulations are excellent so it doesn't really make sense to take on the burden of actually owning a place and having to maintain it. Not owning property isn't the end of the world. Planning for retirement is important though, regardless of whether you own property or not.

What puts people off renting in the UK and Ireland is the fact that you can legitimately be treated like shit and it makes your situation very insecure. The government definitely needs to introduce tighter legislation to give tenants far more rights and to stop landlords screwing them over.

We bought our first house two years ago (when I was 28). We managed it by saving, getting money from DH's parents (which is very lucky for us, and not something everyone has to fall back on I realise) and being fortunate to live in a relatively cheap city, property-wise. We also chose a cheap area on top of that so our mortgage is small. Had we stayed in the south east it would have been a different story.

slatternlymother Tue 29-Jan-13 09:22:21

5dcs I agree with you.

Surely the banks will have to relax sooner or later, or prices will have to drop again or something. Because it can't go on like this.

You can't have an entire generation of people who will have to be housed by the council; it's a time bomb, surely?

slatternlymother Tue 29-Jan-13 09:23:37

cailin do people just put away more for retirement to pay their rent, or do they work for longer? That's what I don't really understand about the European situation.

CailinDana Tue 29-Jan-13 09:23:55

Slatternly - it's not possible to have an entire generation housed by the council, that's not how markets work. If there is no one buying then prices will naturally drop to a level where people can start buying again.

CailinDana Tue 29-Jan-13 09:24:33

I'm not sure slatternly. I would imagine they pay rent from pensions?

survivingwinter Tue 29-Jan-13 09:28:44

We could only buy our house because my dad gave us a huge deposit to add to our savings so we could get a mortgage. He was worried because we were about to be kicked out of our rental so the landlord could sell up. We had 2 kids at the local school so it was awful.

Renting in this country sucks - longer term tenancies for families should be available as its just not fair that a landlord can play God with your lives when you have paid your rent on time and been good tenants.

I just don't think about the longer term.. no pension and no hope of one either...

Crawling Tue 29-Jan-13 09:29:13

We bought a 3 bedroom house 5 years ago when I was 20 and dp was 24. Dp doesnt earn ridiculous amounts of money he has a good wage but its less than 30 and I dont work so it can be done.

We lived in a dive with cheap rent though so we could save up.

slatternlymother Tue 29-Jan-13 09:30:37

cailin I see what you mean, but surely by the time house prices have fallen low enough to be within reach, or deposits aren't so sky high; it's going to be too late for a lot of people. Lending gets harder as you get older.

Like I say, I would happily rent all my life because I honestly don't know where we'll settle. But I'm constantly checked on that idea, because people say it's throwing money away, and how will you pay when you get older?

RedToothBrush Tue 29-Jan-13 09:33:20

Most people now don't buy until they are over thirty, nor do they have children. Which is perhaps why you are finding it more difficult. It has been the case for a number of years. I honestly don't think its anymore of an issue than it was 10 years ago though.

Yes, its not as easy to get a mortgage especially as there aren't 100% mortgages out there anymore. But there are deals for first time buyers that are 5-10% deposit out there and more are creeping back into the market. The gap between wages and house prices has eased a bit in many places too, which will help some people (though admittedly this isn't the case everywhere). The number of first time buyers has dropped in the last 5 years but so has the number of people moving full stop as they've changed the way mortgages are sold. It should start to change in the next 18months or so, with a bit of luck (and as people have had time to save to reflect this).

TBH I think changes to the mortgage market will focus people more on saving a deposit at an earlier age and making sure they have a better credit rating as they didn't tend to before. Which is a good thing.

When I bought a number of years ago, I remember having the same debate about it being more difficult now but I think I've come to the conclusion that its always been difficult and if you want a house of your own you have to be patient and sacrifice/compromise on something. There were different problems in every decade of the last 30 or 40 years that we don't really consider (scary interest rates in the early 90s for example). I don't think we are used to doing that in our lives as we tend to get everything instantly and on demand. Hence why its even more frustrating and we get all despairing over it.

thekidsrule Tue 29-Jan-13 09:49:23

agree op

it will be the ones were the parents/relatives stump up (lucky them)

probably the baby boomers or BTL lanlords/ladys that inflated prices in the first place (well they contributed imho) will be the ones handing there kids a foot up so to speak

for the working poor they dont stand a chance

the gap will get bigger and bigger between have and have nots

nothing fair or equal about this,depressing times ahead for the normal person as always

cantspel Tue 29-Jan-13 09:58:44

Maybe people will just have to reassess what they can have.

As it stands we have been sold the lie that we can have it all. Children when we want to have them and a 3 bed house in a good area with nice new furniture in every room along with a hoilday every year, all the latest gadgets, phone contracts of £35pm sky tv at £80pm, a couple of bottles of wine a week and a meal out at least once a month.

It will be a matter of choosing what is most important to you. If you want a child in your early 20,s then maybe you cant have the house. If you want "stuff" then maybe you cant have the house.
If you dont have a child, save instead of spend then maybe you can.

wannabedreams Tue 29-Jan-13 10:01:26

OP I have said this a lot lately, round here it's 80% rented with most families struggling on a day to day basis, let alone saving for retirement people can't afford to save for next Christmas.
Scary times.....

FayeKorgasm Tue 29-Jan-13 10:07:52

It don't know how FTB's will manage.

I live in one of the most expensive areas and buying a small one bedroom flat can cost £200k. My son graduated in the summer with an economics degree and has just started his first job (phew!), however, it is going to be years before he can earn enough to get a deposit saved - he lives with us so he doesn't have rent to worry about. DH and I are going to help him with a deposit, but he has to be earning enough to run a home, not just service a mortgage. That could be a long long time!

If I had more than one DC it would be very hard to help them all.

It really is a horrific situation for a generation.

survivingwinter Tue 29-Jan-13 12:59:11

It is more difficult for this generation than it was for the boomers to buy houses - a radio 4 prog recently looked at the multiples required and the lack of disposable income to save for a deposit due to spiralling living costs now.

I often think people in their 50s and 60s blame the young for not being able to save but that's just not the case - it is simply impossible in some areas to afford a family sized property.

I think this issue will be huge in a few decades time but there is real lack of political will to deal with it (they all have their rental portfolios to think about after all hmm)

letsgomaths Tue 29-Jan-13 13:04:20

^ Exactly. Many politicians are so wealthy they don't live on the same planet as the rest of us, with DC one of the worst offenders.

Hammy02 Tue 29-Jan-13 13:10:31

YANBU. House prices where I live are around £300,000 for an average 3 bedroom house. You'd need to earn around £90k to afford to buy one and have a decent deposit. So average earners are priced out of the market.

amillionyears Tue 29-Jan-13 13:12:00

But votes will come into play at some point.
The problem is going to get worse and worse, so at some point, with thousands if not millions of votes at stake, the political parties of the day will really start to see what they can offer potential voters.

ethelb Tue 29-Jan-13 13:18:02

I wonder how I am going to continue to pay my rent tbh.

Estate agents round here recommend landlords put up prices by RPI every year (I have heard) and most people I know in London are at breaking point with their rent, including middle class professionals.

SomeBear Tue 29-Jan-13 13:24:00

I'm in my mid-thirties and I still rent. I hate it - the lack of permanence, the 3 monthly tenant inspections (which remind me of my mum checking my bedroom was tidy enough to be allowed out to play), the relentless grind of just earning enough to cover the rent, bills and essentials without any fripperies - we don't smoke, a bottle of beer is a treat at the weekend, shop at Aldi, car is 12 years old - yet we both work full-time. There just isn't the space in our budget for any sort of savings sufficient to cover a deposit on a house big enough for the 5 of us. With hindsight, I would have waited to have children.

It definitely feels like there is a widening gap between those who own and those who rent. My parents own their house outright and cannot understand why we "throw money away" on rent yet have never offered any sort of loan towards a deposit. I can't think of any of my friends who haven't had some help with getting a foot on the housing ladder.

It would be nice to see some more government help along the line of shared ownership and more social housing (and therefore more secure tenancies, which would might residents being more willing to invest in their local areas) but I doubt this will happen. Any changes had better happen soon or I will be too old to appreciate them!

SomeBear Tue 29-Jan-13 13:33:30

Meant to answer the OP's question about older people still in rented housing. My inlaws have rented all their lives as farmers. Now they are retired and rely on housing benefit to cover most of the rent as the state pension doesn't come close to covering the cost. Luckily they were working when they took the tenancy on, but we are worried that if (when) their tenancy ends they will struggle to find anywhere else to live - FiL has major mobility problems and HA bungalows / ground floor flats are rarer than hen's teeth. Not many landlords will take HB tenants.

I don't think they are unique in this situation, and with the new bedroom tax and shorter term tenancies that LAs are offering (most new tenants in our area are given 7 years) I think is potential for a big housing crisis in the over 60s.

myrubberduck Tue 29-Jan-13 13:35:32

I do wish those ( I am guessing older) posters who think that the reason that people under 30 cannot afford to buy is becasue they are spending all their money on smartphones and meals out would cop themselves on. Its utter horseshit frankly. not buying smartphones and shopping in Aldi would not in any way address the way in which rocketing property prices is seeing a huge transfer of wealth between genererations. You might as well tell a streetsweeper that if he saves up hard enough and cuts back on non essentials he will be able to afford that yacht

Take a good look at your house. Can you appreciate that you children will never ever be able to afford a house like it unless there is a sharp correction in the housing market.

Easiest way to do it
1. Reverse stamp duty so seller pays
2. CGT to be paid on all house sales and
3. End tax breaks for buy to let and increase CGT on all sales of BTL properties

But of course no govt would ever to this as it would be electoral suicide.

DialsMavis Tue 29-Jan-13 13:46:16

We can't afford to buy sad. We pay £1500 PCM in rent and earn 40k. There is just nothing left to save. Today I found out about a part ownership scheme near me, you need to be earning £52k to qualify for a 40% share in a small new build 3 bed terrace. We can't get a 2 bed as the DC are 10 and 2 (boy and girl) so its not really feasible for them to share or us to share with one of them. We can't really move out of area as its the only place DP can work & he works extremely long hours at anti social times.

forevergreek Tue 29-Jan-13 13:47:09

We rent in central London . ( need to for work as long hours), our one bed flat last sold 5 years ago for £385000. There's no way we can afford that. Especially as only one bed.

We will be looking to move and commute in a few years but it will take us that long to a) save deposit, b) adapt work so we don't need to commute 5 days as a 90/120min commute will be gruelling. Currently out jobs are only availiable in major cities.

We are hoping to find a place to renovate. The key factor for us is that we spen thousands and thousands a year on rent for a tiny place, we could easily have a 50% mortgage in a few years if we didn't pay rent

DialsMavis Tue 29-Jan-13 13:47:34

Our £1500 rent us for a small, cold house with ancient windows, boiler, kitchen and bathroom, we have already down sized as much as we can to try and save.

Onlyaphase Tue 29-Jan-13 13:48:53

There are some really thought-provoking posts on this thread and it has made me think.

I wonder how DD is ever going to buy somewhere to live without help, especially if she goes to university.

The burden of paying for higher education will only increase, tuition fees and living costs won't get smaller in 15 years time. So her 20's will be spent repaying student loans and renting somewhere. Unless she has a fantastic job, I can't see her repaying loans and saving for a deposit before she is 30, but then my advice (based on bitter experience) is to have children sooner rather than later...so then childcare costs kick in as well as everything else.

I hope we will be in a position to pay for at least some of these costs for her, and maybe help with a deposit as well, but what if we had 3 or 4 children? What are we supposed to do then, pick our favourite?

Bramshott Tue 29-Jan-13 13:51:35

Wow - I like your reversing stamp duty idea rubberduck - that would help first time buyers, but most other people would notice no difference (as they'd be paying it anyway).

StanleyLambchop Tue 29-Jan-13 14:06:59

What I can't understand is why they are building so many new houses, when mortgages are so difficult to get who is buying them? Apparently we have a shortage of supply which pushes the prices up, but then the developers build more houses and price them at such high levels that the people who need housing cannot afford them. So they are snapped up by the landlords who then charge massive amounts in rent to cover the massive price they had to pay. Its just a vicious circle!!!

These new homes need to be sold at affordable prices, but then I suppose the developers would not build them in the first place if there was not massive profit involved. I agree, its a total mess. I worry that my dc's will never be able to afford a house will never move out

BornInACrossFireHurricane Tue 29-Jan-13 14:14:27

I hate renting. Yes, I enjoy not having to pay out for a new boiler or to fix the electrics but I loathe the insecurity, especially with children.

We won't be able to buy for a very long time unfortunately.

hanahsaunt Tue 29-Jan-13 14:17:34

We've just bought having had to relocate for work and renting for just over a year. Renting was fine up to a point but I did really resent the three monthly inspections - felt a bit like being a student than a sensible family with 4 dc. We are stretched with what we have bought and despite dh being in what should be a fairly secure professional area and a 25% deposit, we struggled to get a mortgage and thought that if we were struggling what chance would our dc have and so did buy a house that has the capacity to have them stay with us in the long medium term i.e. beyond university years.

hazleweatherfieldgirldetective Tue 29-Jan-13 14:19:51

DH and I are lucky. We live in the north east where housing costs aren't ridiculous, and were able to buy ex-council in an area that might as well be private as everyone has bought their homes.

No way could we have afforded the same size house with the ridiculously large garden that we have now if we'd had to buy in a more affluent area of the country, or if we'd bought on a private housing estate.

The government is creating a time bomb for about 50 years time, but they won't see it. Those of us in our 20s are going to be receiving housing benefit/state pensions/unable to fund our own care without a shadow of a doubt.

I'm 23 and dp is 24. We are renting a room in somebody elses home, I have no clout how we are going to afford to rent or own place even when dp finishes uni in a few years, let alone save the deposit to get our own home. I'm dreading it tbh. We live in the south east which makes things a bit more expensive :/

I'm hoping beyond everything that my parents will be able to loan us some money towards a deposit as we're looking at twenty k minimum for that, which just isn't going to happen as I can't work full time and dp is trying to get a future by studying so has barely any income.

noddyholder Tue 29-Jan-13 14:34:51

I have just been 'studying' this as am hoping to volunteer for a homeless charity and it does require some 'knowledge' of the ins and outs of the financials of renting esp relating to 16-29 year olds. I have also been looking at minimum wage jobs locally/p time or full time and also tax credits and utilities etc. I haven't even scratched the surface of some of the info and I really don't see how young people are ever going to have a decent home unless things really change radically. I calculated a basic room and added council tax utilities at the lowest possible rate,mobile but no landline,travel,food etc and the minimum was £800 a month.

ethelb Tue 29-Jan-13 14:43:21

@noddy another big problem for people on low incomes is that the deposits needed to rent are high, often 1.5 months rent upfront, and fees that run to a couple of hundred on top of that. If you need to move frequently those costs add up fast (or any savings, even if people have them, get depleted fast, making you more vulnerable).

noddyholder Tue 29-Jan-13 14:50:54

Yes I know. I have spoken to a few letting agents and they are sooooo picky. The deposits etc are huge and some of them require your annual salary to be 3x the annual rent which for many is unrealistic. And even if you do manage to scrape them together once renting at the current levels you save nothing and indeed many people are living on overdrafts within 9-10 months of signing a tenancy agreement.

runningoutoftime Tue 29-Jan-13 14:52:32

We have just bought our first home and DH is 34, I'm 32. We've had no parental help but we're very lucky that DH got a well-paid job a few years out of university. His salary is well above average now, and we were able to put down a 40% deposit, but it still required compromises. We rented just a furnished room in a shared house until we bought this place rather than rent our own flat, and it's just a two-bed flat without any outside space (albeit in an expensive part of the country).

We don't have a car, and if we do have children, it will be just the one. DH has saved most of his salary since he first began working and he's never spent much on consumer goods, clothes etc. Many of his colleagues on similar salaries are still renting in shared flats, it's not uncommon at all for young professionals to do this in London.

I have a much lower salary than DH and come from a working class background - if we'd both been on this wage we wouldn't have been able to consider buying. Amongst my friends from a similar background, a few have bought but all with help from family, a higher earning partner, buying their council flat at a discount, or have moved further out to a cheaper location.

SomeBear Tue 29-Jan-13 14:58:32

That's a good point about financing care later in life, hazleweatherfieldgirldetective. If you have no large asset to sell or re-finance, what will happen to those who can no longer live in their privately rented housing independently? Rented houses cannot be adapted so easily - not many landlords will willing allow a stairlift / downstairs bathroom / wheelchair accessible doorways to be added to their properties? Care homes and sheltered accommodation are astronomically expensive and the population is getting increasingly aged.

RedToothBrush Tue 29-Jan-13 15:43:34

As it goes I'm not really much older. I'm in my 30s. We compromised and bought shared ownership after living at home (with DH) until I was in my late twenties and we moved on from there. Not the easiest or fun thing to do for several years by any stretch of the imagination.

We'd managed to save 10% deposit rather than get a 100% mortgage at the time which we could have done, as we felt it foolish have a 100% mortgage at the time as we did feel the market was likely to crash. And we took out a 35 year rather than a 25 year mortgage so it allowed us to be flexible in either sticking to the minimum payments if we were struggling financially or overpaying to build up more equity (which is what we were able to do in the end). We both had well below average incomes at the time and needed to buy in an area which isn't the cheapest due to where we both worked because we both commuted some distance in different directions.

It felt like the least risky option. We bought at the very height of the market in 2007 and our fears did prove to be correct, but the truth is you can't live your life on 'what ifs', you just have to get on with it. Hindsight is a wonderful thing.

I thought at the time and I still think, that if you are buying a house a deposit of at least 10 - 15% is very, very wise just to protect yourself but I don't think people necessarily understand why I feel like that or why having a little bit of money in the property to start with is to your advantage (Compound interest on 10k over 25 years for starters). We have friends and family who bought at the same time and didn't do this, and have had problems as a direct result.

Being risk adverse we figured we'd either have that option of buying the second half of the house at a lower price or if the value of the house went up, we'd have more equity to put into another full ownership house if we moved. We'd also have the chance to extend our investment without all the costs of moving if thats what we wanted. In the end it went down in value, but we only lost half what we would have done if we'd have owned the full property

The irony for us, is that even though we thought we were being smart, had we waited we would be much better off now (to the tune at the very least £10k even if we'd rented over that period) and it would have been just as easy, if not easier, for us to get a mortgage for the same amount as our house is now worth. Again the benefit of hindsight is a wonderful thing.

As it was we found when we were trying to buy the second half of our house, we weren't eligible for a lot of mortgages as 'second time buyers' even though it was still our technically our first house! And even fewer mortgages as there were weird restrictions as we were buying out a shared ownership property. We found we had to put down a bigger deposit than if we were first time buyers. We spoke to several banks about getting the mortgage and they did find our situation extraordinary and very surprising. It wasn't something they had experience with at all and we got turned down flat by a few who actively said, they would have taken us without hesitation if we had been first time buyers given our financial situation. All very frustrating. We had great fun sorting it all out.

I do think at the moment the situation is that if you bought in the last 10 years its actually more difficult to get a mortgage than if you are a first time buyer as there is a strong chance you will be in negative equity or lost a lot of any deposit you did put down and therefore even more stuck than first time buyers. So being on the property ladder isn't necessarily all its cracked up to be.

