to feel seething resentment towards those who profited from the house price bubble and hot anger at the Governments who allowed it to happen?

[TartyMcFarty]

You'll have to forgive my naivety here - I'm ranting about something I don't really understand.

DH and I are stuck. In 2006 we bought a (modest) property on a 100% mortgage. Foolish in hindsight, I know, but based on the advice of our IFA, the unshakeable faith of our families and society that property ownership was the way to go, and the increasing pressure at the time to get on the ladder or miss out, that was the decision we made. We then found that the lender, bastard bastard Northern Rock were unwilling to remortgage based on our lack of equity, despite us having overpaid by several thousand pounds. We couldn't shift the place, and with the agreement of a different IFA, remortgaged against the equity in my DM's property (love her!). It gets more complicated than that, but that's all that's needed here. Now we still can't sell it , our tax credits have suddenly disappeared, my pension contribution has increased (DH doesn't even have a pension) and the tracker rate is slowly increasing. We're on interest only, and as I'm part time since the having DD, with another DC on the way, there's not much of a cushion.

What's really angered me over the last couple of days is the dawning realisation of how people just a few years older than us have profited from the massive increase in property 'values'. I'm still in touch with our ex-neighbour. She bought seven years earlier than us, sold at £120k profit after 10 years (this is not London!), her partner was in a similar situation so they have ended up comfortably in a property of twice the size, renovated to a really lovely standard. Obviously my resentment isn't directed at them personally - they're good people, have profited from a stupid market and good luck to them - but it's just an illustration.

How can we possibly hope to survive in a property market that boomed by more than 3.5x in this instance alone? We can't even afford to maintain our own home to a good standard. Pay isn't moving at all, and we're currently looking at less than .75 of a pension between us. I can't even bear to think about how we'll support our DCs through HE, and the risk to my DM's home if interest rates shoot up.

I just need a rant. Those of us stupid enough to be sucked in at high LTV rates towards the peak of the market are fucked all ways, whereas people just 5 years older than us are untouchable. I know I've only given one example for which I know the exact figures, but there are others I can think of in the same lucky situation. There just doesn't seem to be any point in trying when you compare our situation with those who profited so enormously in the 00s.

afussyphase some friends of my parents bought their council house in the 80s under 'right to buy' sold it for £120k in the early 00's (a cool £110k profit) and then somehow got a council bungalow to retire in.

So they now have a lovely little council bungalow and £110k in the bank

I raised my with my parents about all those elderly who really need that bungalow. My DailyMailesqe parents shouted me down that this couple really deserved it as they worked hard all their lives.....

Oh god MarthasHarbour I'd have turned puce. I hate that term 'worked hard all of their lives' usually said by people likely to retire 20 years before me. Who technically will actually be likely to work for half of their lives and for the rest of the time expect society to pay for them. I just want to rant at them 'You've worked for 40 years - what do you want a medal? I think you'll find your wages were the motivation for your labours and your reward. For years you've said my house is my pension, but now it comes to retirement it seems you want a house and a fecking pension' grrrrrrrrrrrrrr!!!!

Fruitsaladisnotapudding as to what will happen to house prices - with a glut of supply as the boomers downsize and retire, and serious dampening of demand by general impoverishment of likely buyers due to austerity and falling wages and return to a sensible restriction of credit - can you see prices doing anything but stagnating or falling? The government to me seems to be managing the bubble and hoping it deflates gradually - so that they don't get blamed when folk turn out not to be as rich as they thought they were - but they do seem to have recognised that alienating half of the population by enriching those able to get on the ladder earliest - is likely to become a dangerous policy when those priced out begin to outnumber those sitting on paper gains.

Incidentally we bought (sensible multiple 2.5x single salary, large deposit, long saved for - no bank of Mum and Dad) last year but I am minded to go back into rented as I think there could be some bumper falls (provided there's no more QE) over the next 2-3 years. We bought a wreck and did it up, so I perhaps expect to cover our costs - I have no reason to believe we'll make a profit - I don't have the vanity to think my amateur DIY adds thousands onto my house!!! Lydia wonderful analogy with the car! I love it, why on earth do some folk think that by slapping their taste onto their home they've added value!? If I see one more 'wacky' feature wall, tacky high gloss kitchen or vase with twigs in it.... I really will despair of the UK's sense of originality and innovation.

That all makes sense yellowWellies, but it's seemed like house prices should have crashed for a couple of years - it's been ages since the banks stopped lending stupid multiples and yet here we are with prices (at least in the se) pretty stagnant.

And will there be a glut of boomers downsizing? Certainly my parents and their friends are staying put in their 4 bedroom houses.

