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?

YANBU OP.

DH and I are only on the property ladder thanks to our parents - mine for paying all of my uni costs as they didn't want me to start adult life in debt, and DH's for giving him 50k as a deposit loan. This enabled us to get a 70k interest only mortgage in 2005.

2 months ago we remortgaged to get onto a repayment mortgage (I'm now in a steady, secure job and DH is a SAHD). We wanted 75k so we could clear DH's credit card (historic purchases).

I'm currently on 30k (4 days a week) and our house is now worth at least 160k. They went through our outgoings in quite a bit of depth. What worked in our favour was:

• The percentage of equity we had in relation to the loan amount
• No childcare bills thanks to DH
• No student loans or debts apart from that one credit card, which they said wouldn't count as the mortgage would wipe it.
• How easily we could afford repayments (monthly repayment amount = interest only + credit card repayment)

According to their calculator (Nationwide), they would lend me 120k, so 4 times my salary.

This is for a tiny 2 bed terrace with no parking in East England. I don't know how we are going to move up to a 3 bed, yet alone help DS out in the same way that we were. Our savings are rather pitiful, but I am insured to the hilt with critical illness cover / life assurance etc.

Having said all of this, I know we are lucky. Our mortgage payments are £360 per month. Most of my colleagues are renting and spending between £800-1000 pm on rent. If they don't have a windfall / partner / parents to give them a leg up, it is going to be a long time before they can save up that deposit.

I dont want to out myself but prices here fell dramatically since 07. The higher end fell fast which is lucky for me. Its because wages are low I suppose average is under 19k.

Its 6 bed I was going to buy it with my parents and all 8 of my family live there but unless I can pay it off by the time they are 75 Im not allowed. Shame!

Tenants in Europe have secure tenancies. They cannot be given notice on a whim. They cannot be forced to move area and move school and move house every 6 months. The rents they pay are protected in advance so they cannot suddenly increase in a year. They can have pets. They can put up shelves and mirrors and buy new carpets and generally live a full life in the home they pay for. Renting here is just so awful that many people are desperate to buy.

Canada also has laws more favourable to tenants. I have lived in Canada, UK and USA and the UK and USA are miles behind Europe and Canada in terms of tenants rights. We bought here and were certainly motivated by the poor protection for tenants. We were moving to London and we have young ones and didn't want to be forced to move because of a likely rent hike.

I think making renting more attractive would take some pressure off the market.

But if it was £565k in 2012 then why is it £330k now?

2012 was a long time after the crash in 2007 so it's 2012 price should have reflected the price drops.

Sorry but I still think you are in cloud-cuckoo-land.

Prices here are still falling. I thought they were a lot of places. The guy in question is desperate to sell I think there is no market for big expensive properties as out of most peoples price range.

I think it is harsh how they said if we went in with my parents and they put in all cash then they arent allowed on the deeds or it needs to be paid off by the time they are 75. I only recently enquired on that and it seems like the stupidest rule ever. If they changed that in this country lots of people could have family mortgages and just carry them on like European countries.

I hope you are right Iseenyou!!

jasmine you are talking trash or have the most shite mortgage broker ever.

No mortgage lender would entertain your family members putting all their cash into a house and not being on the deeds, unless they signed to say they'd gifted you the money, so that should never have been an option.

Also, you said 'all 8 of my family' implying you have 4 children plus your parents, which means your affordability drops massively.

Also, the 8 times your £30k salary you've been offered and your £55k equity makes £295k so you're not far off buying a £330k house on your planet anyway, so wouldn't need much from your parents- so why didn't you do it.........

I'm sick to death of hearing my parents' generation sitting comfortably in their nice big detached homes that they bought for a pittance years ago, going on about how they've worked for it, interest rates were high at one point and the mortgage got expensive for a while blah blah. They are living much longer in homes that are way too big for an elderly couple causing stagnation at the top of the market. Families have nowhere to move up to so are stuck in small terraced houses which were traditionally either starter homes for newly married professional types or long-term homes for working-class manual workers/less skilled administrative posts.

This.

My FIL likes to hark on about how this generation wants everything RIGHT NOW and his generation worked hard so deserve to own the 3 properties each that he and so many of his contempories do. Gets the arse when I tell him that him sitting on 2 empty homes is the sort of thing that causes the problems we have now.

Jasmine I think you are off your rocker. Houses here just keep rising and people are fighting over family homes which is raising the prices through the roof.

It is madness.

I've sat it out and waited for years, being convinced that prices couldn't keep rising forever. Most of the people I know tbh thought we were 'losers' for not buying a house. The amount of times I've heard 'renting is dead money', 'you can't go wrong with bricks and mortar', 'my property is my pension', etc, I could tear my hair out. It turns out that they were right and I was wrong. I've hated having to endure listening to smug twats who think they've been so clever to buy a house and to be constantly told to buy now or I'll miss the boat. I really thought prices were going to fall in 2008, but the governments, both labour and tory wouldn't allow it. They'll do everything they can to keep all the plates spinning. HTB was a disaster and should never have been allowed. I wrote to my MP and told him that all he'd done was put prices up 20% which hadn't helped us at all. They're all a bunch of self-serving wankers who don't want their own property portfolios to collapse. They are all in on it and have vested interests in keeping them high, not least to keep us all as wage slaves till we die to pay the hefty mortgages to keep the bankers and the elite few rich. We are just dispensable slaves.