So this is why I do stress patience is a virtue here. It puts you in a better position in the long run; everyone thinks about it as a race to get onto the property ladder and I really don't think it is. We saved a deposit at a time when you didn't need to because we felt it gave us that security we wanted in such a big investment. I do think you have to take years to plan and do it unfortunately.

The thing is the market is highly unlikely to start accelerating upwards any time soon in most places, so its a good period to be saving for a deposit. The biggest thing is finding a way to compromise so you can do that. Whether that be to live at home or rent somewhere cheaper and not as nice as you'd live.

All that said, I will admit it is virtually impossible to buy on a single income or in the SE/London though and I don't envy anyone trying to do so.

forevergreek Tue 29-Jan-13 16:03:11

The problem is that in London/ south east everything is so expensive and ATM everyone wants 25% deposit. So on a £200000 house ( not that you can find any), you need min £50k deposit

amillionyears Tue 29-Jan-13 16:06:39

This may be a silly question, and one that I knew the answer to 3 or 4 years ago, but why are the mortgages lenders asking for a 25% deposit?
It used to be 10% didnt it, not so long ago? Or even 0%.

ethelb Tue 29-Jan-13 16:14:26

@amillion because not asking for a big deposit meant a higher risk, which is why the international markets crashed. Or something grin

Yfronts Tue 29-Jan-13 16:21:29

I first bought when in 2000 and paid a deposit of 5k. I managed to save 5k over the course of 6 months living at my parents house. I paid them 30 pounds, gave myself 30 for bus fares/basics and put everything else into a bank account each week. I was very very lucky!

I plan to allow my kids to live with us and save also. 50k deposit would be quite a few years of hard earning.

I know lots of other people don't have this option.

amillionyears Tue 29-Jan-13 16:30:30

grin

The cynical me is thinking.
The banks and other financial institutions in this country get bailed out by the Gov if they get into financial difficulties - the Gov "prints" money, by letting the banks add on a few 000's to all their balance sheets.
And for some reason, which I have yet to fathom, it doesn't seem to stoke inflation.

So..it isnt all the world if only say a 10% deposit was asked for. Yes, there may be a few more people who then had a mortgage but couldnt keep up with it. But I dont think there would be a huge number, and if there was, well the Gov is always at the ready to do a bit more printing.

amillionyears Tue 29-Jan-13 16:32:33

Forgot to add the cynical part.
At the moment, only the quite well off of the young can get the 25% deposit.
Is there a political reason for that?

TheFallenNinja Tue 29-Jan-13 16:32:36

Renting in the UK is shit, you get treated like a pauper when you go to an agent and landlords take the "lord" part all too literally.

You get nothing for your money and repairs take an age. It's a ball ache having to ask for something as simple as a satellite dish to be fitted without some debate or piss arsing around waiting for a decision and don't get me started on if you have pets.

It's wank over here. Massive deposits ridiculous checks including bank statements from forever ago.

ComposHat Tue 29-Jan-13 16:41:01

*This may be a silly question, and one that I knew the answer to 3 or 4 years ago, but why are the mortgages lenders asking for a 25% deposit?
It used to be 10% didnt it, not so long ago? Or even 0%*

Because everyone, Banks included, were seduced by the myth that property prices would keep on going up and up and up. So there was no need to ask for a large deposit, as in the worst case scenario they could repossess the house and they could sell it for more than the debt they were owed. Of course they were fuelling this boom with wreckless lending to anyone who asked for a mortgage. They were even offering 125% mortgages at one stage.

Except of course it was a fools paradise and property prices outside the South East have been in a slow decline for about half a decade, the banks are shit scared that if the owner can't keep up payments they could end up repossessing a house that is less than the value of the mortgage. So they insist on a hefty deposit to ensure that they aren't left in the shit.

chickensarmpit Tue 29-Jan-13 16:44:59

The amount of houses that are snapped by btl owners in area is pathetic. As soon as a house pops up for sale it's gone. Young families aren't getting a look in and that's not fair. Many houses in my friends street are owned by the same man from London. He buys them, gives them a lick of paint then rents them out at stupid prices. Why? It's just pure greed. I live in a small village and my generation have bean out priced by these btl who are just after a quick buck. Something needs to be done about this now. A home is to nest, not to invest!

amillionyears Tue 29-Jan-13 16:45:56

Thanks for that Compos.
So really, large deposits are here to say for the forseeable?
Beacuse, personally, I cant see house prices generally on the rise for another 5 years.

chickensarmpit Tue 29-Jan-13 16:47:55

Don't get me started on homes under the hammer on bbc1. That program angers me.

MoodyDidIt Tue 29-Jan-13 16:50:06

yanbu i really worry about my dc sad

RedToothBrush Tue 29-Jan-13 16:50:21

Some lenders ARE doing 5% first time buyer special rates. They are rare, but there were quite a few about last year at 10% rates. Obviously that does depend on your credit history, but they are available. We managed to get a 15% rate last year as a second time buyer - from a high street name.

Re Why: Because more deposit = less risk to the lender. Its basically a consequence of Northern Rock doing too many 100% mortgages to risky borrowers. There were too many people who couldn't afford repayment and when the price of property started to drop, if they defaulted there wasn't enough money in the property to repay the loan to the bank. Northern Rock ended up in a situation where it was owed more then it could get back so was insolvent.

Now lenders are only allowed to lend so much for every pound they have in savings. So that if the worst should happen, the banks won't collapse and will stay solvent.

So they are more strict on who they lend to, and need mortgage borrowers to have a certain amount of equity in the property, so if prices drop they can still recoup the amount they lent if you default.

Its a good idea as it protects everyone from an unstable market and it means you have more security yourself as, you gradually always are paying off your loan so in a stable or gradually increasing market gain equity. And even in a slightly declining market you should still maintain the equity you already had in the property - thus making you much more unlikely to become in negative equity.

The trouble is, it will take several more years for the new system to catch up with the drop in house prices and the introduction of minimum deposits, so its leaving people who bought most recently in a situation where they are in negative equity and prevented from remortgaging. It will catch up, but it will take time for people to save (or in fact repay) enough to get to that point.

When we do, the market should be a safer all round and not likely to have a repeat of what happened in 2008.

A few 100% mortgages are starting to reappear for a very select number of first time buyers because its cut so many people out; but I personally don't think this is really a good idea especially since the rates are at least 6/7%+ so are very expensive compared to 20% deposits which start at closer to 3% and because its going back to exactly the same problem which caused the issue in the first place.

There does have to be some room in the system to allow for a negative market rather than a positive market. We all sat pretty in the expectation that house prices would always continue to increase at a steady rate which was totally ridiculous given average incomes and thats why no one planned on a crash.

LayMizzRarb Tue 29-Jan-13 16:51:40

To get something you really want, you have to make sacrifices. My DP's moved an hour out of London where house prices were cheaper. My dad had 20 hours of commuting We didn't have a forgein in holiday until I was 14.
We didn't have lavish Christmas and birthday gifts.
When DH and I saved to buy we lived in a crummy flat, did not have a holiday in 3 years. We had friends round once A month and would buy a couple of bottles of wine and had a home cooked casserole. They would do the same in turn.
It would have been so easy to say oh sod it, lets just have one takeaway/day out, but we had to keep up taking packed lunches etc to work etc for a couple of years.
I was talking to some of the younger people at work who moaned about renting. I told them how they could do it, but they were aghast at the idea of not on going on holiday for a few years, and when I said have have your friends round instead of blowing £100 on a Friday night they thought I was prehistoric.
To suggest they move out London and add 30 minutes to their commute was met with laughter.
I know everyone's situation is different, but to younger people like those I work with - you make choices, and you alone are responsible for your choices. You can do it, but you have to sacrifice somewhere along he line...

noddyholder Tue 29-Jan-13 16:58:34

If the bank demands a high deposit it means they are covered by any downturn up to the value of the deposit.If you buy for 100k and they have 25% deposit it means if you default and they have t0 sell it they only need to get 75k to cover their costs

noddyholder Tue 29-Jan-13 16:59:57

Most 5% mortgages require a guarantor. Post uni students are mostly living at home I know quite a few and most of my friends are expecting this and adapting their homes accordingly.

crypes Tue 29-Jan-13 17:00:56

I really feel the economy wont take off again until people are able to get mortgages much more easily i.e a lower deposit. I really feel that the government cant side step this issue because its part of our culture to own our own homes and it gives the feelgood factor and people like working hard to pay for their own home. Also there are so many industries that benefit like d.i.y and home furnishing and extensions which keep the economy going. So people will continue to feel gloomy about the economy and wont be able to spend money on home ownership.

noddyholder Tue 29-Jan-13 17:08:13

If prices fall deposits will be lower. This is really the only way as the credit crunch and all that implied is still very fresh in the banks minds and loose lending is over

amillionyears Tue 29-Jan-13 17:11:14

That is one of the advantages that I can see, noddyholder of living in the expensive SE. You can, if you want to, have your offspring still living at home to cut down on expenses, and they can still commute to the London area, for the higher paid jobs.

RedToothBrush Tue 29-Jan-13 17:14:00

Theres certainly a few new builds that also offer deals at 5% noddy - I don't think all these require a guarantor.

And a quick google tells me there are a few none high street lenders who are advertising 100% mortgages (and over 100% mortgages which include stamp duty and legal fees) seemingly without a guarantor to people with less than perfect credit ratings. I wouldn't touch any of them with a barge pole. I can only assume they are managing to do it, by charging huge fees and interest. They give me the same feeling as pay day lenders give me.

Much much safer and financially sound to save for longer to go with a bank or building society who are familiar than get take one out if you ask me.

ComposHat Tue 29-Jan-13 17:14:53

I was talking to some of the younger people at work who moaned about renting. I told them how they could do it, but they were aghast at the idea of not on going on holiday for a few years, and when I said have have your friends round instead of blowing £100 on a Friday night they thought I was prehistoric.To suggest they move out London and add 30 minutes to their commute was met with laughter. I know everyone's situation is different, but to younger people like those I work with - you make choices, and you alone are responsible for your choices.

I hate to say it, but that is typical of the complacancy of the older home owning generation - 'we did it, you should do the same.'

Utterly neglecting the fact that when they bought, property prices weren't completely out of sync with earnings.

Ignoring the fact that on top of the astronomic asking prices, the deposit required is huge, so even a lifetime of homemade casaroles and thriftiness will never be enough)

Didn't have to pay sky high rents thanks to succesive governments deregualting the rental sector. So every penny was sucked into keeping (some else's) roof over their head.

Even if they were prepared to move 30 minutes out, they would have to meet the increased transport costs which have gone up and up over the last few years.

And you wondered why they laughed LayMizz?

Those born after the war and before the mid 1970s won a genetic lottery and have benefitted at the expense of those younger than them. I don't resent that particualrly, but do when you get ill-informed comments like this.

Realisitically the only chance I will get to own a home of my own is when my baby-boomer parents die, which I hope won't be for many years yet and I count myself one of the lucky ones, whose parents have a house to leave.

noddyholder Tue 29-Jan-13 17:16:16

I agree my ds is hopefully going to university this year but a lot of my friends already have some dcs back after degrees and not one has left home and there seems to be no sign of them doing so. The one I know in London is the only one to have had a job straight out of uni and it was in central london and not badly paid but he was 'let go' at xmas (that was the deal) and even though at a push and with no other life he could have afforded a room somewhere none of his friends could join him!

MoodyDidIt Tue 29-Jan-13 17:19:53

*I hate to say it, but that is typical of the complacancy of the older home owning generation - 'we did it, you should do the same.'

Utterly neglecting the fact that when they bought, property prices weren't completely out of sync with earnings.*

yep this is my parents attitude

they think i have "failed" as i am <gasp> renting and...on a council estate

fucks me right off sad

ethelb Tue 29-Jan-13 17:20:55

@laymizz I tried living outside of London and the commute was fine, but it cost as much as the rent saving. Down to the £10. Makes you wonder if it is deliberate? hmm

WhataSook Tue 29-Jan-13 17:27:32

compos its the 'poor me generation' that is out of synch. My parents did do it hard to get their home, they had children younger and less salary, but still managed.

It's all the bullshit must-haves that my generation saddle themselves with, iphone, ipod, sky, flat screen tv, car, fashion, working holidays for a year, and my favourite, having to buy a house in a desirable area, 3 bed, fantastic schools and as FBT!

lljkk Tue 29-Jan-13 17:27:57

Lots of people who will buy because they inherit from their parents, the parents & grandparents who benefited from easier environment to buy in decades before. I don't think a whole generation will be shut out, existing wealth in property will get passed down somehow.

noddyholder Tue 29-Jan-13 17:31:53

Existing wealth will get passed down but that doesn't help people now. If my dp and I live for at least another 30-40 years my ds will be 40-50 and may already have grown teenagers by the time we croak!

meddie Tue 29-Jan-13 17:33:54

You cant really rely on inheriting your parents property.
My nanas house will be used to pay her care fares. My Aunt who's in her 80's and childless has had to sell her home to fund her care fees.
My mums house is probably the only one that would be passed on as its unlikely she would go into care.
Whether my kids would see anything out of mine or whether it too would be used to care for me in my old age (they both work away) is also in doubt.
So even that avenue is now closed to a lot of families.

jamdonut Tue 29-Jan-13 17:35:58

Just want to say Shared Ownership is NOT great. We bought a 50% shared ownership flat back in October 1989...just as the last huge crash happened. Then we were in negative equity for 13 years!!!
We needed to move because I had (accidently blush) had a third child and the flat was only a tiny two bedroom one. There was no way we could buy in the area we were in (West Hertfordshire) because house prices had suddenly shot up! We didn't want to rent, so we ended up moving 250 miles away to an area with very low house prices. Luckily we are happy here, and with a small mortgage, but there is not much in the way of good jobs here so we are not hugely better off as such. We muddle through.Somehow.

noddyholder Tue 29-Jan-13 17:36:23

The elderly care thing is a huge factor in this and I think is going to become more so as time goes on.

amicissimma Tue 29-Jan-13 17:38:16

I think the worry about buying is comparatively recent.

My dad was 50 before my parents bought their first place. Till then we lived, like many other families, in rooms in someone else's house.

DH and I didn't buy until our 30s. That felt normal. We didn't want to buy in our 20s ( not that we could afford it) because we wanted to be able to move at short notice in response to the demands of the job market. To get a mortgage we had to show evidence of several years savings and only one salary was taken into account in case the other was lost to either being a SAHP or childcare costs.

I think one of the problems is that a lot of younger people bought in the 90s & 00s with squillion % mortgages, so more people than previously were chasing the housing stock. (Plus population growth and an increase in single-adult households)

havingastress Tue 29-Jan-13 17:38:48

I don't think you can do it now without significant handouts from your parents (or them allowing you to live with them rent-free whilst you save up, same thing whichever way you look at it!)

We're just selling our place and moving to rented. We've already lost £45k on the property and prices are going down and down. We can't take the risk of going into negative equity as we have a baby, and we live in an apartment. We just can't live in a top floor apartment with no lift with kids indefinitely!

We will walk away with about £15k. Given that we've spent £48k on mortgage over the last 8 yrs and put £50k deposit down, it's fair to say that it's not just renting that is throwing money away.

God knows how we will ever afford a house. We will need at least £30k deposit and the cheapest house around here is £130k. The most mortgage we can get is £100k.

Sad times all round!

ComposHat Tue 29-Jan-13 17:41:23

Oh god whatasook I wondered how long it would be before the iPods and flat screen TVs were trotted out. What you've posted, is largely cotter.

Every TV made in the last six or seven years has been flatscreen. Cathode ray TVs can't be bought for love or money. An MP3 player costs at most £100. It is some way short of the £25,000 I'd need to get a deposit on £100,00 flat, which certainly won't buy a 3 bed or something in a desirable neigbourhood in many parts of the country.

It is unarguable that our parents generation bought in a more favourable climate. Wages were lower, but the proportionate cost of housing was too.

If you can tell me a way of saving that amount (especially as interest rates aren't keeping pace with inflation, so the value of what savings I have are diminshing month on month) whilst simultaneously handing over huge portions of my income to a baby-boomer buy to let landlord, who bought our flat 'for peanuts' in the 90s. I would be grateful beyond words.

illjkk yes it will be passed down when parents die, but most people will be into their 60s or even 70s themselves when their parents die. It also locks in inequality betwen those who inherit wealth and those who don't.

RedToothBrush Tue 29-Jan-13 17:44:28

Theres certainly a few new builds that also offer deals at 5% noddy - I don't think all these require a guarantor.

And a quick google tells me there are a few none high street lenders who are advertising 100% mortgages (and over 100% mortgages which include stamp duty and legal fees) seemingly without a guarantor to people with less than perfect credit ratings. I wouldn't touch any of them with a barge pole. I can only assume they are managing to do it, by charging huge fees and interest. They give me the same feeling as pay day lenders give me.

Much much safer and financially sound to save for longer to go with a bank or building society who are familiar than get take one out if you ask me.

ComposHat - I think there are some people for whom what you say is very true. House prices have gone up far more than wages have.

But I also think there are some people for who what LayMizz says is also utterly true though too. I can look at friends who are a similar age to me or a good few years younger (DH is younger than me and has quite a few friends who are younger than him) and I know they have an above average wage and live a lifestyle which is frankly beyond their means. They should be in a position to get on the ladder, but don't have the maturity nor will to plan to do so. Certainly lifestyle and expectation does come into this for some people. We have friends who we don't go out with as much as we would like, as we know we simply can not afford a night out on a scale they do on a regular basis. It shocks me. On the whole people only want to take on responsibility much later in life than they did 20 or 30 years ago and deliberately delay marriage and kids in favour of 'freedom' and I do think this mindset about mortgages is a reflection of something of that.

In some cases, not all.

TBH, I think the problems now lay more with rental market that needs a massive overhaul and restructuring, rather than with the mortgage and home ownership market.

Skinnywhippet Tue 29-Jan-13 17:45:09

I dont know the answer. Perhaps we just need to increase a culture of saving. The Chinese save approx. 27% of disposable income vs UK saving a mere 7% of disposable income. People can still buy houses, but the age of a first time buyer will continue to get higher.

AmberSocks Tue 29-Jan-13 17:45:16

buying a house shouldnt be seen as such a big deal,its not in a lot of other places.

RedToothBrush Tue 29-Jan-13 17:52:24

ComposHat, young people DO spend proportionally more on going out and consumer goods than their parents did.

Whilst the cost of housing has gone up and wages haven't matched there, there is also still this change in spending patterns that you can not get away from.

When they calculate what a 'living wage' is considered at, they factor in what are basic expectations. In the past holidays abroad were not seen as an essential part of that. But they now are.

What ever way you look at it, there are differences in what generations now deem as a priority and an essential part of every day living. And its important to think about that as much as other issues.

Dededum Tue 29-Jan-13 17:52:46

I am 43

About 20 years ago I was a newly qualified solicitor in the City. I bought a scruffy 2 bed flat five minutes from Liverpool Street for 95k. I earnt about 35k so very doable.

Flats in the same block now cost between 250 - 275k. As a newly qualified solicitor in the same firm I would get paid about £50k.

The salary / property multiple has gone from 1:3 to 1:5. No longer so accessible.

My generation got lucky, even more my parents generation as long as they own property.

