… to think that no one wants to speak up for the younger generation?

[SnowBells]

I don't know what it is. Maybe political correctness gone mad.

Pensioners who are already wealthy get winter fuel allowance, etc. Each time this kind of stuff gets mentioned on things like Question Time or something, people shout and whistle, showing complete disregard for the subject, and no real debate can happen.

I am not talking about the pensioners who aren't well off. But a huge proportion of pensioners did profit from the higher house prices - something not likely to happen for the younger generation.

Our kids have to pay to go to uni. My generation will retire much, much later. We also have to pay for inflated house prices.

And yet, there will be people who say 'but we've paid our taxes'. Well, we pay taxes and our kids will, too, but we are likely to get A LOT less back. I just feel there's a huge generational wealth divide. And I wonder why no one wants to discuss this properly? Why do people want to stop a debate before it has even had a chance to happen?

Everyone will die. Your legacy is the next generation. So why not speak up for what essentially will be your only legacy?

bedraggledmumoftwo

That is the classic example of people who just don't get it.

And to be honest, I don't know where a lot of these people would be if they wanted to enter the job market now with qualifications they had when they were younger.

FiL was different as he did go to Cambridge, etc. but they have many, many neighbors who ended up in houses near the 500k mark - and I just think… my gosh, you do not know how lucky you are. Let's say, they weren't the most intelligent, and do not see how lucky they were.

Maybe you need a bit of intelligence to see that?

twofingerstoGideon

But many people who sit on houses costing an enormous amount these days would not be happy if the house prices were slashed by half now… would they.

Particularly people like bedraggledmumoftwo's parents, for example. And there are MANY of them around. I don't read the DM, but you can be pretty certain that they do.

Sorry merry thats is not always the case My aunt and her DH moved over here in 2010 they sold their London flat and bought a house with the proceeds.

The fact that their flat 2 bed Edwardian flat with high ceilings and a garden only cost them 25k in the 80s and they sold for 250k in 2010 MIGHT bear out what you say.

HOWEVER last year my Aunt found her old flat on Zoopla it had a new kitchen and extensive work done to it (something they could not have afforded to do) and had been sold on by the YOUNG purchaser for £329k thats a profit of the best part of 100k in 3 years.

Do you think that that young man gave any thought to people of his age
who would have been unable to afford it, do you think that he cared wether or not the mortgage payments would cripple the people who did buy it? the answer is of course NO.

So don't blame the older generation for making a profit when they sell
their properties when it can be demonstrated that the young are more then happy to do that themselves given the chance

Exactly, Caruso.

And do not forget that for some elderly people having to sell to go into care that they sometimes do not have a choice other then to sell at the highest price they can otherwise they may be investigated by the council for Deliberate deprivation of capital in other words when they are means tested for council care.

This happened when we bought our house for a 3 bed bungalow within a few minutes of the sea the price we paid was 95k less then it would have been valued by an Estate agent

This was because it was a private sale, the bungalow is attached to a larger house that was also up for sale at the same time, the vendor ( a family friend) was worried that both properties would be sold together to a developer or BTL landlord (in fact the larger house was a couple of years later having been on the market all that time) she wanted her home to go to a young couple who wanted it for their family home.

The money she got was enough for her to buy a flat with warden assistance, however 3 years on when she had to go into care the Council came calling demanding to know in ins and outs of the house sale, why we paid less than market value, how we knew about the house, were there any 'deals' made to enable us to buy.

We told them to F off, as everything was totally above board and members of her family were involved who supported her decision.

So its not always greed

Its not just house prices though. PIL have both benefitted from lavish final salary pensions, in FIL's case taking early retirement at 53 and never working again. Neither of them had degrees, yet got well paid jobs degrees would be insisted for now (as well as constant workplace assessments and performance monitoring). But as FIL said, they had a period of high interest rates, so they know what its like to struggle.

Who is blaming the older generation?

"There is a mysterious cycle in human events. To some generations much is given. Of other generations much is expected.This generation of Americans has a rendezvous with destiny" FDR worth a read again if you have a moment

A man speaking having dragged his nation off the brink of economic disaster and barely out of depression. A man saying that this wasn't enough. That economic survival was not enough. That economic justice was the only acceptable outcome. And giving a very sad nod to the world war to come.

I think he is right that there will always be inequalities in the life experience across generations. You can't choose what you live through. And as others have said, it is not helpful to pit us against each other - we need something more unifying not more divisive.

My grandparents were the generation of whom much was expected - global recession / depression followed by world war. My parents were the ones to whom much was given. I reckon I am about in the middle - but I'm all for doing what we can to make the next generation not another to tough it out.

SnowBells Sun 23-Feb-14 01:16:25

The trouble with yoofs of today is that they have to ask how old you are, even when you've told them the year you left school . I'll give you a clue, (2014 - 1990) + 16 = . Hopefully you won't need tech to work that one out.

I'm sorry but your post highlights exactly what I'm talking about when people try to justify spending money in order to be 'competitive'. With due respect, if you're earning in the top 5% then there is little excuse why you cannot buy a house. If saving a deposit is an issue then try living off one of your salaries for a few years. You'd have a deposit in no time.

As I posted, it's all about priorities so you need to work out what yours is. If being 'competitive' is more important then a deposit is never going to happen.

Tech

I haven't read all of your post. Just responded to one of them. So did not know you left school in 1990, etc. Of course, I can do maths.