Cause I wouldnt want to pay that much out on a mortgage just because you can get it doesnt mean its a good idea. I was offered nearly double what I took out on self cert in 06 if I took that I would be living like a pauper. Same as I wouldnt get a large mortgage now its not worth the stress of livind hand to mouth.

That was what I mean my parents wouldnt gift it and live there and there is no way we could take a mortgage out in just dh and I and my brothers name but then have us 3 and my parents on the deeds. In Germany family mortgages are more popular I dont know why they dont have that here.

Nikki - Yeah I read in the paper there was lots of arguing and sealed bids in London. Its not like that here :/

Cause I wouldnt want to pay that much out on a mortgage just because you can get it doesnt mean its a good idea

Yet you claim your second mortgage was 8 times your income

Funny that yours is the only story of such massive income multiple mortgages being offered on this thread and you haven't actually proceeded with what you claim to have recently been offered in order to buy the cheapest 6 bed mansion in the country, and, critically, haven't suggested how any of that will help your children to buy homes.........

I was self cert and dh and I were both at uni do only 2 part time jobs but we lied but you were allowed then which I agree those days are long gone. We only lied and said 26k joint though and we were offered 260k. Our mortgage company was later sold off for being subprime no wonder really but that was through the broker. It was around he Northern Rock that most of my friends still have mortgages with!
My parents wont come in unless my bro comes in but he will no way pay off 80k in 15 years off his share as hes a bit of a what shall we say as he liked a champagne lifestyle on lemonade wages. Would of
been different if we were allowed to take longer like we thought we could and like other European countries. I think changing that would help future generations and I would definitely be up for doing it with my kids.

It's not even just about how much you earn. The ever-increasing numbers of people who spend decades desperately trying to escape the bloody fixed-term contract culture have no hope of being offered a mortgage.

Its not the cheapest you can buy a 10 bed guest house for 260k but you wont fill it unless you like. trying to make money off 100s of northern oaps sharing a tap water

But if you've really recently been offered 8 times your salary, as you claim, and you have £55k equity you only need £35k plus fees from your parents and brother in order to buy a £330k house- that could be achieveable if your brother only earned NMW.

You'd never actually be allowed to borrow that much but your story just doesn't add up and for the umpteenth time, it doesn't help your kids buy their own home.

The whole point was living with my parents though I would prefer my bro not to be in on it and just pay rent but my parents wont go for that. Hes always walking out of jobs I love him and want to live with him but dont want to risk him paying 80k off in 15 years. I think this thread shows lots of variations across the country down here its falling and stabilising, falling then stabilising etc. Dont think we have reached the local bottom yet. All my other rellies are northern should see how bad it is up newcastle. They have lost loads.

Sorry jasmine but I have to give up on you now.

I'm talking about how to help your children secure a home in the future and you're talking about moving back with your parents and brother- we have very different priorities.

Surely if there were easier ways to do that then the parents leave you the equity or as time progresses you can buy them out then your children can do the same. In Germany its really popular my nan in law told me that my grandad in laws relatives do it out there. It seems like a great idea to me.

But if you have 3 children and your brother has say 2, that generation will soon comprise 5 couples plus you, Dh, bro and SIL- are you really naive enough to think you'll all live like the Waltons together and no one will want to move from a place where the average wage is £19k in order to make a better life?

This thread isn't about what happens on the continent- it's about how to make the best of what we have. Wishing our system was different is no use to anyone.

I don't know but my parents, and DH's, possibly wondered the same. We have a large 3 bedroom flat 30 minutes train ride from our CBD which we finished paying off a couple of years ago. Prices are similar here - I believe it's the fifth most expensive property market in the world. I doubt we will ever be able to comfortably afford a decent house closer to the city but we do have a plan. We want to buy our 'retirement house' soon in a regional semi-rural hub where prices are considerably less (though still high for those starting out in those areas), rent it out and keep living in our current flat. When the kids are old enough to live by themselves they can live in the city flat to study/work/save up for a deposit and we'll move out to the house in the country. Not decided whether we will ask them to pay a minimal rent or not - would probably make them more responsible with their money if we did. Also, DH's parents will be quite elderly by then so we'll probably be spending quite a bit of time in their country. There are lots of multigenerational family homes again in my city now - partly due to cultural changes and partly due to necessity. My paternal grandmother's very Irish family lived like that and it served them well.

YANBU. The prices here in SW London are shocking. I rather stupidly assumed our current teeny 3 bed house was a stop gap until we had enough money to move to a 4 bed detached like the one I grew up in. It sounds embarrassingly naive and to quote a MN favourite, 'entitled' and I suppose it was.

The next step up the ladder would cost too much in stamp duty let alone the £200k+ difference between a 3 bed like ours and a 4 bed with a bit more space downstairs. However I love the area we are in so we are lucky.

Uselessidiot- I haven't got a pension, nor two pence to rub together for that matter, but I don't assume I will kill myself or starve to death: things turn up. And what's all this ridiculous "not a proper human being" stuff about?

I don't understand why you even open threads about money when it stresses you out so much- I seldom do; isn't mumsnet meant to be fun?

I get that almost everyone will have an off day and sometimes feel rather bleak, and perhaps letting it out helps. But revelling in misery, post after post? I don't get that. It can't be good for anyone, least of all you.

On this thread, like so many, I realise how mnay MNers come from pretty well of backgrounds. I am not sure all of those who do realise that their experience is not the universal one.