That is before you open the conversation up to availability of jobs, the free education that My parents and I got. I could sign on during the summer holidays !

soverylucky Tue 29-Jan-13 17:55:24

The only reason I managed to buy a house was because I moved away from my family to a much, much, much cheaper area and purchased a house many would turn their nose up at. However had I been born just a few years later I understand and appreciate it would have been so much harder to buy a house. DH and I earn very good money between us, only run one car, shop at lidl etc but the house we live in doesn't reflect that at all. Someone with our level of income as a proportion to the national average 20 years ago would live in a house 100 times better than the one we do live in.
I also think that the prices in some parts of the country are crazy. I live in a very cheap area but when I compare prices round here with parts of london for example, I can't believe it.

bigkidsdidit Tue 29-Jan-13 17:56:50

This scares me. DH and j are 31, one DC one on the way. My dad has given is £40k for a deposit (I know how lucky I am) and we earn £80k between us. We want to buy before DS starts school next yeR so we can't be turfed out once he is settled.

But yesterday there was a thread in In The News linking to a telegraph article saying lenders are going to lend significantly less to parents - in some cases only 30% of what they'd lend non parents. We live in an expensive city (but left Lkndon last year thank god) and need to borrow 150-180k. Don't think there's any chance of that now and we are in a privileged position with our deposit. It's messed up.

ComposHat Tue 29-Jan-13 18:00:47

I agree Amber in principle, but because the rental market in the UK is absurdly under regulated and not set up for long term renters. Almost every place I have ever rented has been freezing cold as the landlord hasn't put in proper insulation as there's no payback for them, they don't pay the heating bills!

Even the 'good' landlords I've had don't do any maintance beyond the bare minimum whilst they have tenents in and paying rent, so the place gets shabbier and shabbier around you. For exaple where I live now, the window frames are so rotten it is like living in a wind tunnel.

I'm lucky that I don't have kids.

With the standard short-hold agreement you can be kicked out of your home with a month's notice (it has happened to me) and if you have children in school or other care commitments it can be hugely disruptive and landlords often specify 'no children' so it is doubly hard to find anything else.

I have no problem with long term renting in the UK (I don't have any choice) but it is not like palces in France and Germany where there is long term security, rent caps and an obligation on the landlord to maintain the property.

amillionyears Tue 29-Jan-13 18:03:17

Do you have a link for that please bigkidsdidit?

bigkidsdidit Tue 29-Jan-13 18:04:50

This thread

here

MewlingQuim Tue 29-Jan-13 18:06:55

I keep hearing how 'this generation won't be able to buy until they're nearly thirty shock ' and I'm confused by it.

We couldn't buy a house before we were thirty and both of us had good jobs and even then we only had a deposit because DH's grandparents had died and left us a bit of cash.

I think its always been quite normal to rent in your twenties, especially if you're single.

SaraBellumHertz Tue 29-Jan-13 18:07:45

But people are managing to buy.

This isn't a new phenomenon. I am 35, I bought my first flat in London in 2001 when prices had pretty much peaked. Property was extortionate then. And pretty much remains so now. Yet people keep on buying

ComposHat Tue 29-Jan-13 18:08:00

What ever way you look at it, there are differences in what generations now deem as a priority and an essential part of every day living. And its important to think about that as much as other issues

Yes red there probably are. Just as to my grandparents generation indoor toilets and washing machines were a luxury and something my parents generation took for granted.

I have always lived frugally. Haven't had a holiday abroad since (or of any description) since 2008, don't go out and 'blow' hundreds of pounds, shop in Aldi, Asda, H&M and Primark, have had two jobs in the past. I also have some savings. But still can't afford a deposit.

I can understand if others of my generation go out and blow their wages, saving up for a house is largely impossible, you can never save enough, it would be like trying to save up for a gold plated Rolls Royce, utterly beyond the majority of us.

ComposHat Tue 29-Jan-13 18:10:55

I bought my first flat in London in 2001 when prices had pretty much peaked.

The peak of the market was 2006/07 just before the credit crunch hit. Anyway London is a bit of micro-climate and prices have continued to rise in London and other parts of te SE (a bit) due to the sheer number of people wanting to live there.

soverylucky Tue 29-Jan-13 18:13:09

In 2001 my bf purchased her house for 130k. Nice 3 bed detached with garden in a good area. The same house sold in 2007 for 305k.
2001 was not the peak.

thekidsrule Tue 29-Jan-13 18:19:55

i was trying to explain this to my teenage son the other day

put simply

20yrs ago my house cost 50k average wage here approx 16k (i think)

NOW this house is worth 230k average wage 24k

do the maths it's evident what the problem is

amillionyears Tue 29-Jan-13 18:20:32

ComposHat, if you dont mind me asking, are you trying to get a house, with just your wages?

riverboat Tue 29-Jan-13 18:21:06

Is it really true that most people in Europe don't buy? In France where I am, certainly most professionals aspire to buy their own places, and I know a fair few people in their retirement who own both a city and a country place...

Anyway, I definitely think YANBU for not understanding how so many people buy. I don't see that I'll ever be able to own property based on my current and projected earnings. The only "saving grace" is that I'm an only child of an only child so probably eventually some money/property will be coming my way but A) it will be decades from now and B) it's hardly a good strategy to just count on that.

My DP is mortgaged to his parents. He never rented, bought a house immediately upon starting work precisely because his parents could lend him the full sum outright. Plus he is in a high paying job. In fact, lots of people who I know who bought were able to do so thanks to family help or inheritances.

bigkidsdidit Tue 29-Jan-13 18:25:38

I don't know one single person in their early thirties who has bought without help from their parents

Might be different outside big cities.

Jux Tue 29-Jan-13 18:32:04

I suspect that an awful lot of people will be buying trailers and living in permanent trailer parks. I think that's what dh and I'll have to do when dd leaves home and we downsize, if we want to have any money put away for living expenses. Forget pensions; we'll have virtually nothing from that quarter.

amillionyears Tue 29-Jan-13 18:36:03

I think LayMizzRarb has a point upthread. But I would not be the one who would have to do it.
Also, I think people can get into that mindset,and not be able to leave go of it. So that every spend from then on is analysed deeply by one or either partner.

MooMooSkit Tue 29-Jan-13 18:36:55

I don't have any chance of buying a house but tbh these rent stories, I must be quite lucky as I've always had amazing landlords! The first flat i rented near London he only visited once in two years whilst I lived there (and that was when I was moving and he wanted to sell up) he was a lovely guy and things always got repaired within a week.

Now I'm renting again, been here since april 2011 and still haven't met the landlord, he is great to, everything is repaired quickly, mind, i've never been late with rent bar once when i had some fraud on my bank account and was emptied out but i paid it only four days late and was on the phone to him every day keeping him updated. He owns lots of properties though so i feel secure here, it's a shame it's two bedrooms as i'd quite happily stay here.

There's no way i could buy though. The only way as my nan says i'll have a chance of getting a house is when she "pops her clogs" and i inherit half of her house and i hate her saying that anyway, i know she'll go one day but rather no think of that!

ComposHat Tue 29-Jan-13 19:12:24

ComposHat, if you dont mind me asking, are you trying to get a house, with just your wages?

I have a partner. We aren't trying to get a house it isn't possible on our just below average incomes.

We're not trying or even thinking about trying to get a house of our own.

Chottie Tue 29-Jan-13 19:30:24

I've been a home owner for a long (since I was 19) and it has never been easy. We had a mortgage, but no central heating, no stair carpet and no holidays for the first few years.

I'm sure I will get flamed for this, but if we couldn't afford it, we went without......

It's making your own choices......

amillionyears Tue 29-Jan-13 19:42:48

fwiw, and from what little I have seen, I have a theory. That the higher rent landlords are quicker and more eager to do repairs on their properties, than lower rent landlords. They are keener to keep their porperties in good working order.
I realise there may well be some MNetters about to tell me otherwise. smile

ComposHat Tue 29-Jan-13 19:50:05

I've never seen the link million I think it comes down to how tight-fisted the landlord is. Some see it as an affront that they should ever have to spend a farthing on maintaining their property and will huff and puff and delay any work that costs money. It is a false economy as on two or three occasions, I've left a flat as I was cheesed off with stuff not getting fixed. So they lost out on a couple of month's rent whilst they found a new tenent.

Letting agents (the tagnut on the arsehole of landlordom) can sometimes add another level of feet dragging and inompetance. I am avoiding Letting agents like the plague next time I need to find a new place.

DizzyHoneyBee Tue 29-Jan-13 19:57:44

YANBU. I am so lucky to be one of the generation that was able to buy a house - I was 22 when I bought my first home, admittedly it was tough with 15% interest rates and then massive negative equity but I can't see either of my children being able to afford a house on their own. I am just so glad that I bought a house early on as now I don't earn enough to pay a hefty mortgage or rent.

I can see it being a "choice" for some people between having children and staying in rented to be able to afford a place large enough or buying a small one bedroom place - and that in areas where they are still affordable.

lljkk Tue 29-Jan-13 20:30:44

It also locks in inequality betwen those who inherit wealth and those who don't.

Agree, but twas ever thus.

Our parents will probably help our kids to buy property, iyswim, the inheritance will skip a generation.

ethelb Tue 29-Jan-13 20:33:08

I wouldn't actually mind not buying so much (apart from the retirement issue which is a big one) if renting was a better deal in this country.

I would like to see:
cap on fees charged by estate agents
longer term tenencies but only accompanied with tenents right to end the contract with little financial repercussion (I think in Belgium three - five year tenencies are the norm with the tenant able to sever the contact after 6 months with just a three month rent penalty. I think this is sensible)
no discrimation against families with children
ability to decorate (mainly installing brackets for furniture etc) even if it includes a 'return to original state' clause
I would also like a rent cap to be considered (but realise this isn't that simple)

Oh, and I just saw a pig fly......

Essexmamma Tue 29-Jan-13 20:51:11

Haven't read the whole thread but I'm going to go against the tide here and suggest that compromising on the area you buy is sometimes an answer. Born and bred and rented in central London for years but could never have afforded to buy ( both earning under £30k) so looked to move out of town. We now live 10 mins from zone 6 and paid £130k for a 3 bed. Ex council, on a fairly run down estate but we took the decision that the the space, the inside (and a garden!) were more important than a postcode and in a few years, we'll be able to upgrade. My point is that we would never have been able to afford our ideal but did what many seem to more and more and compromise.

expatinscotland Tue 29-Jan-13 20:55:55

'What puts people off renting in the UK and Ireland is the fact that you can legitimately be treated like shit and it makes your situation very insecure. The government definitely needs to introduce tighter legislation to give tenants far more rights and to stop landlords screwing them over. '

This. The real problem is the private renting system in the UK. A scam of a system that will never be changed because the 'property developer'/BTL landlord's investment vehicle must be protected at all costs.

Because of the complete crap that private renting is, many people over-stretched themselves to obtain a mortgaged-property. Now, this house of cards is precarious because interest rates are being kept low to keep these people housed.

Therein lies the problem, the essential commodity that is shelter is seen by many in the UK solely as an investment vehicle that can only increase in value.

amillionyears Tue 29-Jan-13 21:02:37

I am not sure that people still think houses "can only increase in value".
The longer this recession goes on, the more that this era will stay etched in peoples' minds.

expatinscotland Tue 29-Jan-13 21:08:04

Many people do, amillion. You see plenty of threads on here, from people who need to sell, but can't accept that they have lost money on the house so they stay put.

treesntrees Tue 29-Jan-13 21:09:55

I do think the rules for rentals do need looking at and changing. Not just for the protection of the tennants but also for the Landlords. Idon't see anything wrong in renting for life, up to and including the fifties it was normal for people to rent. Even people in good steady jobs rented. My mother rented from the same Landlord for fifty two years and my father and most of his age group did small repairs and maintenance in their rented houses too.

MrsBW Tue 29-Jan-13 21:15:17

I can only say how I did it... not how others will.

We bought 2 years ago, so not the height of the market, but still twice the cost of what we'd have paid before the last boom.

I lived in a house share for 4 years that I hated and saved as much as I could.

I didn't go on a foreign holiday for 12 years

I moved to an area where house prices weren't crazy. I am 3 hours from my family.

I waited, despite wanting to get a 100% mortgage as I was convinced that house prices had some way to fall. Luckily it proved to be the case, although that could have gone the other way.

The thing that sealed it was I met my (now) husband who had also been saving, so we could pool money.

Crucially (and this is where a lot of my friends have it wrong), we didn't feel like we had to have the 4 bed detached immediately. We live in a modest 2 bed mid terrace in an OK (but not posh by any means) area.

We waited to get married/start a family as we wanted to own our own home first so the money went into the house.

It can be done - but it's not easy and a lot of my friends have been helped out by the bank of Mum and Dad, or bought 5 years ago in a panic and on an interest only mortgage (which I was never prepared to do).

ComposHat Tue 29-Jan-13 21:24:02

up to and including the fifties it was normal for people to rent. Even people in good steady jobs rented. My mother rented from the same Landlord for fifty two years and my father and most of his age group did small repairs and maintenance in their rented houses too

Yes and they were protected from the landlord racking up the rent when he felt like it and had security of tennure. All of which was swept away in 1988.

As things stand there is no insentive for us to undertake repairs/maintainence. If we were going to be in the same flat for 3 to 5 years and the landlord allowed we'd probably install insulation and re-decorate, but as it is, we could be flung out a month from now, so it is not worth doing. Perverely the only inseintive to improve the flat will be if we leave and the landlord needs to re let it.

EvenIfYouSeeAPoppy Tue 29-Jan-13 21:24:39

What Cailin and Expat said.
I've been living away from the UK for years now and can only shake my head at the bonkersness of the UK situation. It's not just a case of wanting to own, it seems often to be a case of own or you're fucked.

We can terminate our rental agreement without cause with 3 months' notice. Our landlord cannot terminate without just cause, and the bar is set very high. You can only really be evicted for not paying your rent, being an absolute nuisance over a prolonged period, or if your landlord or a member of their close family wants to move in (and in that case you get 6 months' notice and removal costs paid for etc.).

We can do what we want in terms of decoration, fittings etc. as long as we restore it to more or less the original state when we leave or a subsequent tenant is happy to take it as it is (usually the case).

Renting is entirely normal and not looked down upon. If you buy, you expect to stay put for life - one reason why we haven't bought. No such thing as the property ladder here.

Landlords are limited as to what rent rises they can impose. There is an absolute limit and on top of that a relative one based on the 'usual' rent for the area.

I see no earthly reason to tie myself to a property in these conditions.

amillionyears Tue 29-Jan-13 21:26:57

Can I ask 2 or 3 questiosn MrsW?

The area you live in. Is it a bit higher crimewise?
Are you still near work, or is the commute longer, or more difficult.
Are you a bit freer with spending money now, or are you both sort of locked in to being frugal?

amillionyears Tue 29-Jan-13 21:29:14

Even, in the country that you are in, are landlords happy with the situation?

TheSecondComing Tue 29-Jan-13 21:31:37

Message withdrawn at poster's request.

EvenIfYouSeeAPoppy Tue 29-Jan-13 21:31:56

Yes. Well, I expect there are some who would like to have more freedoms, but plenty of people rent property out and are happy with the situation - it's just accepted. There are also quite a few private and semi-private companies who own large numbers of houses and flats and let them out. Most of our landlords thus far (we have moved around the country quite a lot for work) have been private individuals or very small companies.

slatternlymother Tue 29-Jan-13 21:39:03

even do you mind if I ask you where you're living at the moment?

MrsBW Tue 29-Jan-13 21:46:19

amillionyears was that for me?

If so, not at all.

The area I live in isn't the prettiest, but is (touch wood) OK crime wise. I was here for a long time by myself as he worked away from home for long periods, so it was important that I felt safe on my own.

I am near work - just 11 miles away. I used to live in London and knew I wouldn't be able to buy a house there which was one (of many) factor(s) in moving and working somewhere where I could. I'm lucky in that I've found an area I love and do a job I love - the only draw back is we're 150 miles from my family and 200 from his.

We are a little freer with cash but that's because we've both had pay rises since moving here. Ironically, we are still saving quite hard, and will use the savings to buy our next home - which will be the bigger family home. But we aren't putting every spare penny away which we did do to buy this place.

FairPhyllis Tue 29-Jan-13 21:55:27

I'd like to see:

A hike in capital gains tax to stop short-term btl landlord speculation
Better tenants' rights, including long-term leases
Rent controls like in NYC
More jobs outside the SE - people have got to stop thinking they can only live in London and its commuter belt. Not going to happen until we have better growth though.
A rise in interest rates - ha! not that that is likely to happen.

expatinscotland Tue 29-Jan-13 21:58:06

'There are also quite a few private and semi-private companies who own large numbers of houses and flats and let them out. Most of our landlords thus far (we have moved around the country quite a lot for work) have been private individuals or very small companies. '

This is true in other countries where I've lived. In the US, many states discourage individuals from buying property to let with heavy taxes, and much rental housing, particularly flats, are owned by companies, some of them very large, and often run by professional property management firms.

The whole system of letting agents here, too, is a huge scam.

amillionyears Tue 29-Jan-13 21:59:54

MrsBW, sorry , got your name wrong. That is the 2nd time tonight I have done that wrong.
Thanks for that. Work flexibility, I am realiseg is fairly important. Some jobs can be done anywhere, within reason. but some jobs are very tied to say the centre of certain cities.

williaminajetfighter Tue 29-Jan-13 22:16:11

I think the situation is bad and getting worse. It's serious but not as visible as it should be. We need:
1. the market to adjust (but govt does everything it can for it not to - so as not to piss off its 2 most important constituencies and land owners: the banks and older property owners)

2. Rent controls

3. BTL seriously taxed to shit or a cap on the number of properties that an individual can buy. Yes people are still buying properties these days but its the same people!!

Can I just say that I'm 43and rented again for the first time after 15 years when I moved house this summer. What a nightmare. Expensive. Crap, shittiest dumpiest furniture possible. Treated like a child. Rental agents complete assholes doing inspections, scouting house for dirt after I left so they could charge me for cleaning. When I tried to break my 1 year contract early the agents tried to keep my 2 months deposit and charge me more to cover their ' marketing and admin fees'. When I went to their governing real estate bodies to complain about such racqueteering and excessive hidden costs. they couldn't care less. Unbelievable that such an industry can exist run by dumb 25 year old boys with no moral code.

People buy because the alternative is worse!!

KingPhilsWench Tue 29-Jan-13 22:47:43

I think it depends on the area, we have bought our house and are in our early 20s, but our 3 bed, 2 reception rooms and rather big garden cost 60k. Then around another 5k to strip it bare and turn it into our home. If we lived down south wed still be living with parents! The entire value of our house is what some need for just a deposit on a flat it's crazy

LessMissAbs Tue 29-Jan-13 22:51:46

I think it will make the UK even less socially mobile, as those who have parents with valuable homes and willing to gift/lend deposits, buy outright or even just guarantee mortgages, will be able to buy, while those in slightly better paid jobs even will become the have nots and keep renting.

I can't see much point in young, gifted people staying in the UK tbh.

expatinscotland Tue 29-Jan-13 22:53:56

'I can't see much point in young, gifted people staying in the UK tbh.'

I don't, either.

We bought last year. It's a (small) three bed terrace, ex council, and was just under £130k. We're up north. We earned £65k between us at that time and had a decent deposit of about 15%.