YABU for 'hating' people who've done things differently to you. We made a huge 'profit' each time we moved, but it was only on paper. Because the house we bought had gone up too. The sort of house we have always wanted has always been out of our reach. Originally it was about £5000 out of our reach- now it's £200,000, but it makes no difference. We couldn't have it then and we can't now.

I have always worked FT. I couldn't even be PT when my children were small because we just couldn't afford it, so AIBU to 'hate' you because you are PT? Perhaps if you were FT you could manage?

My parents moved abroad (for work) in the 1980s. They sold their house, which they owned outright, for £32k, which they put in the bank. They would be able to save a lot while out of the country and my mum had big dreams about the really nice house she'd have when they came back, in the "posh" road in town. They came back to the UK in 1988 at the height of the boom and ended up in an ex council house in the grottiest area of town, with a huge mortgage :( Nobody forsaw that.

Oh if I hear another boomer saying they worked hard all their lives!!!!

My MIL is keen on this saying. Despite the fact that she gave up work when she married at 20!!!! Then worked part time here and there over the years before retiring for good at 57.

My mil also says she worked hard (usually in reference to her pension). She took 10 years off to be a SAHM and then worked part time until her children left home. And is genuinely outraged that she can't really afford to retire at 60 and will instead have to work pt until she is 64.

I have tried many times to point out to my ILs how fortunate they have been.

They could afford to buy a (modest) home when newly married, on one wage.
MIL could afford to SAH for years. Then go part time. She never ever worked FT after she was 20.
FIL could afford to take a career break and go to university. Free of charge.
He retired at 55. She at 57.

They got excellent pensions, considering the low level of putting in they did.
Plus of course a state pension.

They also have quite a bit of equity in their home which they are slowly releasing to pay for cruises etc.

Now I do not begrudge them any of this. But by God I wish they would accept their huge good fortune. And accept alsdo that this is simply not possible for many young people today.

I feel so sorry for young people these days: the whole of society now seems to be run for the benefit of the banks.

When I was a kid in the 60s-70s, my dad used to bring home his wage packet (cash) every Friday and give it to my mum. She used to give him back a bit of pocket money and then use the rest for housekeeping. Some went into the bank for the tiny mortgage and a little bit of saving, which was the sum total of the bank's involvement in our lives. When us kids were a bit older mum went out to work herself - cash wages just the same.

Banks must have cackled in glee when companies turned to paying money straight into the bank rather than into the hand.

It now seems to be fairly compulsory to go to university these days as most worthwhile jobs require a degree, so a young person at 21 will already be saddled with thousands in debt.

Perhaps they'll meet someone and want to get married: the average wedding in the UK costs £21,000 thanks to the stupid culture of over-the-top weddings that are tacitly encouraged by the media and magazines. Who benefits most? The banks again because you'll need a loan to pay for it all. Add that onto the new couple's combined university debts.

Then they have to try to buy an overpriced place to live that once upon a time could be comfortably paid for by one wage and now requires two. Add that debt on, too.

In debt to the banks as soon as you hit adulthood and then for the rest of your life.

O Tempora, O Mores.

Some people seem so pissy that some people have money. 100% inheritance tax wouldn't work. Who in their right mind would save to give the money to the government? People have the right to do what they want the money they earn and save. When it comes to houses, I don't really get why they go up in value. I agree with pp that you wouldn't expect it with cars.

I do feel for the OP although she'd probably hate me.
I'm in my mid 40s and have masses of equity in my property as I have benefited from the rises of the past 10-15 years.

However I first bought in 1990, in the middle of a recession. I was earning 15k a year, interest rates were 15% (yeah, lots of people conveniently forget that now) and my mortgage payments were a massive proportion of my salary. Not long after buying there was a big house price slump and I spent a few years in negative equity. Luckily I didn't have to sell then and so have ended up in my current situation. Fortunate, yes, but not without its ups & downs.

I do think it is unreasonable to hate someone for basically just being luckier than you in one thing. It is what it is.

I think there could be a glut downsizing if energy prices keep on rising, and if the government finally realises the only area where benefits are not means tested (and are ripe for a cut) are benefits that go to pensioners.

I don't think this is entirely unfair. We hear the self interested rhetoric of 'I've worked hard all my life' (yeah yeah you're retiring in your fifties and early sixties...) but in reality 80% of the UK's wealth is in the hands of the over 55s (it used in the period from WWII to the late 90s be more like 40% of the UK's wealth so let's not argue it's always been thus) given that they own 80% of the top of the range cars (seen a youngster in a sports car recently?) they can by, and large, buy their own bus pass but to be fair lets means test it to make sure that no one slips through the net.

