To wonder how the next generation will afford a house?

[Housepricewoes]

DH and I want to move to what will hopefully be our family home, in 2 years. Work commitments means we can't do it sooner but I'm stressing about how much house prices might rise in that time.

That got me thinking about how today's children will ever be able to buy a home.

I know it's a very British thing to aspire to home ownership but rightly or wrongly it is the norm.

Many of my friends and extended family have only been able to get on the property ladder with a significant hand out from the bank of mum and dad, but unless their circumstances drastically change, they are not going to be in a position to do the same for their children.

What do you think will happen about houses with the next generation?

Yes that's true, we moved last year and had 300k equity to use as a deposit. We were offered 5 times my DH's salary on a very low rate. We only borrowed 2 times.

The next generation? Plenty of this generation will never get on the property ladder. And some of us will never inherit anything to help us get on there.

I just put our details through the Nationwide calculator. It offered six times (!) DH's salary. We have a lot of equity, no loans or overdrafts, plus no childcare costs. Current mortgage is 3x DH's salary. They asked about travel costs (low as we use the tube so don't run a car) but not food shopping or utilities. We've had no help from parents to buy but DH is on a very good salary although not super rich, and we lived in shared flats into our 30s rather than rent a one bed flat which wouldn't have allowed us to save as much.

My experience amongst friends in London are that they are buying and using Help to Buy or shared ownership schemes. The housing market is busy in London and a lot of friends/family are buying/renovating. But many of my friends (in their 20s/30s/40s) have just one child, or none and have no plans to. I think there will definitely be a shift towards one-child families as then you can comfortably live in 2-bed properties, live car-free and think about helping them with costs like university/helping them on the property ladder in the long term, whereas it would get a lot more expensive with two or more. We are stopping at one and I know that's a huge factor in feeling more positive financially about the future.

Ok, so you can get 4 times your salary, fair play, but that's a long way from 8 times isn't it?

Also, upgrading on at least your third rung of the property ladder, to a £175k property isn't going to happen in many areas.

That wouldn't buy very much in most of the lower half of England.

And, most importantly, back to my point, it's not about those buying today, it's about their children.

Im searching lots of random Southern areas and finding loads where you can get a 3 bed semi for 175k. There are many places in that category again not in London or SE

Actually just checked Aylesbury as used to work there and theres plenty there and you can commute to London

FFS, I'm not talking about what you can buy today, I'm talking about 20 years from now.

You will stretching yourselves to a mortgage lenders capacity by buying a £175k house with a £55k deposit.

Where do you propose your kids will get such a deposit from in 20 years when £175k will probably only buy a 1 bed flat in the same area?

I've just looked on Rightmove and every one (of the just 28) 3 bed houses under £175k in Aylesbury look like ex council houses.

Not exactly the kind of houses the last generation could buy for (relatively) that kind of money.

If they are in full time work and saving from age 18 and living at home then only take 5 years or so at todays minimum wage saving 50% of income to save 25k by age 23. Im sure it will be the same in 20 years time add that to a partners thats 50k taking in to account inflation. Thats only in literally the lowest paid job.

My grandparents were going to buy a house which cost £400 and his brothers take him out of buying it because it was so expensive. He had a good job and earned just over £300 so the house was less twice his salary. The houses he was looking at now sell for 500k yet someone doing the job he did would earn 50k. I know that's a brilliant wage but the house has gone from less than twice the salary to 10 times the salary. I think it helps illustrate how things and attitudes have changed.

jasminemai I' think I'm going to give up discussing this with you as you aren't in the same world as me.

Even if your plan of saving £50k between 2 in 5 years came to pass, () your children would still be on NMW at 23.

That's about £12.5k each a year. Four times that is still only £100k, plus the 50k deposit and you're still not at the £175k you quoted.

If they don't go to uni after school, rightly or wrongly, it's going to be tough to earn more than NMW, if they do, they'll likely leave with a shit load of debt and will be reluctant to live back at home.

Jasmine: It sounds like you are going to be just like my mum is towards me. She can't understand why I can't have the life style she had as she just can't see how much the property market has changed. It's very frustrating trying to get through to her.

noarmani totally agree. Anyone who seriously thinks they could ever borrow 8 times their salary, with dependants, in the current market, cannot be reasoned with.

