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?

yy to whichever poster said professionals are now living in houses that were previously occupied by working classes/minimum wage earners. Earning £100k as a couple by no means guarantees you a decent house now. Probably something very average.

My parents bought their first house on my dads salary alone, he was a newly qualified teacher on the equivalent of about £26k. It's now worth £350k - there is no way a single teacher could afford that now. So it wasn't always like this. DP and I are late 30s and each earn more than DF ever did, we can just afford a small 2 bed. I don't think it is expecting too much for a couple in the top 20% of earners to be able to afford a basic family home!

We (DH & I) have very low income jobs, DH works in a manual skilled profession 50hrs per week and I work PT at weekends in retail as we couldn't afford to pay for 2 lots of child care. Our joint income is under 30K and we have been paying between £800-1000 a month in rent since 2007.

I have personally lived in over 25 properties over my whole life ( not even 30 yet!) from council estates, refuges, care homes and private rentals. My worst experiences were in the majority in the private rentals! Both as a child and the one paying for the privilege, I have only had one good experience with a private rental, mainly due to considerate and responsible landlords who we still keep in touch with now.
Fortunately/Unfortunately we received a six figure inheritance which enabled us to buy with a small mortgage which is considerably less than what we were paying in rent.

We wouldn't have been able to buy without this windfall and we save Half of the difference we were paying for rent for our children as we know that they will definitely need a similar amount to help get their own properties when the time comes.

We have decided as parents to try and encourage our children to move abroad and broaden their horizons which we didn't get the chance to do as we started our family in our 20's.
I don't believe that the UK has much to offer young adults now, let alone in the next 15-20 years,, maybe we will sod off and travel around when they fly the nest, who knows! I just want them to be secure and happy.
Moving around a lot considerably ( not often due to choice either ) added to my anxiety levels and I hope having our own family house will add extra security to our children's upbringing.

We have bought in the SE 30 mins on train from London and do not think it is likely our house will decrease in value, so hopefully they will get a good amount in inheritance, even if we downsize and need care and end up having to pay for it the amount we are saving having bought means we should have a healthy financial portfolio by the time that is something that needs to be addressed.

That's not remotely funny boef. I could never kill another person.

Can I just mention here with regards to Objections postI dont think the issue is nearly as apparent if you draw a line above say Northampton. I look in my old home town in the Midlands and you can still buy a perfectly nice 3 bed semi for around £135,000this is doablesame in Manchester and I have seen nicely done up terraces for £100,000. Problem is when you get below that line (apart from far out areas in Wales etc) we live in Oxford at the moment and rent admittedly a biggish family home, its a very nice house but in reality totally unaffordable (but was the only suitable thing available and ok for sons school during GSCE year after last landlady decided to sell after 12 months) , we are moving shortly to Bristol and will be paying £1850 a month for again a fairly nice family house in decent area, expensive yes but an absolute bargain compared to here. We are self employed and earn reasonably well but saving the £120,000 we would need in these areas for a deposit as well as paying high rent is not going to be possible and even then we would still have a huge mortgage and at 50 its not doable over a short period. Go and live in a crap and cheap area you may say, sorry, no Im not that desparate to own that i want to either buy or rent a 2 bed flat on some sink estate and hubbie def wont do that- so Ive learned to live with the situation. If we inherit then we may buy at that point but not before. Go and live up North you may say, this is also difficult as we work in a business that although we can live anywhere does require a fair old few trips to London, often several times a week and we dont really know anyone either in those areas. It isnt as straight forward as many people think, and certainly if you live "down south" and havent been gifted money then its not easy at all. I personally would bring in rent caps (they have them in many countries) and it would take the housing benefit bill down dramatically and I would also bring back the "DIYSO" scheme on a huge scale. We bought a 1 bed flat when we didnt have our son on this (do it yourself shared ownership) and it was a great thing. You could buy anything on the open market (not just newbuilds) and it was a straight 50/50, you bought 50% with a 5% deposit and the housing association owned the rest, it also meant that you didnt end up paying overinflated "newbuild" prices for crappy flats. The government could actually set up a whole dept and be the 50% owner. It would mean even in the totally overpriced south you could pay £250,000 , have a £12,000 deposit and still get a good family home. If you then had some good luck or came into some money you could gradually up your share and profits were split 50/50 after allowing for any improvements you had paid for. It was estimated for 50 billion you could get 1 million take up and thats a lot of homes and the government would have a significant investment too--all for the estimated price of something un needed like Hi Speed 2!!