What baffles me is that I think we earn fairly well-we're professionals, DH works full time, I did too but am now part time with DD, we live a nice, frugal-ish but still some treats lifestyle, BUT the bank only just lent us the money, and therefore had we lived pretty much anywhere else in the country we wouldn't have been able to afford to buy the tiny little terrace that we've got.

Now, I think it's good that the banks have reduced the amount they're willing to lend. But until the house prices fall to match, what are people meant to do?

I should add, out of our friends who own houses-

3 married older men who already owned the properties
2 had the deposit paid by their parents

We're the only ones who did it 'alone' as it were, and even then we didn't really as MIL's pension made up a chunk of our deposit when she died. I am forever grateful to her but I would rather have her still alive obviously.

slatternlymother Tue 29-Jan-13 23:19:29

expat DH and I are both qualified engineers, and are seriously considering taking jobs in Germany. Long term, I don't see any other way out.

I love this country so much, but I want to be treated like a person who's money and earnings are worth something. I think we'd be able to live a lot better over there than here.

expatinscotland Tue 29-Jan-13 23:36:30

You certainly won't be treated like a scumbag for renting over there, slatternly. In your position, with your qualifications, I'd be out of here like a shot.

SaraBellumHertz Wed 30-Jan-13 04:02:33

Sorry I got the year totally wrong on my last post. I bought in 2004 - at ths point properties were over double what they had been just a year earlier. In that particular area of London there was not very much subsequent increase.

I moved to the Home Counties and bought a bigger property in 2007 - everyone said I was a fool and a crash was imminent. Prices have remained stable.

More interestingly houses are selling - so someone must be buying.

I'm not disputing that people struggle to buy property of course they did, i did - and i certainly gad to "settle" re my first place- but I'm not sure it had ever been that different - eg. in the early 80's when my parents were starting out and interest rates were 14%

williaminajetfighter Wed 30-Jan-13 06:44:52

I agree that the situation is going to force talented young people elsewhere - a brain drain of sorts.

While my DD was born here she also has a Canadian passport and although Canada lacks some of the things I like about the UK I would tell her to go there in a heartbeat!

Ps of the people I know who have bought in the last 10 years about 70% got help from parents.

lljkk Wed 30-Jan-13 07:09:13

Meh, folk love to doom-monger.

House prices in my home town (beach city, North America) are hideously more expensive than most the UK (comparable to London prices). My dad's flat, about 100 m^2 is worth maybe $1.5million. Young people still manage to buy there, too. We take it more in stride when our houses get repossessed, too.

whois Wed 30-Jan-13 07:12:38

There is a lot of 'grass is greener' on this thread.

Multiples might be higher now, but when my parents were trying to buy their first house the woman's salary wasn't taken into account.
My parents first house had an outside toilet and no bathroom (in the 70s).
Interest rates hit 15%.
Credit for new furniture etc wasn't available. Ikea and cheapo flat pack didn't exist so furnishing your home was difficult.
Money wasn't spent on holidays, phone, TV, Internet, wine, clothes etc Food shopping was from the market, meat very rare for them and clothes from charity shops.
That was NOT unusual, same story for many of their friends.
They both went on to have very good jobs and contine to trade up, but if they hadn't had an exceedingly grim few years initially then that wouldn't have been possible.

ghoulelocks Wed 30-Jan-13 08:28:40

This how dh and I did it:

Saved £4500 deposit living while in crap rental (London) over 2-3 years, age 24 bought house £45,000 in cheaper area (near home town of Wolverhampton) and rented it for mortgage cost. Sold for £64,000 age 26 after personally tarting it up on the cheap. Now just over 25K deposit once new savings in (no mobiles, car, tv etc in this time). 25% deposit on 1 bed 100k flat in rubbish part of London, age 29 last year sold for 125k, again only cheap workon it such as paint and treating damp ourselves etc. Nearly 50k deposit on 300k house and huge mortgage.

No parents, that's how we did it. It involved 6 years of second hand clothes, no contracts of any kind or car. Our choice. Now I know we were lucky to have two teaching incomes but I know a lot of my friends could save like this. Obviously many can't, but I do think a healthy chunk of those who say it's impossible to buy could go frugal and save, or even move in with family to save but they choose instead to run a car, have sky, good mobiles, holidays etc. That's fair enough, but they choose that over saving.

Obviously this post is about dual income/ no children couples who say it's impossible. I feel bloody terrified about how I'd now cope if I became a single mum of two in london, and I have a good salary.

expatinscotland Wed 30-Jan-13 08:54:24

'Meh, folk love to doom-monger.

House prices in my home town (beach city, North America) are hideously more expensive than most the UK (comparable to London prices). My dad's flat, about 100 m^2 is worth maybe $1.5million. Young people still manage to buy there, too. We take it more in stride when our houses get repossessed, too.'

The difference is that the rental system there is far more secure.

I was perfectly happy renting in N. America. Year-long leases, apartments well-run and nice, just ring office for repairs. No BTL bastard renting hovel or arsewipe letting agents. Year up, just renew lease, rent would rise, but not by ridiculous levels - no fees for that. Or move.

noddyholder Wed 30-Jan-13 09:11:46

We bought our first flat when I was 30. It was a 2 bed in lovely area (london) and ds was 2 and I was at home and it was only 2x dp's very average salary. Now 17 years on we have more savings better wages etc but we wouldn't be able to buy it! Most of my friends who are still in the houses they bought about 10 years ago couldn;t buy them now. I have just bought a flat as we are downsizing and it is an absolute wreck and is 10X average local salary plus needs about 50k spent on it. I have been renting for 15 months and it has been a nightmare damp expensive no storage and just awful.

expatinscotland Wed 30-Jan-13 09:40:30

C'mon, noddy, you know the only reason people can't buy is because they have iphones, Sky, go out and take holidays! If they just tighted up their belts, it's entirely possible.

noddyholder Wed 30-Jan-13 09:46:11

grin. Something needs to change But what? I definitely think no second homes etc with mortgages.

expatinscotland Wed 30-Jan-13 09:48:54

Tax the hell out of second homes the way they do in other countries. End BTL mortgage, it's commercial/business mortgage or nowt.

And the private rental laws need massive revision.

Pie in the sky. None of that will happen.

expatinscotland Wed 30-Jan-13 09:49:49

It's easier just to scold others who all have iPhones, Sky, take holidays and go out.

noddyholder Wed 30-Jan-13 09:53:04

You shouldn't have to give up living to put a roof over your head!

RandallPinkFloyd Wed 30-Jan-13 09:53:21

I'll never own my own home. That's not doom-mongering it's just a fact.

I'm a lone parent. I already shop at lidl, rarely eat meat, very rarely (even then it is an evening in my local pub) go out and haven't had a holiday of any description since my honeymoon in 2007. I do that just to cover the rent and bills.

I live in a very cheap area and the 2 bed terrace I live in now is only worth about £130k. However, I work in an average salary job so even if I miraculously managed to save £20k no bank would ever give me a mortgage.

I don't have family who can help and there won't be any inheritance. It's shit. I've failed my son because he'll never have a secure roof over his head.

My LL is really nice (if ineffectual) thankfully and my rent is pretty cheap but if/when they want us out I honestly don't know what will happen. The wait for any kind of LA housing is 10+ years and no private LL will look at me because my wages are topped up with benefits.

But yes, it is all my fault. If only I hadn't bought that flat screen tv from tesco three years ago for £250 I wouldn't be in this mess would I hmm

Orwellian Wed 30-Jan-13 09:53:24

There is going to be a huge generation of younger people who are forced to rent perpetually to pay for the "haves" (i.e. older generation who already got the best of all worlds - very cheap housing, free university education, generous final salary pensions etc) to keep their standard of living. We will have a society of young slaves who will probably never be able to retire (because the retirement goal posts keep being moved) in order to pay for those in their 50s/60s to retire early with a nice big property, big pension pot and all the little extra benefits they get such as winter fuel allowance.

The government is doing everything it possibly can to keep asset prices (homes) high since our whole economy is now based on the equity in houses. The Tories (and Labour) have a vested interest in keeping this divide since most mp's are either rich, own multiple properties or are landlords and they both parties get a lot of money from building companies and rich landlords tend to vote in favour of a party that keeps them rich and makes them even richer. The younger generation have no money, so basically no say and it will be pretty awful for them - forced to live in some tiny crap hole that they pay exhorbitant amounts for so that some rich landlord can keep up his/her lifestyle.

The only people able to live in London, for example, will be the very rich and those in social (subsidised) housing.

It's absolutely scandalous and a damning indictment of how morally and economically corrupt this country is.

noddyholder Wed 30-Jan-13 09:54:37

I agree tax BTL to F. I don't think holiday homes in rural communities etc should be allowed at the detriment of locals.Rentals need regulation part time half arsed landlords are everywhere.

slatternlymother Wed 30-Jan-13 10:09:07

There is a lot of 'grass is greener' on this thread.

But it was easier. No amount of budget shopping, getting charity shop clothes or not buying 'stuff' is going to get me a deposit easier.

My parents bought their 3 bed semi for £56,000 in 1992. He earned £28,000 as a teacher, she worked part time in a care home for aboout £7,000 a year.

So yes, sorry, but it was easier, because house prices were lower. If my husband and I earned more than half the cost of a 3 bed semi in a Cornish town, then we wouldn't be in this situation.

I find the notion that if the younger generation just stopped holidaying, buying flat screen TVs (as someone pointed out earlier; you can't get a cathode ray TV anymore so hmm), shopping 12 times a week in Waitrose and buying Gucci shoes, insulting frankly.

How about I take you back to the beginning, put you on the average UK wage, with 2 kids, hmm? Go on, save up a £50,000 deposit whilst you're still paying to live somewhere else. Even a total shithole will cost you £700pcm these days.

slatternlymother Wed 30-Jan-13 10:11:49

And btw, I'm not pointing out how bad things are for me, because they're not. I just think it's so easy to look back and think it was easy, when in fact, a lot of that generation were incredibly lucky.

I don't begrudge them that; good on them. But I don't appreciate being told I'm just not trying hard enough. No one here has said that, but boy, has it been insinuated in rl!

RandallPinkFloyd Wed 30-Jan-13 10:19:19

It's ok to moan slatternly, just because your situation isn't the absolute worst it could be doesn't mean it isn't shit.

If there's two if you and you both earn a decent wage you should be able to buy a house. It shouldn't be as hard as it is.

ILikeBirds Wed 30-Jan-13 10:26:58

The phone thing makes me laugh. Give up your 35 a month contract phone and in 10 years you'll have saved £4200. Not nearly enough for a deposit in most areas. Anyone claiming contract phones are a reason youngsters can't save a deposit is clearly out of touch with how much deposit is required.

RandallPinkFloyd Wed 30-Jan-13 10:57:38

I know, mine is £15! My sky/broadband is about £40. I could be rich beyond my wildest dreams hmm

In ten years that would save me precisely £5500, what prey tell is that going to buy me?

(Although how anyone can still justify calling Internet access and mobile phones a luxury I really don't know.)

RandallPinkFloyd Wed 30-Jan-13 10:59:04

I lied, it would be £6600. I think I'll go for a detached then.

slatternlymother Wed 30-Jan-13 11:14:24

grin Randall It's true though!

And does nothing to help people. It's this smug attitude you get of 'well, if you just gave up X and stopped living frivilously and buying wine...' Wine? Wine?! <hollow laugh> When actually, a lot of people were very, very lucky. If they'd just admit that!

RandallPinkFloyd Wed 30-Jan-13 11:36:17

It's infuriating but sadly the people who think like that refuse to see it from any other angle. It's almost as if they feel it devalues their struggle to admit that anyone could possibly struggle more iyswim.

(Maybe I'll tell them I just spent £400 on an iPad. That'll have them frothing all over the shop!)

noddyholder Wed 30-Jan-13 11:49:03

I think I have made more cutbacks in recent years when I am supposedly better off on paper than I ever did when I bought my first house! It really was fairly easy then.

ethelb Wed 30-Jan-13 11:53:08

My parents never saved a penny in their lives and got a 100% mortgage that was 1.5x their joint income (It was in Liverpool in the 1980s) which grew in value enough for them to be able to buy in London 5 years later. They weren't on high salaries (teacher and journo) and got all of their furniture from Habitat on credit. They sold a painting to pay for the removal van, so adverse were they to saving.

Actually you could get far more on credit (or the never never then) than you can now actually.

They are well aware that giving up a mobile phone isn't going to magic up £40k into my wallet.

RandallPinkFloyd Wed 30-Jan-13 12:20:26

That's the thing isn't it, house prices in relation to salaries.

So if two people earn minimum wage 1.5x their joint salary is about £36k. Fifteen years ago that would have bought a normal sized house where I live. In fact my sister and bil bought their 3 bed terrace for £50k ten years ago. They had to save up a £1000 deposit and similar for fees and costs.

The same house is now worth about £140k and would probably need a £20k+ deposit. Their salaries certainly haven't tripled in the same way!

expatinscotland Wed 30-Jan-13 12:23:39

Many people I know do not have a landline. They use a mobile for you know, when work needs to contact them. They even have - shock - mobile WiFi and use it for work! Such frivolity.

forevergreek Wed 30-Jan-13 12:32:05

Yup, 25% of our 1 bed flat we rent in London is £95k. I'm not sure giving up my phone will save that

expatinscotland Wed 30-Jan-13 12:40:17

And all this, 'I didn't, my parents didn't have (a microwave, an iPhone, a computer, a unicorn)'. Well, no one did because they didn't used to exist! Funny that, how times change. My great grandparents didn't have a car and they managed. No shit.

noddyholder Wed 30-Jan-13 12:45:21

I hate the current trend for always blaming people for creating the situation they are in(even if its purely a societal thing) by others who aren't in it. There is no sense of fairness or community I am truly getting sick of it.sad

slatternlymother Wed 30-Jan-13 12:54:44

My question remains though; surely there will be thousands and thousands of people who will get to retirement age without having a mortgage paid off/nearly paid off?

The government has raised the working age, but really; I cannot see people in their 70's doing investment banking, engineering, teaching, other stressful/very physical jobs. Employers will discriminate. The aged will end up either unemplyed, or in less demanding (and perhaps less well paid) jobs. It's not right, but view yourself as an employer. Even choosing between someone in their mid-50's or someone in their early-30's. It isn't right, but it's true.

So a lot of elderly people, out of work to make way for the younger generation and no means to pay for a house. The welfare state will HAVE to provide housing solutions in the form of council housing or extra benefit, surely.

That is a time bomb waiting to go off.

Plus, say you save for years and years to get a deposit; you might be 40 before you manage to get on the ladder. The average age now according to The Times is 37 for a FTB. How much longer before the banks turn these people down, or only offer them a 10-15 year mortgage?

And forevergreek shock at 25% of your flat being £95,000. That is impossible. I wonder if there is going to have to be a 'top' amount you pay based on how much you earn, and the state buys the rest that will be sold when you die/to pay your care costs.

slatternlymother Wed 30-Jan-13 12:57:36

Because at the moment, the only way we will manage to buy is by moving to Germany, saving and paying fair and reasonable rent, and then coming back to buy outright/with a small mortgage. And we are the bloody lucky ones.

I now have started worrying about how DS will manage.

noddyholder Wed 30-Jan-13 12:59:53

The flat I am buying used to be a whole huge house. I am buying the top 3 floors and there is a small flat in the basement. It was bought (the house) in 1999 for 3x average salary and now divided the top bit is 10x! The tiny basement flat would cost 4x what the whole house did! Things have risen so out of proportion to earnings people must see that. It is not a compettion as to who can make the most sacrifices to house their family! We are not talking about mansions here

NumericalMum Wed 30-Jan-13 13:04:10

I think people need to remember that most of our parents got a huge bonus from property prices (not mine as I am foreign) and that the right thing to do would be to pass this on to their children.

Similarly people need to plan. The poster whose parents lived in a rented farmhouse and now can't survive on the state pension must have realised this would happen? Did they not think to save into a private pension? Did they expect th state to give them a nice big house when they stopped working?

And yes people. If you have kids at age 20 with no savings and no deposit it will be difficult to save for a deposit! Surely people plan these things too? If you want to have your family young then accept it will be more difficult to buy a house. My parents saved and bought a house in far worse economic circumstances than these (and my dad put himself through university by working and studying at night and my mum paid their rent) and once they had a stable house etc they had us. People these days want everything now without working for it or saving for it.

noddyholder Wed 30-Jan-13 13:05:13

You cannot plan if you are literally covering your arse every month.

expatinscotland Wed 30-Jan-13 13:05:13

'Because at the moment, the only way we will manage to buy is by moving to Germany, saving and paying fair and reasonable rent, and then coming back to buy outright/with a small mortgage. And we are the bloody lucky ones.'

And you may not bother coming back. A lot of people I've known who've moved there haven't.

forevergreek Wed 30-Jan-13 13:06:10

Yes I'm not sure how pension age will work. I mean many people are still able to work at 70, but many also can't. It's really depends on both individual healthy etc as well as what job they do.

A 70 year old up scaffolding?! Surely that's unsafe

A 70 year old lawyer? Many hours may be simply too much

A 70 year old police officer? Depends on position.

We will def buy eventually but not for a few years and will need to look at a long commute ontop of long hours, so hopefully adapt work in the meantime. And hopefully then buy an average house on the commuter belt. I can't imagine having to work so hard to pay a high rent still when Im old, and would much rather have that side of things paid and sorted for

noddyholder Wed 30-Jan-13 13:07:28

Why should people move to alien areas away from the people they know and love This sort of attitude is wrong.

RandallPinkFloyd Wed 30-Jan-13 13:07:46

Tbh I don't think about the long term future. It's too overwhelming and it absolutely terrifies me. I just stick with the day to day stuff. We live one month to the next.

I don't have any kind of future, not in a security sense, this is it for me, this is how it will always be. No amount of saving or cutting back will change that.

I just have to hold on to the hope that things will change for DS's generation.

expatinscotland Wed 30-Jan-13 13:10:09

'I think people need to remember that most of our parents got a huge bonus from property prices (not mine as I am foreign) and that the right thing to do would be to pass this on to their children.'

Yes, those people can inherit, others whose parents weren't so lucky can go boil their heads.

Youngsters, nowadays! Tutt, tutt! They just want it all at once. Stupid sods.

Those are some peoples' kids your talking about, or even themselves. Generalising they are all a bunch of greedy entitled gits who want something for nothing and have no concept of hardwork or sacrifice is lazy at best, not to mention patronising.

I encourage my children to emigrate because what is their worth in a country where people demonise them for wanting a secure roof over their heads and still be able to heat it?

slatternlymother Wed 30-Jan-13 13:10:16

numerical But your parents bought in a time where your annual wages, in most circumstances, were around half or 1.5x the price of the house.

RandallPinkFloyd Wed 30-Jan-13 13:17:39

NumericalMum, do you not see any way in which circumstances can change? You honestly don't believe in luck? You think everyone's lives go according to their "plan"?

My XH, like your father, put himself through university by working part time jobs whilst I, like your mother, worked 2 jobs to pay the rent. We had started saving with a view to buying but as XH was already 42 and I was 32 we decided to have DS.

My husband then had an affair. Should I have stayed with him so I could buy a house? Oh wait, no that wouldn't work because he lost his job not long after and hasn't been able to get back into the industry since.