I think when you are old (and I'm heading toward middle age) you have had far more chance to save and shape your own destiny (and therefore why should benefits for this group not be means tested you've had your whole life to try to improve your lot?) than those poor kids about to go to uni and told carte blanche they can't expect any help. It's like punishing the poor kids for being born to poor families when there is very little they could have done in their short 18 year lives to improve their lot.

Let's face it there aren't many other areas the government can cut. I also think the mansion tax is an interesting development and indicative that houses are large, illiquid assets (i.e you can't get rid of them quickly) just ripe for taxation by an impoverished government that is running out of cash and which is seeing tax incomes fall.

There could also be a glut of downsizing if interest rates continue to be low and annuities continue to be shocking - as folks may have to sell (or sign up to stupid equity release schemes) to have enough to live on.

I think there will also be a moment of realisation 'of the other shoe dropping' as it were. Certainly in the markets I'm familiar with the only segment really moving is those high up the ladder selling to and from each other for ever inflating prices. No one is getting on the ladder and no one is moving up. But those near the top just haven't figured this out yet and are still swapsying houses for silly money. It seems they are too out of touch to see how the rest of the country is suffering and that the game is up. When they notice the ponzi has ground to a halt and see friends of theirs get bitten on the arse, then sentiment will change rapidly (after all this is the demographic that steadfastly believes 'you can't go wrong with bricks and mortar').

At present these pressures are brewing... when they will come to a head I don't know? My guess - between now and 2020 and most likely before 2015.

But I know lots of folks moan that boomers have had such a lucky ride, I have a sneaky feeling they are going to get knobbled in retirement. I'm kinda glad I'm getting economically shat upon whilst young - it means a shit retirement will be less of a shock . I would be bricking it if I was sitting on a lot of paper wealth and nervously expecting an impoverished priced out generation to support me in the manner to which I'd like to be accustomed for potentially 20-30 years whilst the world economy nosedives!! Good luck with that. Good luck with relying on those same bitter young for your personal care as you get old and vulnerable. Those you've always dismissed as not working hard enough? Perhaps better to share the sweeties now rather than have them taken by force?

As soon as the priced out are the majority (which looks to be c. 2015 if current trends continue) then I would expect the policy and tax environment to turn very harsh towards those who seem to be sitting pretty today.

Hear hear wordfactory if these folks would just recognise how lucky they have been it would make our lot easier to bear. But no, they are defensive and point to x months of living on baked beans, to a generation that will be lucky to move out of shared housing by their 40s!!!

Dprince it's about availability of credit. Period. House prices have gone up in a bubble. Check out bubble psychology - it was no different this time. You could shave a labrador and send it into Northern Rock and it would have come out with a 125% mortgage five years ago. The credit crunch is just the return to normal when banks realise they do have to price in risk after all and really, maybe shouldn't lend to anyone purely on the proviso they can fog a mirror, but perhaps need to consider if they can repay it.

I would be bricking it if I was sitting on a lot of paper wealth

Anyone sensible is buying silver and gold.

Anyone sensible bought silver and gold before Lehmans brothers went tits up! The folk on housepricecrash.com are mocked on here for being misanthropic but my god you can learn a lot from them investment-wise. I pulled all of my money out of Icelandic banks and Northern Rock whilst Robert sodding Peston was still reeling out Brown's propaganda that there was nothing to worry about. Jeez even if you just invest in stocking up your pantry - you'll be 16% over the next year given food price inflation. Anyone hoarding our devaluing currency isn't doing themselves any favours thanks to the policy of bailing out the overstretched (both bankers and mortgage holders) by QE. The prudent are suffering because of the feckless - but then life was never fair. The feckless outnumber the prudent so the government pander to them.

Hmm, our savings are in a bank account. Have toyed with the thought of buying gold but don't really know where to begin.

Would love to though. I hate the fact that my money is being used to support borrowers. If that makes me selfish, so be it.

Agree with hopandskip "I do think it is unreasonable to hate someone for basically just being luckier than you in one thing. It is what it is."

I was in the right place at the right time. Took on the responsibility of a mortgage at 21 in an expensive part of the country. Scrimped and saved and did without hols/fancy cars/nice clothes/going out during my 20's. Moved from my flat to a doer-upper semi. Sold that semi for almost 4 times what I paid for it seven years later. Moved away from expensive area to much cheaper (rural) area (where I'm from). Mortgage free in my forever home at 36.

Lucky? Yes of course. Also willing to take on reponsibilty at a young age. Hate debt of any form so paid as much as possible into mortgage in an effort to clear it as quickly as possible.