My fixed rate deal runs out this year. I will probably be letting it drift over onto SVR rather than fix another deal with the same/another provider as under the new rules it is doubtful that I will qualify for any kind of mortgage, let alone one that will cover the amount I need. This is despite 10 years of payments, a 70% LTV ratio in my favour and an unblemished credit history. I just did the online calculator thingy and it will offer me no more than a 1x salary multiplier.

I think there are going to be a lot of desperate and unhappy people in the next 12 months. I suspect the rules will be downplayed after that as politicians put increased pressure on the FCA to do so realising the effect this will have on voters.

I moved last year and have had a lot of young tradesmen in doing work and have got chatting with quite a few. They tend to be around 23 to 28 and have all brought or are buying nice houses. I am in the south East. one guy who is an electrician and his girl friend a nurse have just moved into abeautiful three bedroom detached home in Essex. he showed me a photo and I was expecting a small starter home type place. He said they both lived at home and have been saving like crazy for a number of years, he had just turned 24. I cant help thinking the amount of people now going to university is not necessarily a good thing if someone does want to buy in their 20's.

"Go and live in a crap and cheap area you may say, sorry, no Im not that desparate to own"

We bought our 4 bedroom family home in a very unpopular, down at heel part of London. (north Croydon) 13 years ago. A 'crap' area.

Do you know what? There are many, many nice people here. It's an easy commute (3 minutes to the station then 20 minutes to Victoria). The schools are well run (they may not get the best SATS results, but that's because of the intake, not because of the teaching). It's well served for shops, hospitals and transport.

And yet I read posts on mumsnet where people sneer at the area as somewhere where they wouldn't consider living.

'Crap' areas tend to become 'crap' for the same reasons that some schools are thought of as 'crap' - because educated middle-class people give them a wide berth, so they're disproportionately populated by the poor. They become polarised.

To those people who aren't able to buy in middle-class areas - I have no sympathy. Take your money, your energy and your community spirit into the poorer areas, where you can get vastly more property for your pound.

Regarding the comments about previous generations- how much of this has been researched and how much is guesswork and assumption?

I've traced quite a lot of my family tree back to the mid 19th century and it doesn't seem as if most of my great to great x3 grandparents had too bad a housing situation.

Both me and my parents now all 'live in poverty' with none of us owning a house outright, to put this into context.

Eg around the turn of the century my my GGF bought sons flats- not just deposits.

My mums wedding present from her parents was a country cottage.

My DGM owned a cottage in only her name back in the 40s.

Other examples I've found follow similar patterns. These people weren't rich, just shop keepers/farmers etc. ordinary jobs. So it's a myth that no body except the v wealthy owned homes before mid 20th century.

Part of the problem is that BTL investors are able to leverage their existing portfolio in order to borrow more, so it becomes easier for them to pick up a 3rd, 4th, 5th property. That means that the chance of buying a cheap "doer-upper" (as my own parents & those of many I know did) are very slim, as BTL investors are often able to move faster and are therefore a lower risk option to the seller.

Those BTL investors can then rent the very same house back to the people who were hoping to buy it in the first place - but at a rate that also covers some profit.

I can only see this getting worse for my children's generation, as more and more houses are tied up by investors.

I bought at the very top of the market in 2007, and had a 100+% mortgage at a 5+ income multiple. Even though I went through a subsequent period of having negative equity after the market went down, I still consider myself lucky to have bought in time, because there's no way I would have been able to save up the deposit that's now required.

Thankfully now the market has moved up again & I've got a reasonable amount of equity to be able to look at moving on.

Realistically (taking into account increased cost of living, wage stagnation + increased student debt), I think that my children will need to rely on inheritance from their GPs in order seriously contemplate buying.

weatherall - Of course they were well off. Farming and shop keeping were in the past, often very well paid jobs to have. Ordinary people worked for shopowners and farmers. Farmers used to employ lots of staff before the use of massive farm machines. And even being a shop employee in a "respectable" store, was before the second world war viewed as a lower middle class job.