Stupid me, I should have planned better.

slatternlymother Wed 30-Jan-13 13:18:06

Not only that; but a lot of people are only on about buying a VERY mediocre house in an ok-ish area. I don't think many people on this thread are after a converted barn with 40 acres of land, here.

They will pay a huge price, completely over the odds in fact, to have a 2/3 bed semi with a small garden to call their own. Which will be sold anyway when they die, or even worse, if they need care home fees.

Which, if you turn this whole thread on its head; seems rather pointless. Actually, if you look at it; why should people skint themselves out to buy a house? Fuck saving; just rent a really lush house, go on all the holidays and buy all the stuff that the older generation seem to think we're buying hmm Really bloody live it up.

Then, when you hit pension age, 'give' anything of worth to your kids, get evicted from your house because you can't pay your rent and throw yourself on the mercy of the council to be housed. And they would have a duty of care to house you.

What's to stop people doing that? Because it's hardly an incentive to have your own home if the bloody thing gets sold off to pay for care home fees, is it?

ihategeorgeosborne Wed 30-Jan-13 13:25:06

The thing I find really depressing about all of this, is that no government wants to do anything to reduce house prices to acceptable levels. They must know that this is a huge issue and whole generations are being forced into miserable unhabitable hovels with extortionate rents, just to keep the land owners and baby boomers happy. How long can this go on for though? Surely, if nothing changes soon, anyone with any sense will leave this country for a better life elsewhere, then where will that leave the UK. Why can't governments think long term about everything? Why is everything about winning the next election? It's all so wrong. I guess nothing will change until the people without property out number the people with property and become the bigger voting demographic.

Mosman Wed 30-Jan-13 13:30:09

NOt whilst the Blairs own several buy to let properties they won't.
The baby boomers will die and then their properties will fall into the hands of their current 30-40 year old children hopefully.
Assuming they don't piss it all away first as mine seem to be planning to.

NumericalMum Wed 30-Jan-13 13:33:38

Slatternlymother my parents bought when interest rates were over 20%.

expat encourage your children to emigrate because of course they will be better off with higher interest rates and no NHS. When you find this utopia please tell us so we can all move there!

Randal I am sorry hour husband had an affair, but it isn't really relevant to the point. Nobody can expect life to follow a path. You tried to save and did and he was a cunt. Not the government's fault either.

Hammy02 Wed 30-Jan-13 13:43:49

I can't believe anyone thinks the problem is anything to do with people spending money on 'luxuries'. About 20 years, ago my Dad was earning around £25k, bought a house for around £50k. Mum didn't work. The house is now worth £250k. It is just a bog standard 3 bed semi. The demographic of the street is now totally different to what it was back then. The only people that can afford to live there are affluent professionals.

RandallPinkFloyd Wed 30-Jan-13 13:44:41

It's completely relevant because you're blaming the fact that I can't afford my own home on a lack of planning!

When house prices were more in proportion and mortgages were easier to get I would have been able to buy on my own. Plenty of people did.

You simply cannot argue that it isn't more difficult now.

I have one friend who bought a house on her own last year. She earns almost 40k a year, had 15k gifted by her parents, we live in a very cheap area, and she still could only buy a one bedroom flat on a deposit contribution/shared ownership scheme.

williaminajetfighter Wed 30-Jan-13 13:54:46

Back to the original question, I don't think the government is going to do much about this and certainly isn't going to build lots of council housing to accommodate older people who are struggling with rent, on verge of homelessness.

What I think will happen is that families will be pushed to accomodate older relatives and it will be assumed this will happen. In the same way that you can't get unemployment if you have savings (sorry, I think that's it) if there is evidence that you have a living relative that can take you in, the govt won't help. It's a win for the government too -- they'll be promoting 'care in the community, will reduce their burden and also spur on the construction industry building granny flats! (Must buy shares in those companies)

By the way numerica that utopia that has national health care is called Canada. Britain isn't the only one who has an NHS-model health care system!

NumericalMum Wed 30-Jan-13 14:11:54

And there is -20 weather in the winter! Not my utopia...

ComposHat Wed 30-Jan-13 14:13:12

It is quite interesting and depressing that my generation is the only one since the start of the twentieth century which will experience a lower standard of living than their parents' generation.

We earn less, paid more for our education our housing costs are higher, we will be working longer and our retirement income will be lower. The things that many of our parents generation took for granted, home ownership/decent council housing and a lengthy and comfortable retirement are unobtainable luxuries to us.

I wonder how this will happened? In part I blame the baby-boomer's selfishness. The impulse of my grandparents generation, scarred by the war and the great depression, was that their off spring should have something better. As such that post war generation have got used to having the best of everything, see at as their birthright and politicians pander to it. If this comes at the expense of their own children's futures the baby boomers seem quite happy with this.

expatinscotland Wed 30-Jan-13 14:27:41

'expat encourage your children to emigrate because of course they will be better off with higher interest rates and no NHS. When you find this utopia please tell us so we can all move there!'

You'd stay in a country for interest rates and healthcare when you're young, single and childfree?

SomeBear Wed 30-Jan-13 14:29:54

In response to NumericalMum - it's my in-laws, not my parents who are in rented housing. They never expected to be housed in a huge house by the council, but I do think they are within their rights to expect their rent to be topped up by housing benefit the same as everyone else. I have never asked about their pension plans but I'm fairly certain they didn't plan for my lovely FiL to suffer a massive stroke in his early sixties leaving him without speech and dependent on my MiL for 24 hour care. From what I've heard from my DH they earned very little from farming and life was hard for them throughout, buying a farm was always out of their reach.

Mosman Wed 30-Jan-13 14:54:59

The thing is our parents parents usually died between 60 and 70, so what do you want a good quality of life or longevity ? Because quite simply we can't have both.

expatinscotland Wed 30-Jan-13 14:57:18

This is why true, Mosman. I saw an article that of girls born today, more than ever have a life-expectancy of 100, but not with good quality. Dementia. People say rates have risen, but what's probably happen is that a lot of people died before they developed it.

RandallPinkFloyd Wed 30-Jan-13 15:04:01

Blimey Mosman that may be the most depressing thing I've ever read.

catsmother Wed 30-Jan-13 15:05:10

The lack of empathy and the rigid "black and white" opinions expressed by some on this thread (and out in society generally) is vile. Talk about "I'm alright Jack".

Do some people not have the imagination to consider, for a moment, that for some people - and this group is getting ever larger due to the current economic climate and ever increasing financial pressures - it does not matter how hard they work (if they are fortunate enough to have a job) because they will never be able to afford to buy their own home. This does not mean they're lazy, or feckless, or stupid - but that their particular skill set simply doesn't pay enough - and don't think I'm just talking about those in MW jobs. This group wouldn't just need to save a hefty deposit but they'd also have to earn enough on multiples to get a mortgage as well .... you can surely see why people become so despondant at the though of saving specifically for a house (though obviously it's always a good idea to save for the unexpected if you can) because to make up the difference between what they can get on a mortgage and the actual sale price, they'd need to save a deposit of 50% or more in many cases. And of course month on month at the moment most people's "disposable" income (if you have any at all) is being eroded by increased fuel and food (and everything else) prices.

Are some people so insular that they can't imagine many others literally have no disposable income anyway once essentials have been paid for ..... where, once you've economised as much as possible, the only scope you have for spending less is on heating and eating ? (lesser quality, lesser quantity) You cannot "cut back" indefinitely because sooner or later you find you've cut all you can.

It's surely the mark of a civilised society that its citizens have an adequate and secure roof over their heads. To "blame" everyone who can't achieve this rather than sympathise and feel angry on their behalf really does show an utter lack of basic human decency IMO.

Mosman Wed 30-Jan-13 15:17:51

Why is it depressing ? Honestly I look at some of the 80 year olds plus in surgeries being brought in by their DIL/daughters, never the sons with various ailments, usually had the entire family up half the night wailing and in pain or just confused and honestly if they were a horse you'd have some heart and shot them.
Sure there's the odd spiretly one but even then what's the actual point in just living for the sake of it?

floatinglotus Wed 30-Jan-13 15:21:49

Just adding my data point, I'm 28 & DH is 27, both uni graduates. We rent and will be renting for the forseeable future- once upon a time we both worked full time so theoretically might have been able to save up a 15% down payment by now, but I became disabled a few years ago and had to give up work completely for awhile- I'm back to work now, but only part time so we don't have much to spare now for savings.

Among our similar age friends, the only people I know who have bought since the crash are people with help from parents or money from an inheritance. We have neither, so will be renting until we are both back in full time work for several years with no emergencies. One thing that is helping though is that my MIL is about to become our landlord- not the same as having our own place, but it'll feel more like our own than renting off someone random as we'll have autonomy to decorate, etc.

Our big dilemma with housing assuming I manage to get back to work full time in the next few years will be children- we both want DC but will find it almost impossible to raise the money for a deposit if we're paying childcare or one of us gives up work. By the time we will realistically face this choice I think I'll be 32 or 33, and I'm already subfertile so it may be that we will have to choose one or the other.

expatinscotland Wed 30-Jan-13 15:28:47

I agree, Mosman.

RandallPinkFloyd Wed 30-Jan-13 15:35:20

You don't think it's depressing that you either die young, top yourself or grow old miserably?

LessMissAbs Wed 30-Jan-13 15:36:32

Well, one way round the problem would be to adopt a less blinkered planning system, less directed at big housebuilding companies.

eg if 1/3 of all new builds had to be self-build. Building standards requirements mean standards should be kept up, but people who have skills but cannot afford to get a huge mortgage might be able to afford self build, if individual plot prices were no longer unrealistically inflated due to scarcity.

It might also mean less urban blight/sprawl from the current zoning system, which in effect means only big developers with massive bugets to build large developments can get involved.

Of course, changing regulations in this country so that you now need a qualified electrician to fit a new switch cover in your own home, and effectively barring your DH who has a degree in electronics engineering to do it, is not the way forward.

LessMissAbs Wed 30-Jan-13 15:41:47

Another suggestion (and it will be very unpopular) would be to raise Inheritance Tax on inheritance from property sales, and plough it back into council house building.

Personally, I think this is fairer than increasing tax on working people's salaries to redistribute wealth.

williaminajetfighter Wed 30-Jan-13 16:01:58

Interesting ideas LessMiss. I hate the fact that Barrett Homes and the other generic building companies dominate all new housing work.

Creating soulless slums of the future with tiny windows, like there is some sort of medieval window tax. This is for another thread entirely, but why do they make the windows so small and the ceilings so low in new houses? Is it purely to save materials or is it about energy saving?!!

expatinscotland Wed 30-Jan-13 16:05:33

No. I find it reality for many, if not most. Yes, you do get the sprightly ones, but for many quality of life isn't good and the more people who live longer and longer, the more quality probably will drop. Everything has a drawback, including more and more people living longer. The whole care home and pension time bomb is example of that.

RandallPinkFloyd Wed 30-Jan-13 16:08:30

It may be reality but that doesn't make it any less depressing surely.

expatinscotland Wed 30-Jan-13 16:17:45

Get old. Die. Nope, I don't find that depressing. There are far more things in life that are truly depressing.

RandallPinkFloyd Wed 30-Jan-13 16:41:25

Mosman didn't say get old - die though.

She said, die young or suffer. Very different IMO.

expatinscotland Wed 30-Jan-13 16:45:49

Depends on what you consider old, I guess. Reality, though. There isn't an economy around that can sustain a large percentage of people till live far into advanced old age in good health not working. That's going to mean quality of life into advanced old age will likely decline for many. That's just a fact. And we're starting to see evidence of this already in our own economy.

RandallPinkFloyd Wed 30-Jan-13 16:57:47

I'm not arguing that it's not reality. I just happen to think it's not a good one.

My grandfather had a shit old age. He had a stroke at just over 70. There was no treatment modern or otherwise. He basically rotted in a care home and all his savings were used for the privilege.

My Nanna on the other hand is 86 and although obviously more frail she has a very enjoyable life. She claims nothing but her state pension as luckily their house was in joint name so she couldn't be forced to sell it.

She's no burden on anyone. If I'm lucky enough to be the same it will cost the state a fortune because I won't have my own home. Thats the reality for too many people IMO. I don't think all of us renters topping ourselves on our retirement day is the answer.

slatternlymother Wed 30-Jan-13 17:00:19

Numerical how much did your parents buy their house for if you don't mind me asking?

Because a £52,000 mortgage at 20% (I know my parents mortgage was this as they have told me; don't think they got that interest though) is £875 per month. For people bringing in around £2200 per month (just over, actually). This is manageable. Sorry, but it really is. I remember these were the days when a weekly food shop cost £35 as well.

It's no good saying that that generation weren't bloody fortunate! Because they were. Yes, interest rates were high; but house prices were lower. Much lower. There's no denying that house prices were more in line with wages.

slatternlymother Wed 30-Jan-13 17:02:46

And also; you cannot force a relative to take you in. No one can.

If you don't have your own home, and none of your family would be willing to take you in, the state cannot force that as they are not responsible for you.

There are going to be a LOT of pensioners as a burden on the state if we don't watch this.

And people need to care, because it is our children who will foot the care bill in the form of higher taxes.

noddyholder Wed 30-Jan-13 17:09:40

Also 40 somethings need to be aware that relying on an inheritance is daft. Once our parents age there will be inheritance tax which I think will rise (east target) care fees etc so there may be nothing left! And by 40/50 your kids are mostly grown and a family home doesn't have the same meaning. We need action now.

expatinscotland Wed 30-Jan-13 17:15:08

'And also; you cannot force a relative to take you in. No one can.'

And what if you've dowsized to a one-bed flat to rent or buy after your children left?

How will you take in this relative?

noddyholder Wed 30-Jan-13 17:17:17

We have downsized because of my health but we have to keep enough room for ds to live with us for the foreseeable as I don't know any university grads who aren't back at home

Jux Wed 30-Jan-13 17:22:42

Round our way, house prices have been forced up by second home owners. These are people who leave the place empty for the bulk of the year so plough very little back into the community, and have removed a property for someone local to live in too. I would like to see 500% Council Tax on those properties. Maybe more. It won't happen as it's the rich and powerful who own them.

GrimmaTheNome Wed 30-Jan-13 17:28:04

House prices need to drop until they are once more in line with wages.

amillionyears Wed 30-Jan-13 17:28:19

I know several uni grads who no longer live at home. But those are the ones who have jobs in cities, or large towns, but their families fo not live in cities or large towns.
Thought I would just say that, as some sort of balance to what noddyholder said.

slatternlymother Wed 30-Jan-13 17:33:11

Yes amillion if your family live rurally, I think as a grad you would be forced to move out/rent. Which counts for a lot of graduates, I bet.

Even worse then, because they won't be able to save much because they'll need to live close to work if their families aren't nearby.

Can't really 'plan' for that.

It's not about 'planning' and not having kids. Realistically, you either need financial help from parents, or you need to live at home for a bit during your early 20's in order to save. If your parents happen to live where you work; great. If not, you're stuffed really, aren't you?

amillionyears Wed 30-Jan-13 17:33:18

House prices have risen because they could. From the 80's onwards, many more women went out to work, so there was more money sloshing around the economy. Hence more money chasing houses, so house prices rose as they were sold to the highest bidder. Along with more credit available.

Now, not so much credit available, and finances are on the whole much tighter, so house prices have stabilised or fallen. Except in areas where there is still money sloshing around, ie places like London and holiday home places.

amillionyears Wed 30-Jan-13 17:34:42

Quite agree slatternlymother.

slatternlymother Wed 30-Jan-13 17:37:48

Not only that, but for your average situation to be comparable to the 80's; a couple would need to earn £150k between them for a mortgage on a £200k house. (Based on a lady upthread saying her parents got a 1.5x mortgage on their first home based on their wages at the time; a teacher and a journo if I remember correctly).

noddyholder Wed 30-Jan-13 17:57:26

I live in a city and its commutable to London but these grads cannot afford to commute and pay rent so they either live at home or work locally in 'any' job Mind you not many are working in anything like the sort of job where saving is an option atm.

slatternlymother Wed 30-Jan-13 18:21:49

The problem is noddy that if you work in 'any' job outside of your specialisation simply in order to save; you're losing valuable career experience and you're going to have a massive gap in your CV. A potenti employer isn't going to care that you only did it to save enough so you could live where you work. They only care about experience. Chances are, your better off peers whose parents have given them a 'leg up', are a now a few years ahead of you.

If people are talking about planning; is it bad planning if parents don't move to the same city their DC work in, in order to allow them to live at home so they can save? It's not taking it out of context. If you're going to criticise people for having children before they've secured a house (and if the average ftb age is 37; a lot of people are leaving themselves a very small window. Besides, I'm not sure I'd want to be only just getting a mortgage in my 40's; I'd have to guarantee employment until my mid 60's! What about poor health? What about redundancy? These things are more likely to happen as you get older. Not only that, but it's an aging population. The next generation has got to come from somewhere so we can all have this NHS and state welfare.), what about those who go to university from poorer backgrounds in order to give themselves a brighter future? They get themselves into debt in order to learn, and then have a huge chance of having to live away from home immediately. This has a very high chance of being renting. So 'lack of planning' doesn't come into it.

slatternlymother Wed 30-Jan-13 18:22:33

potential employer, sorry about that typo blush

StickyFloor Wed 30-Jan-13 18:27:04

I wouldn't be so foolish as to try and defend BTL landlords who rank so poorly in everyone's view, but something to consider - those of us who try and do the right thing and provide for our future in the hope that we can support ourselves in old age without having to rely on state handouts have seen pensions destroyed and devalued.

Many young professionals turn to BTL as a pension alternative, not because they are capitalist scum trying to fleece other hard-working people, but because they want to provide for their future.

Something else which I know is unpopular - posters scoff at the silliness of saving on Sky and phone contracts or whatever to save £4k or £5k over 10 years as being a ridiculous drop in the ocean. Well, if a couple both do that over 10 years, and cutback on one bottle of wine and takeaway too then they will have a 10% deposit for a £100k house. Why is that ridiculous?

It took dh and me nearly 6 years to scrape up the bare minimum deposit to buy a shithole house in a crappy area. We had no holidays, no car and put off having children and were frankly bloody miserable for much of that time, but we did it.

Someone has said that you shouldn't have to make a choice between owning the roof over your head and having a nice standard of living - of course you should have to make that choice. Why is there this sense of entitlement to own your own home and have a comfy life too?

ike1 Wed 30-Jan-13 18:37:34

I have never travelled, had kids late and am in my early 40's...that is why I have a house with no mortgage

slatternlymother Wed 30-Jan-13 18:39:33

sticky I do appreciate the 'If you can't beat them, join them idea'

And the whole deposit thing; we worked out you could save £6600 if you did what you suggested for 10 years. Even if you save £10k in 10 years, where are you going to be able to buy for that money? And you're 10 years down the line as well. 10 years ago, you could buy a 2 bed semi for that round here (well, maybe more like 12 years ago). Now, you can buy a 1 bed flat above Londis, or a park caravan and have £20k to spare. £100k doesn't really cut it. It might in some areas, but I can't imagine the wages in areas like that would be that good.

RandallPinkFloyd Wed 30-Jan-13 18:40:09

Which bank are you going to for a 90% mortgage for an FTB?

And where are you buying a house that doesn't need money spending on it for £100k?

