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?

Sorry- I missed the date- It was fairly irresponsible then, it just won't be allowed now.

The new MMR rules are way more restrictive. They now analyse all your expenditure, including childcare costs.

If they count your childcare costs I dont see how they cant count your tax credits/cb else it wouldnt make any sense if say your only chipping in 30 or so a week of your own income. If they arent counting cb as its not guarnteed for 30 years then why count childcare costs are only expensive for a few years. Be interesting to see how this works in practice.

Here's an article about MMR (usual caveats about sources)

www.theguardian.com/money/2014/apr/12/need-mortgage-new-rules-lenders-check

I saw it the other day but I mean I get 760 in tcs but my full bill is only 950 for 2 in full time care so surely they will count that as they always have else it wouldnt make any sense.

If they count your childcare costs I dont see how they cant count your tax credits/cb else it wouldnt make any sense if say your only chipping in 30 or so a week of your own income.

Sense doesn't really come into the MMR regulations- it's essentially arse covering and looking at worse case scenarios without factoring in any upsides.

If you actually managed to secure a mortgage for 8 times your salary now I'd gladly eat my hat.

The point I've been trying to make and the reason it worries me, is that it all seems to be closing in:-

House prices are going up
Wages aren't going up in line
Final salary or any half decent pensions are virtually a thing of the past
The parents of today's babies don't live in big houses so won't be able to downsize to release equity
You can't over stretch yourself on a mortgage anymore (no bad thing)
Cheap houses are generally cheap for a reason- bad area, poor transport links etc.
Cost of living is more expensive and things like mobile phones for kids are practically essential which they never were in our childhoods.

so surely they will count that as they always have else it wouldnt make any sense.

jasminemai you're just not getting this- what has happened in the past means nothing now.

That's why it's such a concern.

Just looking for these affordable houses in the South - trying a 40 mile radius from home, so far have found garages and beach huts in the Isle of Wight, and a couple of holiday park homes - bit tricky when you work in North Hampshire :) (Will keep on looking till I get to the actual "normal" houses/flats)

It says on there a couple of 35k can easily get 175k as long as they arent wasting money on takeaways and wine clubs and have money left at end of month. Its not anything to get worried about in a lot of areas, although it would be in London.

Ds1 is 20, and is in the second year of his law degree, and he is already worrying about whether he'll ever be able to afford to buy or rent a house/flat. He knows that he will have to rent, in a house share, for some years to come.

Yes jasmine but that is for our generation.

The whole point of my thread is about the next generation.

I don't doubt our generation can still buy their own home but for many it's going to be a stretch.

If you fast forward 20 years, continuing with similar house price v wage increases and the lack of downsizing, big pension options- what will our children do?

Its

SDT but renting in a house share for years is quite normal. DH and I did so until we were 30. I don't really see it as an issue.

Not being able to afford a family house to settle down is the real problem.

OP - I agree with most of what you say. I think the problem is that people now have the expectation of being home-owners, whereas my grandparents' generation lived quite happily in social or rented accommodation. People on low incomes have never been able to afford to buy. It's the first time that people are not able to match what their parents were able to afford.

On the other hand, I'm continually amazed on here by what people spend on weddings, hen weekends, children's parties, nights out, takeaways, presents. Seriously, when you talk about the cost of living, neither my parents nor I would ever have dreamed of such extravagance.

I totally agree about the extravagant cost of living thymeout.

People generally aren't as frugal as our parents were and there is a scarily prevalent mentality that the things you mentioned are actually necessities.

You would think MMR would slow down the price increases, in fact I'm hoping they will, but who can really know?

You would think MMR would slow down the price increases, in fact I'm hoping they will

Me too, but I fear that they'll only slow the increases, not reverse them.

Yes, there's a lot of spending on consumer goods, but the sad fact is, even if you reigned it ALL in, it's still not going to be affordable to buy a house on low wages.

I think there's a bit of a 'fuck it' mentality because of that apatite1

Some people think they deserve all those things because they can't afford a house.

Yeah, it's not how we live, but honestly, I can't blame them. Why save for something you actually have no hope of ever obtaining?

"People generally aren't as frugal as our parents were and there is a scarily prevalent mentality that the things you mentioned are actually necessities."

Really?? wedding? Nope. Hen weekends? Nope. Takeaways? I never go to the hairdressers, have no gym membership, no car. At least my folks had a car!
When I grew up in the 80's, even on the average council estate everyone went to Spain once a year and ran a car. My grandparents owned a house (which they sold once they got a nice convenient council flat), they had holidays, bought nice clothes.
Things are going backwards. We had a roast today. That was an extravagance, and I felt guilty because we should be living on cheap food.

Once energy is paid, water, Internet (a utility now, like it or not) school dinners, council tax, rent, life insurance, xmas club (so I don't go broke in January) home insurance, bus pass, food, there is , if I scrimp, about £100 a month for savings.
Which is great, but it won't get me a deposit on a £120k house, which is the cheapest ex-council place available where I live.