One thing that does surprise me, though, is that the crazy London market hasn't spread further. I live in the midlands, and we're on a train line with a sub-1hour direct train to Central London (oh, and both one of the top grammar schools and one of the original 7 public schools...); yet you can pick up a 3 bed terrace within 1/2 mile of the station for £120k.

I mean, great for those of us who live here, but it surprises me that more people aren't looking to move out of London.

Pounding I'd get yourself to a mortgage advisor - different lenders appear to have wildly different criteria now. I'm looking at moving at the moment, and based on the calculators I've been offered between 1.25x and 5x my salary, depending on the provider. And that's with a much lower LTV than you have. IIRC 70% LTV would start getting you some pretty decent rates.

You'll be the lowest paid pharmacist I know then!! My lodger is a pharmacy tech and she gets paid more than that!!

On working your way up - you might work in London and buy the £100 flat in Luton for example or £130k flat near me in zone 5 London. So how over 30 years of owning can you "move up"? It has always depended on your work.

My grandfather (who lived with 26 other young men in 1901 in the NE) eventually bought a house a bit like this on this road - today they sell for £100k www.rightmove.co.uk/property-for-sale/property-21293295.html. He and his wife lived there until they died. They didn't move up. My grandmother never owned a house. As I said up the thread my parents could not buy nor have children for over a decade after they married and even then it was a huge stretch. They did manage a detached house ( no central heating at first) and the lived there until they died.

I instead moved up - tiny terraced, then semi, then detached (then when my own business took off so well big detached), never easy, always a struggle, over £1.3m of mortgage debt at one point, not much fun, no maternity leaves, 30 years with children working always full time, but worth the 3 decades of struggle it took from the first purchase to have the house I have now.

The interesting bit though is how inflation and wage rises (or falls) have an impact over the years. We sold two buy to let flats for half what we paid for them after a property crash in the 90s. It is not always plain sailing with huge gains made. There was also before my time a dreadful property crash in the 1970s when people lost a fortune on property.

How did we move up? I picked a profession where pay rises which is probably the most sensible advice you can give to any woman - pick your career carefully. Secondly, we were both very careful with money, saved where most people spent, any spare money went off to paying off debt in the few years later when there was spare money. I've just about never bought new furniture and not because I inherited antiques but because we used second hand junk stuff.

The hardest issue for young people now (and it was pretty difficult in my day - I never had a penny of financial help towards a property purchase even with my first aged 22) is getting the deposit together even with two people with full time salaries (which back in my day you had to have to afford - one salary has never easily bought a property in the SE at any stage). So you want to buy the £100k starter small flat in the London area. You need to raise £5000 under Help to Buy or try to find a 90% mortgage with one of the banks and raise £10k. Let us ay £5k. So each person in the couple needs to raise £2500. I don't think that's that impossible. You start grotty and small and at least you've got your foot on the ladder. If you both earn say £25k that's £50k x 3 = £150k. So yes you can get your £100k small flat.

It's just some people are too snobby or entitled to be able to slum it in zone 5 London or Luton. They think they have a God given right not to commute.

Minifingers, I totally agree. What grinds my gears is people who complain about being unable to buy but who aren't prepared to go out of their preferred area. I hear some people in the office moaning that they can't afford to buy, but it's Clapham or Balham only for them!

We bought in a similarly down at heel area in London (Lower Clapton) 7 years ago and lived there happily. We've now moved out to the suburbs and to a nice house but it was only because of how much that 'crap' area improved (and 'crap' areas tend to go up faster than those who are already sought after - e.g. Hackney was the fastest rising borough last year) that we were able to do so. It isn't only sensible (and less 'entitled' and princessy) to look at less popular areas, it can actually be financially better for you.

On the commuting front, some of the 'bad' areas are just as easy to get to and from the centre of town. When you hear people turn their noses up at some of these places, it makes my blood boil. It's just snobbery. Well, guess what? You'll still be renting 5/10 years from now and I have no sympathy.

