to feel pissed off with selfish 'baby boomer' generation

[hermionepotter]

this was in response to a newspaper article where people surveyed wanted interest rates to go up. I could be BU I know. But it won't be those paying massive mortgages and debts who'll be wanting rates to go up, will be older people wanting interest on their savings and sod everyone else. So am I BU?

When I bought my first house (on a much much lower salary than the equivalent job & grading now, even accounting for inflation), interest rates were 15%. They went up to 18% at one time. I worked 3 jobs to buy & renovate my first house (think: putting in an indoor bathroom, hot water & heating). It was a tiny house in a not very good area. But tat's what we did then oh so long ago in the eighties

Not everyone over 50 is a "baby boomer" and YABU in your attitude.

tallulah I find your idea that everyone is getting tax credits and loads of free childcare and is able to go to university just as U. If people go to university many will leave saddled with massive debts and no job. Lots of people would like to be SAHP but have no chance. Cost of childcare is ridiculous and expectations of hours worked have gone up.

I already accepted I was U but not VVU

I think the 15% interest rates was for matter of weeks weren't they?

There were plans announced yesterday to make mortgage interest help a loan rather than a benefit. I think all these things signal that rates will rise. Plus a lot of Tory supporters will not be in debt and would prefer higher rates than low. We worked our arses off for first house. It was on a main road opposite a pub with shared garden but we loved it. It is the sort of thing young people now would turn their noses up at.

I don't think it's jealousy though, it is more frustration that things that were obtainable to that generation are not for mine. There are a lot of people of that generation that benefitted from a 'windfall' with property and worked no harder in their jobs/professions than us. My Dad's friends, DP's Mum and a lot of her cousins all have expensive properties, second homes only due to being lucky. The jobs they occupied would certainly not provide a high enough income for these properties today.

also I didn't say everyone over 50 is a babyboomer maybe not a great term anyway but I would consider it more the over 60s who have pension and equity. To be fair I'm judging this by friends parents and not everyone and have been narrow minded. Apologies (again)

noddyholder what are you basing that on I have friends who would absolutely love to have a home of their own, any home

So what will be the effect of increased interest rates?

A boost for Grey spending which would boost the ecomony overall.

A sharp increase in repossessions?

Cost of living increase?

Wage inflation as prices rise?

Increase/decrease in BTL - don't know as mortage interest has always been tax deductable for landlords. Would many landlords sell up to invest at rate higher than their current rental yield or would BTLs increase as mortgages became even less affordbale?

15% interest rates were not for a "matter of weeks"!

We were in double figure interest rates throughout the 80s at least!

Something no-one has mentioned is that alongside high interest rates were high inflation rates in the late 70s and early 80s- meaning the value of people's mortgage loans dropped dramatically relatively to their income. Interest rates may have been in double figures, but with inflation at 16-18%, a loan of £30,000 would soon be vastly more manageable!

And would people please stop sniping about others' university education?

1. Everyone in the past 50 years had the opportunity to go, for free to university, it isn't some preserve of the select few- if you were clever enough to do Higher School Cert or A Levels, you could go.

2. Almost all jobs, even pretty lowly ones nowadays require a degree (or comensuruate experience)

3. We'd be pretty fucked as a society if no-one went to university really, no doctors, nurses, other HCPs, quantity surveyors, solicitors, teachers, etc etc. When they're forking out £9k p.a. just to train, or paying 14% of taxed-income in graduate tax for the next 30 years, we'll see how many people want to become teachers shall we?

so you're saying it was 15% and 18% throughout the 80s? I'd dispute that

Chunderella: I was saving for a deposit whilst still at school. I had a holiday job and saved that money.
I left school at 18, mortgage and married at 20.

Sorry, I don't think it's rational for any one to waste their disposable income on gadgets and trainers and pissing it up the wall because they have no chance of a mortgage.

They could actually save some money.

Like I say, they have been duped by the adverts - You're a nobody if you don't have the latest of everything.

I have a mortgage, and I still think IR need to go up.
It will make homes more affordable and people will actually get a return on their savings.
How in earth are people supposed to pay extortionate rent, and save when IR are this low?

. (Sorry OP don't have time to read today but fascinating subject and want to luxuriate in thread at leisure tomorrow so marking place)

that's the thing though paxtecum - no 20 year old would ever be able to get a mortgage nowadays, even if they'd started saving when a teenager imo

Could someone please explain to me how IR going up will make home more affordable please?

Surely everyone's landlords will need to put up their rents?

Renting needs strong regulation. People shouldn't be paying a rent that the property isn't worth just to cover some amateur landlords mortgage. A decent 2 bed flat should cost the same per month no matter what the owners mortgage is.

The housing boom needs to be sacrificed if people are ever to have a chance of a home. Higher rates and the inevitable repossessions and price falls would be horrendous initially but in the end prices need to return to sensible multiples.

Mean Income for 20-24yo is £13,200.
Mortgage available on that income- £46k
Average house price in UK- £242k

Even with a substantial deposit, how could young people ever afford to buy? Most cities do not have studio or 1-bed flats available at sub-£50k prices.

hermione, 15 hours a week is pretty universal, isn't it?

vworp in theory everyone could go to university, but in practice that didn't happen for our generation.

My youngest son refused to go to university and has always worked since he left school, so I don't agree that it's actually necessary even now. I know that nursing is now a degree level profession but don't agree that it needs to be. Similarly most others on your list except doctors and teachers.

Chunderella I agree - I am squandering it myself while I am supposed to save for a deposit (but it seems so impossible that I'm not very motivated)...

One thing I have encountered, and I'd be interested to hear what older people have experienced, is that now most young people in traditionally WC jobs (e.g. minimum-wage in the retail sector) seem disenchanted with their "lot" and are constantly aspiring to be seen as and live the life of the wealthy, without actually having the means to do so. Thus the spending of their income on luxuries which previous generations with the same comparable income wouldn't have dreamed of doing. I would like to know if previous generations in less well-paid jobs just seemed more content to adjust their spending accordingly and accepted that they would never have the kind of lifestyle that richer people had.

Of course I accept that a generation or two ago, these same incomes could have still facilitated home-buying and considerable savings, whereas now it's near impossible for this section of society. That explains the spending mentality somewhat.

Noddy- you know the housing market. If prices drop, people (particularly the group we're talking about here!) will not sell. They know the house down the road went for £x therefore they'll sell for nothing short of £x+5000

if interest rates went up it may cause house prices to fall slightly but who knows.

in the 70s wages rose quite quickly I think unlike today. I remember interest rates being high in late 80s and early 90s.