I didn't buy as an investment. I bought somewhere to live. I benefited from the ridiculous rise in prices and was able to realise that by selling up and moving elsewhere. None of it was done as some cynical money making scheme. Right place at the right time with a healthy fear of debt.

House prices will fall further I'm sure. My house will be worth less than it is now. It doesn't matter to me as I don't owe anything and don't plan on moving. For some it will be the answer to their prayers, for others the stuff of nightmares. I sympathise for those that can't afford a modest family home at present but also for those who are mortgaged up to the hilt and will be stuffed when prices do fall further. It's all a bit shit really.

I dont get why you "hate" people who took a more sensible approach to their mortgage, and also made sure they didn't over price their house in term of the area they were buying in.

We made a huge profit, brought it when the house was low selling and sold it when the house prices were at the highest. Its not my fault, you choose to buy at the wrong time, nor should I be hated for it.

I think it's unreasonable to feel seething resentment towards people who bought a home when they needed a home, were able to do so and who have seen a rise in value of their home over the years. However, those who take credit for the rise in value of that home in a smug kind of way fall into a different category. Resent them all you like.

YellowWellies, are you parents alive still? Are they baby boomers? I do agree with a lot you're saying still. I was one of the few voices saying that child benefit should not be means tested while winter fuel allowances are not because the very same arguments used to justify keeping winter fuel allowances a universal benefit apply to child benefit.

My parents are probably in the group you're talking about. My dad was born just before the war, my mum during the war so early baby boomers possibly. They have a mortgage free house worth about £850k, another home in France, my dad has a large final salary pension he worked 40 years for. My mum has a private pension which is huge, but her savings were so great (and money she'd invested in her company which she got back when the wound the company back) that 2 years after retiring she still hasn't touched her pension.

My mum was horrified (and I don't use that term lightly - actually horrified) when I told her we wouldn't be going on holiday this year because we can't afford it. And I think we're really well off. It's like we talk a different language now.

Interesting to see the nuances in language - when older posters (or those that bought before the last boom) took on a huge mortgage it is labelled 'taking on the responsibility of a mortgage', when folk did that this boom 'they are mortgaged to the hilt and stuffed' or 'buying at the wrong time' and generally part of the irresponsible credit boom.

Anyone else willing to admit that they were lucky and there by the grace of god go I? I mean what if the boom of the 00s hadn't happened - am guessing a lot of smug sounding folk 'who took on the responsibility of a big mortgage' / aka mortgaged themselves to the hilt - would be scrapping for pennies.... rather than in their forever houses!

I lost my Mum when I was young. My Dad has since had a second family so I don't expect an inheritance - but yes he is from the Babyboom generation and is used to shaping the world for his needs and wants.

op so would you prefer a price crash now and that would atleast let the youngsters have a foot on the ladder

no you probably would not as it would not suit your circumstances

in some ways you want it both ways,you wouldnt want a crash thus making housing more affordable to the young but that would mean possibly you losing money,but would you mind if your house rose in value,im presumming you would not as you seem to see it as an investment

lets face it most people are really only bothered by their own and their familys/friends circumstances

i have no magic solution and am finding this thread very intresting but what is the solution????????

Oh absolutely YellowWellies - I bought when it was a good time for me to buy and I was lucky that it was at the bottom of the market in the early 90s. I credit my entire house buying/selling history to sheer dumb luck.

As I said earlier in the thread, my friend who bought in the 1980s (about 5 years before I bought my first flat) saw the value of that plummet in value and when she and her husband split up a few years' later, they were fucked financially.

My parents are a bit older and certainly didn't have it easy - like another poster above, they left the country and when they returned couldn't afford to buy the house that they had sold 20 years previously. They didn't pay off their mortgage until they were in their 70s - my dad worked until he was 70, my mum retired at 68. But had they stayed in the UK, I have no doubt they'd be sitting pretty with holiday homes galore.

So much of it is related to where you bought too - I was living in London when I bought my first flat and property values there skyrocketed. In other parts of the country, the rise wasn't nearly as steep.

I'm the first to admit I was bloody lucky YellowWellies. I jointly bought a flat with my sister in '96 because it was cheaper than renting privately, though the first mortgage I got was a 90% mortgage, with the interest rate at 7.5%. We bought the flat for £150k and I sold it for £380k just over 12 years later. Incredibly lucky. Not that I did anything spectacular in that time, just bought a flat I could afford in an area close to work. I didn't realise at the time it would become the archetypal "nappy valley". I'd never heard of the road, didn't know the area. Just picked somewhere near a good mainline station. It's unrecogniseable now. Lots of Porsche Cayennes and three bed terraces that sell for £900k. I call that serious luck.