Also I'm sure you're aware that most couples share a sky and broadband subscription so aren't exactly going to be saving £5k each.

slatternlymother Wed 30-Jan-13 18:44:33

It took dh and me nearly 6 years to scrape up the bare minimum deposit to buy a shithole house in a crappy area. We had no holidays, no car and put off having children and were frankly bloody miserable for much of that time, but we did it.

sticky now look at the other side of the coin. My argument is; what is to stop people 'living the life of luxury', renting all their lives, spending what they earn etc, then hitting the age of 65 (for argument's sake), getting evicted and then throwing themselves on the council to house them? Which they would be obliged to do? No one in your family is obligated to house you.

This is my point. I think a lot of people will do this.

noddyholder Wed 30-Jan-13 18:51:53

Most of them are working in 'any' job because there aren't many others! I have one friend whose son has excellent degree and living in London but has had to take any job and stay at home. He is one of the few of his fellow 2012 grads who have any sort of job and so he can't share with them and he isn't earning anything like enough to rent alone.As well as a shortage of homes the jobs situation isn't great either. My dp has 5-10 grads a week coming to his workplace offering to work for free.

ethelb Wed 30-Jan-13 18:55:21

@sticky FWIW I got an iPhone and have managed to start up a business on it while commuting to and from my full time work. I have broadband at home so I can work on my business in the evenings. DP needed it to freelance when he was fired from his job.

We don't have Sky, just Freeview.

I am planning to put all the profits from my business into a 'deposit fund'.

So where can I make these savings?

Plus either you do the Government's first buy scheme where you sort of only have to pay a 5% deposit, but it is on new builds which are v over priced. Or you have to find 20-40% (most commonly 25%) for a normal mortgage. The average deposit in the UK now is £40K. Your 10K comes a bit short tbh.

expatinscotland Wed 30-Jan-13 18:58:17

'Someone has said that you shouldn't have to make a choice between owning the roof over your head and having a nice standard of living - of course you should have to make that choice.'

No, she said living, because the reality for an increasing number of people is that they can live in hovels on beans and water for those same 6 years and still not have enough for a deposit because the rent on the hovel has gone up, up, up, up and their wages have stagnated or dropped.

amillionyears Wed 30-Jan-13 19:05:28

Sticky, what year did you move into your house?

noddyholder Wed 30-Jan-13 19:11:06

Cutting back on takeaways and wine is all very well if you have been having them to cut out!

StickyFloor Wed 30-Jan-13 19:26:39

I agree op that for money that will actually be a lifestyle choice - why bother struggling for something which may never be achievable when you can chose the "luxuries" and rely on the state to house you. But then there are many people who see state help as a choice not just as a fall-back position.

I fear more for those who actually really don't want to be reliant and are just priced out by house prices and mortgage companies.

Perhaps we just have to accept that house ownership is effectively a luxury now not something we can all expect in our lives. Do we just need to readjust the way we think of salaryies and income brackets vs what standard living is attainable? Despite good jobs and, on paper, good money, we will never live in a lovely house in a lovely area or have foreign holidays or actually afford to buy furniture and clothes that are not secondhand; but at least we do own the roof over our heads. So do we accept that those on lower incomes simply cannot have the luxury of home ownership anymore. Face facts, people earning £50k can no longer afford private schools for their kids, and people earning £20k can no longer afford to buy a house.

amillionyears - we bought our house in SE London in 1999 for £80,000 with a deposit of £5000 (our saving pot also covered the costs etc).

StickyFloor Wed 30-Jan-13 19:41:32

Sorry, hit before finishing and editing......... The average deposit in the Uk may be £40k but that is a really misleading stat, obviously taking account those who throw themselves into the housimg market at higher levels for assorted reasons.

There are thousands of homes around the country for £100k and under, and there are also lenders offering 90% and 95% LTV loans - they might not be as competitive, but they are there. So saying that all these people are hopelessly stuck trying to save up £40k is not totally a fair reflection.

Bowlersarm Wed 30-Jan-13 19:43:08

Is your main point, OP, that when lifetime renters get to 65 ( or whatever the retirement age is) and then don't have an income to pay their rent then what do they do? Rely on the state to house them?

It's worries me. With the way the economic climate is going there may be no public money to house them. It doesn't matter which political party is in power. It may be a question of do we give out council housing, or keep the NHS going? Or stop paying out pensions? Etc

slatternlymother Wed 30-Jan-13 20:05:28

Yes it is my point. And can I just say, that I'm not an advocate of falling back on the state by choice? I absolutely agree that it's there as a safety net, as a last resort. I'm just trying to make a point iykwim.

sticky, yes but think about the areas where you'll find a house for 100k. Are the wages going to match that? Or are they going to be low wage areas, where you'd be turned down for a mortgage anyway? And I agree, there are a number of 90% ltv products at the moment; but the bank has to think the house is worth the risk, or they will demand at least 15%. It's very hard to get a 90/95% mortgage on a non new build house, which can often be part of the condition of getting the mortgage; hence the new estates still moving apace even now.

More than likely, you will get a bit of a wreck for 100k. <outs self totally> this is what you can get for 100k around my area, where wages are amoungst the lowest in the country: this or this I don't live in either Redruth or Truro, I live within 30 minutes of both. But you get the idea.

Yes, they're not bad. But both are 1 bed flats/maisonettes with little room for improvement. That's what you've got to look forward to, if you save for 10 years, don't have children and never go on holiday. The only other options were a park home, or a non standard construction home which required £99,950 cash only.

MummytoKatie Wed 30-Jan-13 20:11:45

I think the big problem is that we have a "double whammy" going on at the moment.

When our parents bought their house 30 / 40 years ago mortgages were hard to get but house prices were relatively lower compared to salaries.

When we bought our first house 11 years ago, prices were pretty high but as two young professionals the building societies were throwing money at us.

Nowadays prices are high and a huge deposit is needed. It must be very difficult for new graduates and I am concerned about the future for dd and dbump. sad

However, the name of this site shows that most of us do have a very expensive luxury in our lives. Just doing a few quick calculations and I think in the city I live in if you save the equivalent of one child's full time childcare costs for 18 months then that would give you a 20% deposit on a 1 bed flat. 2.5 years would give you a 20% deposit on a 2 bed house. And personally I find dd quite expensive when she isn't in childcare as well.so delaying having children for a few years is one way that people could speed up saving.

Also it is a lot easier to cut the fat off your spending pre-kids. When my db was saving for a deposit 6 years ago he spent a year living in a ridiculously cheap share house with a room just big enough for a single bed and a wardrobe. But that just couldn't be done with a child.

I know people are saying that average age of a FTB is 37 but as average age of first child is 28 (according to Cherry Healy) that means that people are having kids pre house buying on average.

Not very helpful for those who already have kids I know but it is something I'll be telling dd (once I get the potty training sorted!)

Not a popular view - and never going to happen! - but 100% inheritance tax would sort out the inequalities at least. At the moment, children (or grandchildren) of homeowners who don't spend it all on final-years care will inherit enough to get their own houses. Those who don't, won't. And of course, those inheritances will keep prices high as there will be enough people who can afford them.

MummytoKatie Wed 30-Jan-13 20:16:13

Actually my sums are wrong and I haven't allowed for the tax advantages with childcare vouchers. Make it 2 years and 3 years of saving.

Although - that is a thought - perhaps the government should set up "house deposit" savings schemes where you can save up to a certain amount per month tax free but the money can only be spent on a house deposit.

Hmm - I quite like that idea.

expatinscotland Wed 30-Jan-13 20:26:58

The only 90+% mortgages going here are for new homes only. And there's not a one that's £100K.

expatinscotland Wed 30-Jan-13 20:29:37

'Perhaps we just have to accept that house ownership is effectively a luxury now not something we can all expect in our lives. Do we just need to readjust the way we think of salaryies and income brackets vs what standard living is attainable?'

We need to massively overhaul private-sector renting, for starters. Like that's going to happen.

slatternlymother Wed 30-Jan-13 20:42:59

But mummytokatie you're going to advise her not to have children until she buys a house? What if that isn't until she's 40?

I'm not criticising you, I just don't know that many people are going to sacrifice their childbearing years for a mortgage. Some do, granted. But not many. I'm just not sure that it's realistic.

LittleTyga Wed 30-Jan-13 20:53:59

Shelter are looking for your renting stories To present to Parliament - let the MP's know what we are all suffering!

GrimmaTheNome Wed 30-Jan-13 20:54:02

>100% inheritance tax would sort out the inequalities at least

Of course it wouldn't. You'd just get parents impoverishing themselves to give what they could to their children in their lifetimes.

StickyFloor Wed 30-Jan-13 21:11:29

When you say over-haul private sector renting what exactly do you mean?

I support changes to make it fairer for tenants eg more security, landlords obliged to be reasonable, do repairs etc, not force out tenants with little notice etc so that those who can't afford to buy feel that actually renting is not an awful alternative.

But the main issue with pirvate sector renting is surely the cost, that means tenants have little chance to save up and move on if they so wish. But how on earth do you control that? Increase taxation, council tax or CGT and landlords will simply increase their rents to cover it. Can you force private landlords to adhere to a cap on the rents they charge?

expatinscotland Wed 30-Jan-13 21:14:27

'Can you force private landlords to adhere to a cap on the rents they charge?'

It is done in other countries.

taketheribbon Wed 30-Jan-13 21:18:15

Just to give you a really stark comparison between the baby boomers (born 1940 - 1960) and Generation X (born 1960 to 1980) - dh (44), me (45) and dd (5) live in the 'affluent' South East in a miniscule 2 bed victorian terrace which we bought 10 years ago for 140k, when I was working full-time in a job which required a lot of travel. The house is now worth perhaps 200k. When we bought it, we put down a deposit of 30k, which we'd made on the sale of a flat we'd bought 10 years previously and which had been in negative equity for a while due to the recession/interest rate crisis/housing crash in the early/mid 1990s.

My parents are living in the same affluent South Eastern area, in a house which they bought in 1977 for 15k, and which was valued last year at 950k.

My mother has just inherited 500k because her father died and his one million pound house (which he bought in 1960 or thereabouts for £600) plus his various shares etc were split between her and her brother.

My parents are hoping to move to a bigger (!!) house.... using their inheritance and the money from the sale of their own house.

We (dh and I) have children. We desperately need a bigger house. I cannot work as I used to before the children if I actually want to be there for them before and after school or even at night, so I cannot earn what I did previously. Dh is not a high earner, but he works hard, 48 hours a week, to earn just over minimum wage. We are having to look at moving away from this area, to the north. 3 or 4 hours' drive from my parents. Who are now in their late 60s/early 70s and might begin to need us.

When dh and I retire, whenever that might be, I suspect we will have to move abroad to make our meagre pensions go a bit further.

We do not expect to inherit from our parents because there is every possibility that they might outlive us. My parents are lovely, but like others have said, they are unable to see that times have changed. My mother often says "but your father and I didn't have a washing machine when you were small". So, if I sell my washing machine for say, £200, I can have a house and a lifestyle like you then can I??!!

StickyFloor Wed 30-Jan-13 21:18:27

And is it a workable system or do landlords get their way on the sly with spurious extra "charges" in addition to the rent?

Tigerbomb Wed 30-Jan-13 21:21:40

We were lucky - we never ever thought we could get a mortgage so didn't try but 3 years ago my landlord went bankrupt and we had to get out.

We managed to find a huge ex council house in a lovely quiet road in the black country. It cost us £116k (that's for 4 bedrooms, two bathrooms). The asking price was £30k more but the owners needed to sell.

The bank gave us a 90% mortgage (shock) based on our then outgoings. Fortunately one week before they gave us the mortgage my DHs loan finished so he was able to get another one for £12k - that gave us the deposit. The bank still gave us the mortgage as our outgoings were still the same. We are actually in a better position now then wwhen we were renting, financially.

There was absolutely no other way we would have been able to get the deposit - parents couldn't help and we had no savings.

We are in this position of homeownership purely through luck - bad luck of the landlord and house seller and good luck through the loan.

slatternlymother Wed 30-Jan-13 21:26:20

taketheribbon will your parents not help you, even though they have been quite fortunate themselves?

expatinscotland Wed 30-Jan-13 21:28:08

'And is it a workable system or do landlords get their way on the sly with spurious extra "charges" in addition to the rent? '

It puts most speculators and individual BTLers out of business, which is a good things, and leaves commercial/professional business enterprise as the major source of landlords, which is good because they are more able to absorb changes in the market and in it for very long-term investment. Lots of speculators and individual BTLers can lead to volatility in the housing market which is never a good thing for an economy.

You have sub-prime lending here and too many individual speculators. This isn't good long-term.

Of course it works when it's the law and enforced.

The letting agent system here is also unregulated and abuses many on both sides.

LittleTyga Wed 30-Jan-13 21:32:09

I was in my early 20's when I bought my first home - I was earning £15k and I got a mortgage on my salary alone for a one bed in London with a garden and parking!!

My parents were a Postman and a dinner lady when they bought their 3 bed terrace in London and my friend's parents were a tailor and a cook and were able to buy a beautiful 4 bed with a huge garden in North London - No way would salaries like that buy a home these days - possible to rent a room today maybe? Having a home, bought or rented these days is unattainable for the average worker now.

expatinscotland Wed 30-Jan-13 21:37:37

Because a government that is truly concerned with the whole of those it governs seeks to make it not about anyone's 'way', be they landlord or tenant, but about stabilising markets, through law, to avoid too much volatility, which benefits the whole.

Landlords in other countries are businesspeople mostly, not speculators, and the law treats them as such - no BTL mortgages, heavy taxes for those who are not businesses/corporations, rent controls, securer tenancies in which you cannot put people out with two-months notice.

Likewise, tenants must put the place back to its original state unless agreed in writing or the next tenant and landlord like the changes, have a reason for moving, give longer notices before moving, cover some basic repairs and maintenance and the like.

slatternlymother Wed 30-Jan-13 21:52:15

Sorry taketheribbon I know I am being a bit pushy, but I think your parents are being quite tight and mean actually. There is no way I would be using any fortunately gained inheritance at that age; I would be using it to help my DC. To move to a bigger house? Goodness, how about helping their dd out a little bit? They sound quite selfish, and I'm really sad for you that you will be forced to move away because they won't help you out in any small way sad

slatternlymother Wed 30-Jan-13 21:55:04

Gah not 'not using any fortunately gained inheritance at that age'! Don't Internet bank and MN at the same time!

I meant to say, I wouldn't keep it all to myself at that stage of my life because there would be only so much enjoyment I could get out of it. I'd personally have far more pleasure helping my DC and DGC out.

I'm not saying it's a right for parents to help out their DC; I just don't see why you wouldn't if you were financially able tbh. That concept is totally alien to me.

Wallison Wed 30-Jan-13 22:01:34

^ 'Can you force private landlords to adhere to a cap on the rents they charge?'

^ It is done in other countries.

It used to be done in the UK too.

MummytoKatie Wed 30-Jan-13 22:07:54

Slatternlymother no I won't be putting it like that. What I will tell her is that once you have children your finances get a lot lot worse so anything that she really wants to do in life needs to be done before having children. Whether that is trips around the world or buying houses.

And that sometimes you can't always get everything you want and only she (and her husband / partner if she has one) can decide what matters.

Incidentally - during this fantasy conversation with my teen/ 20something dd I still look exactly the same as I do right now (except thinner as I'm no longer pregnant). She, of course, will hang onto every word I say and definitely won't have purple hair, body piercings or tattoos!

Mosman Thu 31-Jan-13 00:39:50

Anyone who thinks the state has to house you needs to take a walk around the city centre's at 12am and have a look at how many people are on the streets.
You'd really put yourself in that position rather than work out a way of raising the deposit on a house ?

ComposHat Thu 31-Jan-13 00:47:19

You don't really get it do you Mosman there is no way on god's green earth that many of us could raise a deposit. It is not like we are suffering from a lack of creative financial thinking or are spending every penny we earn on frivolities. B

Many of us,

A) Have to pay sky high rents and therefore find it nigh on impossible to save for a deposit.
B) Wouldn't get a mortgage as house prices are out of kilter with our meagre salaries.

We are not choosing to not buy, it is an absolute impossibility.

Mosman Thu 31-Jan-13 01:04:43

The answer for me if it was a case of paying sky high rents would be find a cheaper one and there will be if you look hard enough, we rent our house out at £250 a month below "the market rate" because I am hoping the person will look after it, she's somebody we know in a round about kind of way. So if they needed to save a deposit there's £3,000 a year straight away.
In our current situation we are renting whilst saving and have gone for the worse house, three beds when we really need 5. It's not impossible and given that people are going to be starring homelessness in the face it's a choice between hardship now whilst you're young and fit or hardship when you're not.

expatinscotland Thu 31-Jan-13 01:27:58

'The answer for me if it was a case of paying sky high rents would be find a cheaper one and there will be if you look hard enough,'

Oh, then jolly for you! So all those who honestly cannot find cheaper is to leave their jobs then? So they can move some place cheaper and be jobless?

Here we go again! They're all to blame! Just didn't find somewhere cheap enough!

Oh, move out then! Great! Now I have commuting costs and the price of petrol is rising, the tax on it will increase, and it will cost us all more to commute and pay for food. 81p on every litre of petrol. And set to rise. Even if you don't drive, so? That cost is the cost of commute, of haulage for food.

TBH, I'm allright, Jack. My parents will leave me enough, even bar care home fees which they have already purchased, and their funerals and burial plots and even headstone, to buy a place outright, even here. Or I could fuck off. So I should just say bollocks to everyone who can't do the same?

What are they supposed to do? Key workers, but on too low a wage to buy, paying sky-high rents. Fuck 'em, idiot nurses, fire personnel, police, care workers, nursery workers, cleaners, what have you! Go live in a tent (illegal), urban camp in caravan (illegal), find a friendly garden shed for rent (illegal).

Sod them all!

Mosman Thu 31-Jan-13 01:40:29

As I said it's not going to be a case of if you're fucked, more when so better to be in that position when you've two working arms and legs than when you haven't.

ComposHat Thu 31-Jan-13 01:40:39

So if they needed to save a deposit there's £3,000 a year straight away

Yes within a mere 15 years they will have saved enough for a deposit on an average priced house. Assuming that property prices don't go up.

Who knew it was all so easy?

expatinscotland Thu 31-Jan-13 01:41:15

There's a nation that's built to last!

'So, serf, I hear you were so stupid as to become a fireman, and your wife is a care assistant in a nursing home. What a pity! Your choices mean you do not deserve a secure roof over your heads, but I expect prompt service when my house in Marleybone goes afire. And someone to wipe my mother's arse whilst she is trying to kill them with Sundowner's Syndrome.'

'Oh, but, sire, you can go to fuck. I would not even piss on you if you were on fire.'

'Whyever not? I skivved out on all those boring lessons about those nasty peasants killing my forefathers because they were starving and not permitted to grow vegetables on the lands they rented from my lord forefather, they were hanged for that and for foreaging game on his estate (and they were!) in winter. How dare they?!'

Titter. Just like Cameron yesterday afternoon, asserting there was no need for foodbanks.

expatinscotland Thu 31-Jan-13 01:45:36

Titter! When Julian Fellowes presented yesterday and told of those hanged for growing veg and foraging game in winter on the bastard Duke of Richmond's estates.

Can't imagine why anyone would be angry, surely! They just made poor choices.