To pay the mortgage AFTER the deposit, you need some sort of wage and a career that hopefully pays more and more, given that interest rates can only go up. You need a career these days. NOT just a 'job'. For that… you need to be competitive. Getting a house, but not being actually able to compete for a job is absolutely futile.

I am not complaining for myself specifically. As mentioned, we are getting parental help for the deposit, and should be buying later this year or next - it only really depends on whether we find something. My main issue is that those a little younger with no parental input will find it very, very hard.

expensive coffees are one part of a lifestyle that involves wasting money left, right and centre. Add in the cost of drink, overly expensive clothes, foreign holidays and invest the money you save wisely. Snowbells should, as has been pointed out already, be able to buy a home. My niece recently bought her first home - in London - and is under 30. Yes you need to dress to a certain standard, many people use that as an excuse for more and more expensive clothes than are necessary.

Of course the rise in house prices has made house purchase more difficult but someone whose income is as Snowballs is just blaming others for their inability to manage money.

Expat I know several people who retired at 60 and are having an enjoyable life, there was nothing ridiculous about it. Their homes may have to be sold to fund their care later but at least some will die before that becomes necessary. Some have already died. Life expectancy for those already past 60 is lower than the young can expect.

This country no longer makes items other people wish to buy. Therefore we have had to become a tax haven for the rich, pushing up house prices. We have allowed bankers to pay themselves silly money, pushing prices up further. It is up to the young to develop items people do wish to buy and to government to control the bankers, although none has had the guts to do so. Intergenerational argument is just a distraction. Pension age has finally gone up, those who have already retired recognising the problem makes no difference, taxing some benefits would be sensible but is chickenfeed. So this is a pointless discussion not worth commenting further.

… also, you just have to look at places like Germany, and you know there is something wrong with the UK.

bedraggledmumoftwo - agree with what you say. My parents are just the same. They don't get it.

All the housing wealth the older generation have accumulated is totally unearned and untaxed capital gain. All they did was buy a house and live in it. They didn't do anything skilful to earn that money. They didn't start a business or employ people or invent something or do anything for society. They just bought a house and borrowed some money.

That is what went wrong with the UK economy. Property became the only game in town. Most bank lending was against property and actually most small and medium sized businesses only got lucky by borrowing money and letting inflation pay off the loan to make profit out of property. My parents had a farm. Sold it. Bought a bigger farm. They only made money by selling that second farm to a property developer.

They borrowed £18000 in 1965 to buy the first farm and sold the second farm for £1.2 million in 2005. My parents worked physically hard but were uneducated and did nothing skilful or smart their whole life. They just got lucky.
Their whole Wealth is based on selling that farm. One transaction. It was like a lottery win. They made nothing out of actually running a farm for 40 years. Literally nothing but the money to pay the mortgages an overdraft interest and what was left was a fairly poor standard of living. Actually minimum wage if truth be told.

Property has distorted everything. Governments and the Bank of England stoked it up time after time and it robbed the younger generation of their future.

The Government and Bank of England are terrified of house prices falling. If house prices did fall it would destroy the banking system but the fact is it would do the younger generation and the economy a huge favour in the long run.

I don't think they will fall - its not just about the government/ bank of england. We have a massive over demand due to population growth/ single person households.

So youngies all you need to do is stop buying a daily starbucks coffee. That will save 20 quid a week, a whole grand in one year. Saving at that rate you will have your 50k deposit ready at the age of 70.

And actually on the coffees point a large proportion of these frugal people of the past wasted money on fags.

brettgirl, of course its not about the daily coffees (although as we know not only do all young people love coffee but definitely buy premium coffee every day) - if the young would stop buying their weekly iPod and monthly iPad they could definitely afford that £400k 2 bed ex council flat that was clearly just as hard to afford in ye olden days.

SnowBells

I was just pulling your leg about my age. In truth, I'm probably not that much older than you are, which makes it slightly ironic.

Sadly, buying a house is something that probably only happens for people with half decent jobs. This will probably change slightly for the younger generation but there are huge numbers of people that spend their entire lives renting.

To be honest I just don't see what you're saying but then I don't profess to know every industry. What I do know is that I don't need the most up to date phone or an expensive computer to get by. I also don't get why you need parental help when you earn in the top 5%.

I do wonder about my kids but one thing is for sure and that is they won't actually know how much harder life will be as they don't have the benefit of our experiences, any more than we know how much harder our lives are than our grandparents. They will probably have to be a bit more resourceful but that's life. What else can they do?

Old people selling houses to pay for their care is only the same as asking them to pay capital gains tax on the massive unearned and untaxed wealth they have accumulated. It is fair.

If older people do not pay for their care who else will? Young people struggling to pay rent from on an income that isn't rising are hardly going to pay much tax.

really? It was just as hard to afford in the olden days? You have the figures to back that up then?

Hmm, sarcasm fail...

Actually, basing on a lot such comments… one can almost assume that it was the older generation that was uneducated. Serious denial. Nothing else. People like that will go down in history books as the Louis XIV generation.

Haha sorry people in their late 30s are clearly ultra-dim!

www.newsroom.hsbc.co.uk/press/release/22_years_since_mortgages_peake

The numbers I posted up the other day were slightly different but this is interesting data for the year I left school.

Amazingly the salary multiples required are not far off.

In 1993 the average multiple of house prices to average earnings was 3 x salary. Houses were affordable because house prices had crashed.

Now that multiple is far far higher and it is that expansion in the multiple that is the problem.

I should emphasise that is 3 x average male earnings. Back in 1992 it was possible for the archetypal working man and SAHM to buy a house.

Now it is more likely both people have to work.