We are in central Scotland where houses are Mich cheaper than London, but even so we can only afford a flat. Dd1 still,lives with us - she will be 24 this year, as does dd2 when she is home from university. She is 21.
They both work part time to fund their degrees (dd1 in via the OU) and things like driving lessons as we have no spare money to give them. I can't see how they will ever be able to afford a place of their own. They still share a bedroom ffs! Dh and I will be paying our mortgage into our old age, assuming we still have jobs which is looking increasingly unlikely. I fear for our futures

My retirement plan consists off work until it becomes completely physically impossible then kill myself. It's preferable to starving or freezing to death because I can't afford food, heat or shelter.

I just finished a book about life in 20th century, from 1900 to the 1960s, in the tenements of Edinburgh and Glasgow.

There was a chapter on disease and illness. Over-crowding was, naturally, a major contributing factor. TB, in particular.

But people like jasmine think this is a good thing.

Its no point using me as I have over 50% equity in my current place so Im a bad example as can get a lot more.

Sorry to come back to this but I'm actually astounded that someone who has £55k equity in a property considers themselves 'a bad example' of a typical borrower.

£55k is nothing in today's market- it's about what most people will have to save to even consider buying a home, particularly after fees, stamp duty etc.

To secure the best interest rates you need 40% equity which is more than £55k on a £175k house.

Maybe that's why it stress me out but doesn't bother others- they don't see the reality of it.

We are finally buying our first house at the age of 42. We have rented for over 20 years and have been saving for a deposit for about 10 years. We are buying an ex-local authority house near to where we live now, as the dcs didn't want to leave their school. We are borrowing 4 X income and I am terrified, keep waking up in the night and panicking that we are doing the wrong thing. We know house prices are way too high and that we are buying at the height of the peak and that it isn't sustainable. We were forced into it to a certain extent, as we were served notice on our rented house just before Christmas. When we looked for other rentals in the area they seem to have increased by £500 a month from what we were paying and we decided to see if we could get a mortgage. It turns out that there is not much difference. The really depressing thing is that when we were reading through the deeds of the house we are buying, the previous owner bought it from the council for the grand sum of £8000 in the early 80s. I won't tell you what we're paying for it. It made me feel a little uneasy to say the least

What would you describe as overcrowded expat?

Someone a few pages back talked about how it is an expectation now that people want to be able to buy a home to live in rather than our grandparents' generation who rented or lived in social housing. As if that expectation is wrong. Well, yes - if I were a single offices manager or a teacher in my late 30s I would expect to be able to buy my own little flat or 2 up 2 down. If I were a nurse workin full time, and my other half was a builder I would expect to be able to buy a small family home and work my way up the property ladder. If I were a solicitor and my other half a part-time admin worker I would expect to be able to buy a largeish family home. This all used to happen in our grandparents' generation. It was only the very low paid or unemployed that had to rely on rental or social housing.

It is just laughable now when I see GPs buying 3 bed terraced houses in our area (NW) which were originally built for, and paid for by, working class households where only one parent worked full time.

If high earning professional types are having to buy properties originally intended for the working classes, where does that leave the rest of us? In deep shit, that's where. No, we DONT need to lower our expectations at all. Unless you think that those at the bottom should be satisfied with slums or workhouses.

The idea of saving £50k in 5 years is great, but 5 years ago DD1 could have put bought a nice 2 bed flat/house for £120k that would now cost £160k.

See here it would be the other way round housemum. There is a massive house thats been up for ages here it was 565k but now its 330k. Thats just in 2 years its lovely, 6 beds big mansion house looks like something of the tly.

Exactly curly. I do get the feeling that the current Government would like us to curl up and die. Good point too expat.

After we ended up homeless we spent some time all living in one room and sharing a bathroom and kitchen with another household. The latter 2 conditions are most conducive to spread of infection. You cannot control the hygiene levels in your toilet when you are not the only family using it. The number of people using a single toilet even when well cleaned is linked to infection spread.

jasmine please provide a link to this 6 bed mansion that is £330k and was £565k 2 years ago- I need to see what colour the sky is on that planet?