I answered that hours ago justtoo there's no need to repeat yourself.

I know what you mean mini and dilly but I rented in a truly crap area of London for a few years recently having escaped last December so I can also understand about the 'snobbery'. Did prices go up whilst I was there? Yes, but only by a relatively tiny amount. If I'd been in the position to buy I wouldn't have ever considered it there, in terms of an investment or as a decent place to put down roots. I don't know what areas the people you're talking about turned their noses at but there's some utter dumps here in London (and I mean much worse than Lower Clapton circa 2007 - I used to live nearby).

I feel we were just in time to be able to afford a family home, buying in 2000 outside of London (with savings/inheritance to help make this possible, and after about a decade of renting as we moved around including living in London)

I feel this house is now an asset for us to take into retirement when we may largely rely on state pension, and also will continue to be a base and home for currently teenage DC for as long as they need it.

Basically I don't expect my DC to move out and be independent from 18 as I feel was somewhat my parent's expectation of things.

Whoops, always difficult to remember to use that apostrophe after the s don't you find ?!

I hear alot of snobbery about Lower and Upper Clapton even now. Renters saying they'd only buy in Stoke Newington, or London Fields. They are living in a dreamworld. I've lived and bought in worse areas than Lower Clapton too (e.g. darkest Dalston a long time before it was cool). I also think people need to see it less about putting down roots and more about just buying property, which usually goes up in value rather than down (and if it goes down you wait it out) and in any case allows you to pay off a mortgage rather than waste cash.

Our road in Clapton was probably the key road during the riots (shops ripped apart, cars on fire, right next to Pembury Estate etc). We had two children aged 3 and 1 at the time and couldn't leave the house for 24 hours. Not ideal but there you go. We sucked it up and kept the kids safe and then when we'd paid off just enough mortgage and the place had gone up just enough in value, we moved out to a cheaper again but much nicer area. Now we have a long commute but again, there you go. It's about compromise.

Of course, there are some people who can't even afford the less desirable areas these days and they are obviously the ones we should really worry about, not the people who simply want a nice postcode.

Never mind the kids, what about us? I'm 40, and I may be able to own my own home in a couple of years - if the prices don't go up, if interest rates don't go up too much- if I'm lucky in short, and historically my luck has been limited. At that age I've run out of time to wait this bubble out.

Funny how some people thnk 100 K isn't too bad and is affordable - how are you supposed to save a 25 k deposit when you've been paying rent for 20 years? Just 20 years ago those 100 k houses could be bought for less than 30k. Have wages gone up 3-4 times and no one told us? Didn't think so. Some people are just so rich and don"t know it, and haven't a clue what it's like to live without money, or this 'mum and dad' bank I keep hearing about. Never had it, not got it for our dcs.

Incidentally the myth about home ownership being uniquely British is outdated too. It's about as common now on the continent as in Britain, maybe more so. In belgium the authorities actually say they encourage it, because - guess what- rent is dead money and leaves you withnothingto retire on. Though the stories about renting being a better deal in Netherlands and Germany are spot on - they still have a large social housing sector in nl ffs. In belgium it's a bit better, more security, but tenant does maintenance.

I agree Dilys and mini to a certain extent. I hear people say they want to buy a family home as moving, stamp duty etc is expensive but if you are willing to climb the 'ladder' ie start cheap, pay off mortgage and continue to save you could eventually have your 'forever' home. Dh and I landed in London with a packpack each, one suitcase and not much money so I know it can be done.

And stop with the Boomer blaming, it's ridiculous.

Backpack...though I like the sound of packpack....

I was the one who mentioned £100,000 for the London flat (slumming it out in zone 5 where I live) or £275k for the 3 bed terraced in the same area which was affordable just by we two professionals 30 years ago and is affordable just now for two similar professional in a couple in 2014 who in today's terms would earn about £40k each. Even going back 30 years average earners could not afford that terraced but could afford the £100k flat. If you both earn £25k you can probably get a 95% (help to buy) or 90% ordinary loan. Yo need to raise £2500 each for your share of the 5% deposit under help to buy. A couple both on £25k in London can probably afford that.