Mosman Thu 31-Jan-13 01:47:18

Nobody said it was easy and yes have a moan about it, I do regularly blush but it doesn't do me any good so we have to think of other options and ways around problems because moaning about it utimately doesn't actually help. Where we live they have just announced house prices have risen for the first time since 2010.
We'd currently have to borrow 5 times 44 year old DH's salary and save $60,000 and we will eventually, along side paying four sets of school fees and feeding and clothing ourselves because what's the alternative ?

expatinscotland Thu 31-Jan-13 01:51:09

Easy? It has become impossible and will do so for more and more. And the rental laws are disgusting.

So we all buy a one-way ticket out? Is that it?

Some nation, because that is the message that is being sent to the likes of slatternly, an engineer married to another. Fuck off to Germany! Think they'll come back? Will they fuck! Or their children. They'll take one look at the place and laugh.

Because it's not just unskilled peons we're talking about anymore.

expatinscotland Thu 31-Jan-13 01:51:57

You left, Mosman. You're not even in the UK anymore.

expatinscotland Thu 31-Jan-13 01:54:13

Get out of here, slatternly. There's no hope for you here, because they don't care about the likes of you. They won't change a thing, in fact, it will grow worse. It's the Titanic and your Carpathia has arrived.

ComposHat Thu 31-Jan-13 01:54:30

You left, Mosman. You're not even in the UK anymore

Christ alight that really takes the biscuit.

expatinscotland Thu 31-Jan-13 02:03:02

She's in Australia, Compos. Hence, dollars.

Mosman Thu 31-Jan-13 02:17:00

We did leave because there were no jobs available in the UK for my husband, so our choice was sit and complain watching our standard of living get lower and lower or do something about it.
I've moved from Birmingham, to Liverpool to Gloucester to Australia for work.
When times are good you save and then when they aren't your in a position to do something about it.
If you think it's bad now, what will it be like when you're 75, possibly alone ? That's how I've always thought about it.

Tortoiseonthehalfshell Thu 31-Jan-13 03:50:36

The multiples problem has happened here in Australia as well. The average income in my city is $47,000; that's for an individual, but with two people working fulltime that's just over $90,000. The median house price, including outer suburbs (an hour plus drive to the business district) is $390,000. So that's a 1:5 multiplier even with a double income family. Utilities, childcare, etc., have all increased massively over here as well.

Mosman lives in a city which is, I think, more expensive than mine. I live in one of the more affordable cities, in terms of prices:salary ratio. My friends who live in Sydney and Melbourne are facing the same things you guys are: they've been double income their whole lives, they live sensibly (I don't know anyone with kids who doesn't swap frugal tips, use handmedowns, etc), they tend to have university degrees, and yet most of them are struggling to buy their first place in their mid-late thirties.

We can still obtain mortgages with a 10% deposit, which makes an enormous difference. And our tenants have better tenancy laws. I'm certainly not saying "don't whine because everyone has it hard" - I think you guys have been sold a rotten deal, and I think the government rhetoric about austerity and personal responsibility is utterly morally unconscionable. I'm just saying that it's not an uncommon problem for this generation.

Tortoiseonthehalfshell Thu 31-Jan-13 03:54:36

I also think that those people talking about how when they first had a mortgage life was hard are missing quite a lot of points. Yes, it was different then for many reasons. Flat screen TV references are fucking ludicrous.

But also, I understand slatternly's frustration. When we first had a mortgage, we did do it hard for a while. Slept on a mattress on the floor with no curtains, at first, while we scraped up the money to furnish the place. But we had a few things in our favour, all of which helped massively:

1) We were young, and it's a lot easier to live skint when everyone around you is also young.
2) We didn't have children, and it's a lot easier to live skint when you don't have children.
3) This is the main one. We could see that our efforts were going somewhere. Gradually, we had furniture. And gradually, the mortgage started going down. And then we got payrises and the mortgage went down further. It is a lot easier to deny yourself if you can see a future where you can stop denying yourself. Paying down your own mortgage, vs trying to scrape up cash for a deposit when all the time property prices go up and banks get tighter? It's no comparison at all.

chandellina Thu 31-Jan-13 06:36:50

House prices will correct at some point, probably when rates rise. Despite current low rates, huge numbers of people are in arrears or forbearance. Banks don't want to take a hit on the loans so are propping up the market. Funding for lending has had some benefits for borrowers, another prop, but ultimately the market has to correct. The downside is it will either be because of higher unemployment, or raging inflation.

Buying after 30 or even 40 isn't somehow wrong though. To me it seems like the natural order to have that time to save up.

Mosman Thu 31-Jan-13 06:40:27

Raging inflation is quite honestly the only way out of this mess. I've been saying for the past 5 years that's the master plan and quietly it's been creeping up year on year.

LessMissAbs Thu 31-Jan-13 09:10:02

Even when I was at uni 15 years ago, I used to think the UK was pretty crappy compared to some n European countries. Few people agreed with me then but I guess mire people see it now. Its ridiculous, we have the costs of living in an expensive country, but low salaries, poor transport infrastructure and big sectors completely unrepresented in manufacturing by British brands. Education has gone for a free for all to those who can pay, talent is wasted, the workplace rewards inefficiency and incompetence.

I think moving to Germany is probably a better solution if you want a decent life. Rents are lower but it can be hard to rent somewhere desirable due to the competition. And don't think landlords will run around after you as they do here. Germans are more self sufficient, my German friends actually didn't believe me when I told them about HMOs and self closing doors...

Wallison Thu 31-Jan-13 09:23:58

It's all very well saying "Just find somewhere cheaper to rent" but rents have actually gone up in the past year; by 7% in London and 4% elsewhere. This is while most people's incomes have either gone down or stayed the same, and while benefits (including benefits paid to working people) have gone down.

Mosman Thu 31-Jan-13 09:37:26

So you cut down in other area's, what's the alternative under a bridge when your 70 ?

pingu2209 Thu 31-Jan-13 09:48:59

I bought my first house - a new build 3 bed larger detatched house in Bristol for £102k. We put a 5% deposit down - £5k, which we had saved between us (mainly him). I was 25 and earned £20k and my husband was 32 and earned £24k. It was a perfect family home with a reasonable mortgage of £97k, which was less than 2.2 times our joint salary.

The same house will now cost you £250k. However, you need at least a 10% deposit - £25k, and are left with a mortgage of £225k.

Salaries have gone up since 1998, but not enough. The job I was doing then would now earn me £28k and my husbands job would now earn him about £35k. So between us we would be earning £62k. Therefore the same house would give us a mortgage of 3.6 times our joint salary. BUT we would have to find a deposit of £25k first!

I am 40 and my husband is 47 - I thank my lucky stars we were not born 10 years later.

We moved areas to the South East 5 years ago and rented for a year whilst finding our feet in the new area. Renting is HORRIBLE in comparison to having your own home. Examples:

- Our landlord wouldn't let us put pictures up on the walls as it would leave holes (albeit very small ones from picture hooks)

- Decorate it to our taste even though we had 3 children who wanted bedrooms that were child appropriate rather than plain magnolia.

- The cess pit kept overflowing so we couldn't use the garden, we complained but the cost of updating the sewerage was too expensive for the landlord, so we ended up not being able to use the garden the whole summer we were there.

- We were not allowed any pets - not even our hampster, which we ended up having to leave in Bristol with friends, which really upset our eldest child (age 5 at the time).

- He gave us notice as he decided to sell after 1 year, which meant we had to move to another property and find yet another deposit. Yes you get your deposit back, but only after 2 weeks (min) of leaving so you have to find the next deposit, which amounts to £1000s on the new property before you have the old deposit back. Also you have the cost of removal companies each time you move - again this is £1000ish each time.

Renting is a nightmare.

Wallison Thu 31-Jan-13 09:50:09

You do realise that for people on the minimum wage or just above (plenty of them in the city I'm in as it relies a lot on tourism and hotels/restaurants/pubs do not pay their staff particularly well), regardless of how much of their spending they cut down on, it is simply impossible to get together a deposit? The sums just don't add up. The average house in the UK is now seven times the average salary. You can save until you're blue in the face but you simply will not be able to afford to buy anywhere if you are taking home £11/12k a year after tax.

The problem is not to do with personal spending habits, but high cost of living coupled with low wages.

slatternlymother Thu 31-Jan-13 10:04:14

Mosman but we've already discussed that 'cutting down in other areas' will only give you a small amount extra. Someone made the point that for those small extras to make a difference; you'd be saving for 10 years (fine) but house prices would HAVE to remain the same (not fine).

tortoiseonthehalfshell I agree, I think it is the problem of a generation.

I think the only possibility is the increase of HB to the elderly in future years. Because you can say 'oh, the elderly who haven't thought ahead can just go and live under a bridge', but what if like expat said; they were in low paid jobs and were saving as much as they could but that didn't match up? What about the people who can only save £10,000 every 10 years (and that is common), and every 10 years they go back to the bank, but they turn them away because house prices have risen, or they'll only lend half of what they need. WHAT THEN? Haven't they been responsible? Haven't they saved? What happens to them?

Mosman Thu 31-Jan-13 10:41:37

I could play the devils and suggest that just 5 years ago those small changes to spending habits actually would have been enough when 100% mortgages were available and 95% were the norm but no point in looking backwards, so going forward all you can do is make small cutbacks and savings and put it away and hope that it will amount to a deposit when the tide turns because what on earth is the alternative.
We bought in 2007 and in theory would be completely up the creek, we would have lost the house and been on a downward spiral but for the fact that we did get rid of mobiles/sky/had everything 2nd hand for a year saved £5k and got on a plane to where the work is for now.
I've found Australia to be in a worse state than the UK for housing as it happens but we'll suck it up, start again because there is no alternative your rent will NEVER go down, your mortgage will.

ILikeBirds Thu 31-Jan-13 10:58:58

They were reporting on the housing market 'picking up' this morning on the news as though this was a good thing. angry

Wallison Thu 31-Jan-13 11:05:10

Mosman, there are plenty of people who already don't have landlines or sky packages and buy everything second-hand. I know loads of people who don't even have a computer, never mind broadband. They are already cutting to the bone, and even with a 100% mortgage won't be able to afford to buy anywhere when the cheapest two-bed places around here go for £140k. It doesn't matter how much you economise if you are earning so little that you can't get a mortgage. It was completely different for people in my parents' generation - my dad was a train guard and my mum was a dinner-lady. They still managed to buy a three-bedroomed house with a massive fuck-off garden. What would someone earning those kind of wages be able to buy now? Fuck all. Glibly trotting out what people should be doing ignores the reality that for an increasing number of people, owning their own home is impossible and likely to remain so, even if they don't buy a flat-screen telly.

Wallison Thu 31-Jan-13 11:06:13

ILikeBirds, I hate that kind of thinking. "Good news, a roof over your head is becoming less affordable". Ffs.

Mosman Thu 31-Jan-13 11:26:18

owning their own home is impossible and likely to remain so, even if they don't buy a flat-screen telly

It might be likely if they don't but it's guaranteed if they do.
Plenty of people only own their properties because the council houses were sold off and I know personally people who turned down the opportunity because they couldn't lay their hands on £300 for the solicitors fees, bet they wish they hadn't bought the tele.

VariousBartimaeus Thu 31-Jan-13 11:26:36

There are so many permutations though, it's very hard to generalise.

1 Some people will never be able to buy - they don't earn enough and don't have family to help out and no amount of cutting back will change anything.

2 Other people are earning little but have families to help with a deposit or can decide to live frugally for several years to build up a deposit.

3 Some people are earning enough to buy but can't buy their forever house first and have to buy small then upgrade every X years once they've saved more money (by being frugal)

4 Others are earning enough to get a mortgage easily on their forever house first time round.

Obviously there are even more cases than that.

DH and I are in case 3. We earn good wages but for years lived in tiny bedsits in order to save and buy our first, small flat. Then we continued to live frugally (despite earning a good wage) in order to buy a larger flat once DS came along (and we didn't start TTC until we knew we could afford a bigger flat).

Our friends (same earnings) didn't want this and now complain that they can't afford a flat big enough for a family. These friends have spent over 8K on holidays each year for the last 5 years as well as 35K on their wedding. That's 75K they could have saved (I'm not even going to calculate all the michelin star restaurants they eat at every month). They could easily have bought small (instead of renting big) and then, like us, upsized when their DS came along.

I know this is a particular case as we're earning good money but DH and I accepted that despite having a good wage we would live in crappy places to save money.

We are very very fortunate to have had this choice though.

Tortoiseonthehalfshell Thu 31-Jan-13 11:26:51

So hang on, the average house price is 7 times the average income, and the banks want 25% as a deposit. So that means that your deposit has to be 1.8 times your annual income? If you're single, you have to SAVE UP two years's income.

Fuck me. I mean, seriously? TWO YEARS?

Mosman, on your figures I don't see why you are all "we'll find a way because we have to". There are times you just ... can't. And I'm really not seeing where the private school fees are going to come from!

Mosman Thu 31-Jan-13 11:31:28

If you're single, you have to SAVE UP two years's income.

2 years is nothing, my grandparents saved for 5 years. To buy a 2 bedroomed flat on tottenham high road ie a friggin dump.

Wallison Thu 31-Jan-13 11:32:40

But they didn't save up five years' income. It takes a lot longer than two years to save up two years' income.

And what about all of the people (ie half the population) that earn less than the average wage?

Mosman Thu 31-Jan-13 11:37:02

Sorry I misunderstood you're right they didn't but it still took 5 years to save up whatever they did need.
Talking of the average house is just silly nobody walks into an average house as their first home, you start off in a dump, a flat, a shared ownership, whatever to get yourself started.

Tortoiseonthehalfshell Thu 31-Jan-13 11:42:34

What percentage of your income do you think it is possible to save, if you're just starting out, you have small children, you're paying market value rent?

It is only as silly as assuming that first home buyers are on the average income, frankly. Young people looking for their first home are probably on commensurate wages to the sort of house they're looking to buy; i.e., if you're in the lowest 40% of the market, that's also the part of the housing market you're looking at.

I don't know what your deal is here, Mosman. You've admitted that it's hard, that you've had to move somewhere you dislike in many ways, that even then you'll need to find 5 times your DH's salary in order to buy. So why are you even arguing against the OP?

NonnoMum Thu 31-Jan-13 11:43:55

I don't know if this has already been mentioned, but one of the differences between you and me and mortgages is that you have had your children very young (congratulations - not knocking it - just pointing it out...)

So, I didn't have to worry about over the top baby gear and nursery fees until my mid thirties which meant my salary had crept up by then and the mortgage had gone down a leetle tiny bit.

Wallison Thu 31-Jan-13 11:44:29

The average age of first-time buyers in the UK is 35. At that point most people will have children and only 30 years of their working life left. Do you really think it sensible, if you are in those circumstances, to buy a 'dump' when quite likely your earnings are pretty much already at their peak and the jump between your 'dump' and a decent place to live is getting bigger all the time? Or to go for shared ownership when you may never be earning enough to buy the place outright? (And most shared ownership schemes are pretty much scams anyway.)

NonnoMum Thu 31-Jan-13 11:45:39

Also - we might find that jobs and houses get further and further apart. I know plenty of people who work in London but communte at least an hour and a half to get there in order to own their own house in the sticks...

noddyholder Thu 31-Jan-13 12:06:29

A long commute is soul destroying. I only live in Brighton but I know several people who commute to London who were keen initially and eventually decided to move back!

Mosman Thu 31-Jan-13 12:10:50

I'm not arguing against anyone/anything was merely suggesting how we overcame these issues.

noddyholder Thu 31-Jan-13 12:18:35

Most of my friends bought quite easily in the 80s and 90s. I know we did. All of us who bought are still doing ok but those who didn't are really struggling with crappy rentals and little hope of buying now even though many have well paid jobs. I think the govt are missing a trick with social housing. There is a real need for affordable regulated suitable family homes and settled solvent families spend in the economy and keep the wheels in motion. Lots of depression people off work etc stress relating to money and housing too. It is a real problem. I am renting atm and I am very lucky it is temporary. It was the only place i could have my cats It is tiny no storage no central heating downstairs damp bathroom and it is £1150 a month council tax 160 and only big enough for a couple with 1 child.

Mosman Thu 31-Jan-13 12:22:06

I bought relatively easily right up until 2002 and that's why if I'm honest I don't have a lot of of sympathy for anyone over 35 in that position because you have to ask what were they doing with themselves ?

noddyholder Thu 31-Jan-13 12:29:22

Well some were travelling and trying to get careers etc off the ground and no one could have foreseen the ridiculous rises. This is not a blame game a home is a sanctuary from the world and somewhere to just chill and be with your friends and family in what frankly is a world where everyone is working hard and just doing their best. It is unfair that so many are shut out of that

Tortoiseonthehalfshell Thu 31-Jan-13 12:45:50

But Mosman, you moved to Australia because there were no jobs for your DH in England. Presumably you couldn't support the family on your wage in England. You now rent in WA, right? And you hate the schools, and you can't afford to buy. Even though you bought before 2002.

So why have no compassion for others, when your own life plans have so clearly gone awry? I think you are doing a great job under unexpected circumstances, but clearly, things don't always go to plan and we all have to deal with what we're given. So why the smug 'well if you'd just' attitude?

Mosman Thu 31-Jan-13 13:00:31

We moved for DH's self esteem, we were managing on my salary and tax credits to pay the mortgage and everything else, school fee's included.
I wasn't trying to be smug, more helpful, sorry if it came across that way.

Mosman Thu 31-Jan-13 13:02:48

And the only reason we can't buy here right now is because I won't sell in the UK, I won't even commit to shipping our stuff over but that's due to my lack of confidence in other areas of my life at the moment.
I'll take a 2nd job if I have to in order to raise the deposit, you do have to get creative because as i've said a million times or so it feels the alternative is what ?

EIizaDay Thu 31-Jan-13 13:03:40

Mosman "I bought relatively easily right up until 2002 and that's why if I'm honest I don't have a lot of sympathy for anyone over 35 in that position because you have to ask what they were doing with themselves ? shock

Just Wow. What a selfish and ignorant post. People really shouldn't have superiority attitudes just because they bought a house at the right time. It has been all about timing/luck and nothing to do with the smartness of the buyer.

Mosman Thu 31-Jan-13 13:11:33

Absolutely, of course it's timing.
The people who left school with a few GCSE's and went and got jobs and bought houses at 20 who I went to school with are nearly mortgage free. The ones who went to university paid almost double for their houses but earn double so can cope i'd imagine, the ones that spent 5 years smoking dope in Bali, finding themselves or living it up whilst living off their parents, well the writing was on the wall - front page of the express actually - that house prices were increasing dramatically and it was a now or never situation.

imogengladhart Thu 31-Jan-13 13:16:13

Message withdrawn at poster's request.

imogengladhart Thu 31-Jan-13 13:24:41

Message withdrawn at poster's request.

noddyholder Thu 31-Jan-13 13:25:20

Smoking dope in bali are you for real?

williaminajetfighter Thu 31-Jan-13 13:32:39

Yikes. I think mosman may be related to xenia!

Not many people I know were saving in their 20s because they just didn't make enough income. Only in their 30s do they have a capacity to save but it takes year.

As an example - I was at Univ from 19-23, then working in low paid jobs and paying off student loan from 23-27, then did a Masters degree from 27-29, then spent a few years paying that off. That's me at 32. Renting, have a child at 35, then all money goes on childcare costs (eg £800 month), then at 40 when child is 5 finally don't have to pay childcare. So, um, where in all that is the opportunity to save a lot.

TBH the people I knew who dropped out of school at 16 and started working right away, bought a house at 20, are in a much better financial position. Who'd have thunk it!

Mosman Thu 31-Jan-13 13:37:19

But that was the point in 2002 you didn't need to save at all, a 100% mortgage for three times your salary would buy you a 3 bed semi at 5.5%, where could you go wrong ?
Evidently some did and those are the ones you're a bit hmm at when they bemoan house prices, they had their window and missed it.

Mosman Thu 31-Jan-13 13:37:51

And that was three times one persons salary in the west midlands, never mind two.

williaminajetfighter Thu 31-Jan-13 13:45:25

mosman how do you know our window of opportunity to buy houses isn't right now even TODAY and interest rates are going to rise tomorrow or next year and never go back down to something manageable?!!!

No one can predict the future and at any one point in time no one knows if they are in the 'right window' to exploit something. I don't think back in 2002 that anyone expected what would happen with the housing market or the financial market. Good on anyone if they did.

expatinscotland Thu 31-Jan-13 13:47:09

'I'm not arguing against anyone/anything was merely suggesting how we overcame these issues.'

We? You live in Australia.

Mosman Thu 31-Jan-13 13:49:20

Only for the past 7 months Expat, i've been in the UK rather longer than that and as I also said the housing market is quite heated here too.

noddyholder Thu 31-Jan-13 13:52:21

I don't think people really give 'the housing market' much thought before children and considering that is getting later for various reasons it is no wonder lots of people are in difficulties.

expatinscotland Thu 31-Jan-13 13:54:22

Yes, but you're in Australia and not planning to come back. Keep spraffing, though. It's amusing.

slatternlymother Thu 31-Jan-13 14:08:02

*But that was the point in 2002 you didn't need to save at all, a 100% mortgage for three times your salary would buy you a 3 bed semi at 5.5%, where could you go wrong ?
Evidently some did and those are the ones you're a bit at when they bemoan house prices, they had their window and missed it.*

What about those of us who were too young though? I didn't leave school until 2005. I joined the Navy, lived wisely, gained a good trade, saved my money and served my country in 2 conflicts. By the time I was back in the UK for long enough to consider settling down somewhere; too late. The financial crisis had hit.

That is (mainly) the generation that isn't going to be able to (or at least struggle to) get on the housing ladder. We are in our 20's, with no real way of getting on the housing ladder, no matter what we do. That is depressing; a whole generation facing never owning our own homes unless we do something drastic; like move countries hmm

noddyholder Thu 31-Jan-13 14:11:18

What is the situation with older people in rented houses Do they qualify for housing benefits?

slatternlymother Thu 31-Jan-13 14:12:49

And I know it was my choice to serve. And I don't regret it; best years of my life. But what were my other options? Go to Uni and be financially worse off by now/saddled by debt? Try my luck at getting a different job, perhaps in an independent company? None of these options would leave me better off.

In fact, the route I chose was probably the wisest financially, because I wasn't off renting for a long time (lived on establishments/on board), had a car but didn't really use it (loads of time away), cheap eating costs (see above) and we didn't go pissing it up every weekend. And drugs are banned in the Forces, so that wasn't an option wink

As a result, there was no debt, and a reasonable amount of savings (for someone on £18,000 - £21,000 per annum at the time).

slatternlymother Thu 31-Jan-13 14:13:56

noddy I'd like to know that as well.

A poster above seemed to suggest that her parents had been in receipt of it for their farmhouse. I'm sure they must be. You can't just throw a pair of 70 year olds onto the street.

Wallison Thu 31-Jan-13 14:21:12

Mosman, obviously all of the 35 year-olds trying to buy now are just not as clever as you and have all made shit life choices.

Incidentally, I can remember back in 2000 some people were talking about the 'housing bubble' and how 'it must burst sometime soon'. While other people were saying that you must get on 'the ladder' now otherwise it will be too late. But nobody knew which of those groups were right.

Mosman Thu 31-Jan-13 14:25:08

Yeah clearly.

I can remember the headline of the Express in 2002, average house price is now £100,000 and thinking to myself shit buy somewhere.
Everyone told me not to and I ignored them, thank goodness.

I'd just enquired as to how old my friends son is who was in the Navy, he's 27 just bought a house with his girlfriend in North Wales, had a baby last year they seem happy enough with their decision.

imogengladhart Thu 31-Jan-13 14:26:21

Message withdrawn at poster's request.

Wallison Thu 31-Jan-13 14:28:32

The Express also had headlines about Diana being on the moon with Elvis and a shopping trolley. The Express is fucking batshit.

Still, I'm sure as long as your friend's son is happy, there must be no housing crisis in the UK.

meadow2 Thu 31-Jan-13 14:32:35

Its hard now.Im 28 and was so easy when I did it.The most I havr ever earnt is 17k and I have my own place down South.I bought my first place on my own at age 18 on a 12k wage.

Our second place we bought for over 100k and only earnt 16 k for dh and I was getting student loan and 60 a week in my part time job.

Mosman Thu 31-Jan-13 14:35:59

Well they weren't batshit about predicting the house price rises were they so maybe Dianna will turn up any day now with Elvis on her arm.

slatternlymother Thu 31-Jan-13 14:40:34

I'd just enquired as to how old my friends son is who was in the Navy, he's 27 just bought a house with his girlfriend in North Wales, had a baby last year they seem happy enough with their decision.

Good for him. I live in Cornwall. Where house prices are 3x the national average. Not only that, but there is no point in buying when we are moving about. Far better to sit tight, and not have to sell up and move in 6 months time.

Are you trying to sound as judgemental as you seem? Because you're coming off a little bit like that.

slatternlymother Thu 31-Jan-13 14:54:13

And also, the average house price according the BBC for North Wales is £155,000. In Cornwall, it is £284,937.

I'm not being funny, but a lot does depend on where you live. Posters have already come on saying that people should move and buy up north. But that's not awfully practical, if you don't work there, is it?

expatinscotland Thu 31-Jan-13 14:54:29

I'd be taking some beginning German lessons, slatternly. It's not that hard to learn, the people are good at helping, and well, I think I'd leave, because this whole thing isn't going to get better, it's going to get worse.

Undertone Thu 31-Jan-13 15:09:05

Hrm. I think I am fairly atypical. I am 29. Rented in London from 2006 to 2011 and wasn't able to save anything from rubbish salary. As I was solo and I was lucky enough to have parents living within 1.5 hour commute from London I asked my parents if I could live with them for a tiny monthly rent for a year and save for a deposit. So I did that and saved £1k a month until I had £12k.

As I was a first time buyer I was able to be part of the FirstBuy scheme - paid 5% deposit (£8,125), the house builder and the Greater London Authority put up the other 20% (interest-free to me for 5 years), so I have a 75% mortgage with a roughly 3% interest rate - about £650pcm excluding the ground rent and maintenance fees from the landowner.

I was staggered - STAGGERED - at the heft of the legal fees and tax I had to pay for the house purchase which meant that I only had about £700 out of my £12k left for furnishing. I signed up to my very first credit card and promptly spent about £1,200 on that (bed, washing machine, fridge, sofa, curtains, curtain poles, etc etc...)

Moved in last August. It's a 1-bed with a balcony in Zone 3 London. I love it to bits and it's heavenly to be able to do things like paint the doors a different colour on a whim. And the SPACE compared with what I'd get for that rent in London... I think I'm on to a winner here.

Dunno how the finance will work out in the future, but TBH I am happy here and quite content to ride out any ups and downs in prices. I'll see where the market is in 5 years.

What crosses my mind about it the most though - I have been pretty consistently unlucky in love, and the thought of waiting to buy somewhere in partnership with a boyfriend was just impossible. So I have MY house which is MINE and forever will be, and I won't have to worry about relying on a man for part of my financial security in the future </bitter>

slatternlymother Thu 31-Jan-13 15:18:44

undertone that's actually a really interesting post, thankyou for contributing smile

I have to agree; I think you are fairly atypical in that you were a) on a good enough wage to save £1k a month (well done btw) b) able to live with your parents as they lived near to where you worked (well, ish! I'm sure a 1.5 hour commute must've been grinding) and c) you only required a 1 bed flat for the immediate future until you meet someone.

I think the last point is the clincher. The difference between a 1 and 2 bed flat is quite staggering, really.

slatternlymother Thu 31-Jan-13 15:20:07

But well done, btw smile

Undertone Thu 31-Jan-13 15:44:31

Yay! <high five> it feels awesome.

Maybe I'll stay here forever and be a crazy spinster in my 1-bed until I'm 85.

slatternlymother Thu 31-Jan-13 16:08:59

undertone there's worse things!! I suppose there's always a pay off. Maybe you're (as you put it) unlucky in love and have your gorgeous flat and can please yourself. I've been lucky in the family respect; job as well tbh, but have the misfortune to live in one of the most expensive places in Britain so we'll have to move.

Actually, fancy a swap? I'll come and live in your lovely flat and you can have DH (who hardly eats anything, honest) and my DS who never cries <looks shifty, proffers house keys> wink

GrimmaTheNome Thu 31-Jan-13 16:09:12

>No-body can easily predict the markets or we wouldnt all be in such a rubbish situation now.

It was entirely predictable, though not the details of timing and scale. Bloody banks lending too much to people, both here and even moreso in the US hence both house price inflation and the subprime market disaster of 'assets' which were worthless. Banks should never have lent such high salary multiples, and certainly not for 'buy to let'.

wonkylegs Thu 31-Jan-13 16:22:52

I know that the market is difficult but a lot of my friends who say they can't afford to buy haven't ever actually tried to save - they have expensive mobile phone contracts, go out every weekend, weekends & holidays away, sky TV, expensive clothes shoes, handbags etc.... Yet they moan that they cannot & will not ever be able to buy - they cannot see a correlation between making an effort & sacrifice now to see reward for their efforts later. I find it irritating as many often assume that I must have had help from my parents to own now , not that I worked bloody hard, saved every penny, went without, bought cheap house in a cheap area & did it up, had lodgers to pay the mortgage, sold it, and DH did the same & then we got our lovely house. It was bloody hard work and at times scary but nobody was going to hand it to me on a plate which is why I have a house and they don't. (we all have the same professional careers, and started off in the same city, although many of them have parents who up til now have paid for everything whereas I knew I was never gonna get some help)
I do appreciate that this isn't the case for everybody but I do believe the way that people view money/saving has changed and this has consequences.

meadow2 Thu 31-Jan-13 17:05:08

I will freely admit I didnt work hard for a mortgage, not in the slightest.I just bought at right time.

stephrick Thu 31-Jan-13 17:48:11

It all depends where you live, I live in the southwest and DS is working fulltime but will be lucky to afford to rent a bedsit let alone save for a mortgage, if you do not have a professional career and only a basic wage job(DS is a farm worker) then you have no hope of owning. But I thank God he has a job at all.

stephrick Thu 31-Jan-13 17:52:02

As for the time bomb, there are more and more young people having to take a basic wage, even uni graduates so yes there will be another down turn in the property market, maybe not as bad as the 90's crash, but something has to give. No first time buyers will result in lower house prices, then in 15 years time it will all start again, just one big circle.

expatinscotland Thu 31-Jan-13 17:53:16

'I know that the market is difficult but a lot of my friends who say they can't afford to buy haven't ever actually tried to save - they have expensive mobile phone contracts, go out every weekend, weekends & holidays away, sky TV, expensive clothes shoes, handbags etc.... '

Change the record already!

stephrick Thu 31-Jan-13 17:55:38

It helps if your'e a couple, but what of the singletons.

bigkidsdidit Thu 31-Jan-13 17:59:21

Story about his in the standard today. It said rent went up by over 10% in London last year, and 50% of renters have only £100 a month left after rent and bills to live on. No chance I saving with that.

A lot of renters have sky and iPhones etc perhaps (although of they didn't they still probably couldn't save enough) but 50% with 100 a month to live? That's shocking

wonkylegs Thu 31-Jan-13 18:08:21

expat it did say I appreciate that this isn't the case for everybody but we live in the North East where you can still get houses in some places relatively cheaply, rent isn't extortionate and with a group of friends who are professionals on a decent wage.
I do understand that this isn't the case in say London/south where the property market is ridiculous.

stephrick Thu 31-Jan-13 18:13:49

It all depends on how much is spent on non essentials, I think a mobile phone is an essential these days, and as for SKy, a basic package is £22 a month so not really a big saving if you cut it.

expatinscotland Thu 31-Jan-13 18:16:08

A mobile is all some people have for phone contact a lot of times. Because land rental is far from cheap, either, and if you're in private rented and move a lot, it makes sense to use a mobile rather than have a landline, and a lot of contracts supply net connection as part of a package.

How is a phone a luxury? I mean, how is your work supposed to contact you?

wonkylegs Thu 31-Jan-13 18:31:17

A mobile is essential but is the latest iPhone? Loads of people buy/sign up to this stuff because the headline deals are so cheap but over the lifetime of the deal they are hugely expensive (iphone5 on 2 yr contract costs min of over £1000) and there are lots of these little things that add up to an awful lot.

expatinscotland Thu 31-Jan-13 19:02:36

Yes, that's it, wonky. If only everyone could be like you, there wouldn't be this massively over-inflated housing bubble.

The pervasive petty, niggardly, blameful, downright hateful sentiment this government has done an incredible job of whipping up will be its undoing.

slatternlymother Thu 31-Jan-13 19:05:13

<shows off flat screen TV and iPhone to expat>

You see these? These are why I don't have a mortgage. I compromised my future security for shiny things, because I'm just too stupid to know any better.

expatinscotland Thu 31-Jan-13 19:06:09

Oh, and a minimum of £1000? Where are you looking?

Here are plenty for half that cost.

iphone5

Wallison Thu 31-Jan-13 19:52:57

£1000 is not 25% of £185,000 anyway. But you knew that.

meadow2 Thu 31-Jan-13 20:04:29

Tbf wonkylegs is talking about the North East and everyone should be able to buy there as its extremely cheap.

fridgepants Thu 31-Jan-13 23:16:40

DP and I are looking to move in together in a month or so. We will have to rent - both our jobs are in London, and while our combined income is £50k a year (most of this is mine - after years of being shit with money, I've started sorting myself out which is necessary when you need to pay a six week deposit to rent in London) we will not be able to afford to save. We're looking at £1200pcm for a small one-bed in zone 3. Neither of us will get help from our parents (my mum's house - bought with cash in 1980 - is worth about £60k because it's a poor area) and frankly, in your thirties it shouldn't be a case of having to get financial assistance from your mum and dad just to secure a place to live. We are preparing ourselves for spurious fees, the landlord having the ability to ask us to leave whenever they feel like it because they have the power to do so, having to prove our income, inspections, and shitty cheap furniture. I read about a couple who earn a wage small enough between them to qualify for housing benefit - they had to pay SIX MONTHS rent upfront to get themselves a place. I'm terrified that we'll be asked to do the same, because we have no way of producing this money.

I've been living in house-shares since I moved to London and at 30 I still have to ask permission to invite people over, or queue for the washing machine, and my bed is 'repaired' with parts of a different bed as the landlord is tight as a duck's bum; I live with my landlord and for various reasons I won't bore you with it's driving me insane to the point where it's fucking with my mental health (I have bipolar disorder, I'm not just melodramatic - the guy never goes out and can't communicate in any way other than making snippy sarcastic 'jokes' and I can't deal with it when I'm on a down-swing). A few months ago I looked into what it would cost to rent a place on my own because the situation was having an effect on my general day to day life. For a 'studio' - basically one large-ish bedroom with a shower cubicle and a kitchenette in it - in the outskirts of the city, it's £600-£700 a month, before the bills are added on. People aren't just renting well past their twenties - they can't even afford to rent on their own.

fridgepants Thu 31-Jan-13 23:38:59

Seriously, it's not just a case of cutting things out.

At the moment, as a house-sharer, I live in one room. So I don't have room for a big TV or whatever feckless people are meant to be spending money on- the most expensive thing I own is probably my laptop or camera. I don't have Sky because I'm not 'allowed' it here anyway. I don't drive, though I spend £25 twice a month to go and see DP as he doesn't currently live in London. I don't buy expensive groceries and shop carefully. I get my hair cut every few months and colour it myself. We rarely go to the cinema, and if we go 'out' it's round at a friend's house for drinks or inviting people over for games. I had my first overseas holiday in ten years recently and we went away again last year because I turned thirty. I ran up debt as a student, and since sorting my health out and getting more organised I've managed to improve my credit rating and pay almost all of that off. I don't smoke, barely drink and don't have a gym membership. I do have a mobile - shock - but it isn't a latest model. I don't buy lunches at work, instead making my own in the kitchen, and I only go to coffee shops to meet friends rather than getting a take-away each day. Funnily enough, a lot of people my age and in my income bracket are doing just this.

A 'cheap' flat here - as in anywhere in London, which I can't move from as a) transport costs cut out the benefits of saving on rent/mortgage b) my industry is very much tied to the capital - is £150,000. 25% deposit on that is £37,500. That's more than I earn in a year. With our combined income of £50k - let's say we can borrow 2.5x our income - we could do it, but only if we managed to pull £37k out of the back of the sofa somehow. In the meantime, we still have to pay for rent and bills. DP earns about £17k - his wages just about cover expenses. We were discussing going to the US in the next couple of years to visit friends, and I'm not sure we could even be able to save enough for that, never mind a deposit - because a landlord can terminate the contract and we'd need deposit and first month rent in hand to get somewhere else.

Mosman Fri 01-Feb-13 01:25:11

Everyone lives in house shares in London when they start out, I did in 1998 and London has always been 5 times your salary for even a 1 bedroomed flat in Walthamstow.
Basically what the OP means is she can't buy where she wants to live, well nobody can when they first start out, that's hardly breaking news it is ?

Mosman Fri 01-Feb-13 01:28:33

'I know that the market is difficult but a lot of my friends who say they can't afford to buy haven't ever actually tried to save - they have expensive mobile phone contracts, go out every weekend, weekends & holidays away, sky TV, expensive clothes shoes, handbags etc.... '

Change the record already!

Could say the same to you though, you've been spinning the same yarn for at least 5 years !

singalongsingasong Fri 01-Feb-13 02:06:11

DP and I are 28 and 29 and are planning to buy in the next year or so. We live in the south east, but not London, but it's still very expensive. We will definitely have to compromise a lot on area just to buy a small 3-bed, but we are ok with that.

We have saved up ~£30k so far, but initially it was quite tough as we were not earning as much in the past. But now, we earn £75k between us, and rent is £1000 pcm and we have no kids, so we can pretty much save my whole salary (£1700) each month so getting to a 20% deposit will be much faster. (This is assuming we don't make any big purchases or go on holiday abroad). But, if we had a combined income of £60k and £800 pcm childcare costs, we would not be able to save anything.

JoanByers Fri 01-Feb-13 02:23:51

A 1 bed flat in walthamstow would have been around 50k in 1998. Definitely not five times the average salary.

Mosman Fri 01-Feb-13 02:41:12

They were £120,000 and I earnt £25,000 at the time. I know because I viewed one and sat down with the mortgage broker to see if it could be done on 100% mortgage and it could, nothing special though and I decided it wasn't worth stretching for - kick myself occasionally but there we go.