to feel screwed over by our society, can't afford a home, can't afford children, can't afford car

[Lauranda]

I'm in my early 30s, had a great up bringing, do a job I like and got married last year. I do feel very lucky.

However where we live in the south east, all we can afford to rent is a badly converted 1 bed flat with a damp problem. Can't really save much and are very economical with our money so can't see ever affording anything bigger and could never bring up a child here.

My parents managed to get a large 4 bed Edwardian house on one sallery when I was growing up and dads job level was about the same as dh. No way could with double sallarys afford anything near that lifestyle.

Parents keep saying my time will come, but looking at the statistics that seams very wishful thinking. Parents have kindly offered 15k to help get a house but to be any use would need much more than that and to pray interest rates never rose much.

Am I alone in just being unable to afford children even though we both work full time?

"People have swallowed the idea that simple things like 'childcare on tap' from grandparents, or being able to live within your social network, is somehow this unobtainable rarified entitled existence. It's not! It's normal life.

What the hell is this country doing? Why does everyone just tug their forelock and accept it?"

Low self esteem? I have no idea Bog, but it is quite true that this country is stuffed to the brim with forelock tuggers, who seem pathetically grateful at being allowed to exist.
I think we should all have MORE of a sense of entitlement.

Fraidy I think that is missing the point. Yes prices are much higher compared to earnings but you can borrow more multiples of earnings and interest rates are far lower so higher borrowings are more affordable than they were.

you can afford higher multiples because interest rates are so much lower now

I'm not sure I agree with this. I think the real cost of interest is fairly similar regardless of the rates, for example long ago 12% interest minus 10% inflation equals 2% real cost of interest, while nowadays 4% interest minus 2% inflation also equals 2% real. So you always pay some low percentage as "rent" on the part of the property that isn't paid off, and the real issue is paying off the capital, which is now 5x your income instead of 3x, so you are a lot worse off nowadays.

Of course you are paying 2% or whatever on a bigger loan relative to income, so in fact the interest-only part of the equation is also worse.

so higher borrowings are more affordable than they were

I am assuming that by "more affordable" you mean lower interest rates result in better economic deals, not just that they facilitate bigger borrowings.

If a dodgy lender offers me extra money on top of what I can get from a reputable one, on condition he's allowed to cut my balls off if I don't repay on time, then in a sense my increased borrowing capacity means housing is now more affordable for me. However I don't think that a sensible way to define affordable.

Lenders used to lend less against salaries. So mortgages could physically not be as high in relation to multiples of salary as they are now.

op, you seem to be saying your parents want a say in where you live or they wont give you 15k to help out...and moving back home would cause you mental health problems (I know that's tongue in cheek as above post earlier)

so why do you want to live near your parents so they can help with childcare?

can you see what I'm getting at?

live your own life, make your own decisions and if you have kids get on with it without expecting your parents to sort it all out for you, I think you'd be happier that way.

FraidyCat - I don't get your logic. If you had a £100,000 mortgage in 1991 at an interest rate are 14% a mortgage would cost £1,204 per month (if 25 years repayment). Nowadays as interest rates are much lower (e.g.3%) a £100,000 mortgage would cost £474 a month. What have inflation rates got to do with it?

Iseen headline income tax rates are lower, but marginal tax rates are not actually particularly low - recent govts have loaded up rates of NI, VAT etc. which have all increased a huge amount.

whatever but if real property values have tripled since then, and FTB interest rates are closer to 6 % (hate to break it to you but first time buyers don't get rates of 3%...) then a £300,000 loan at an interest rate of 6% is more than a 100,000 loan at 14%. And wages have decidedly not tripled since the 90s.

Traininthedistance- I think you have misunderstood my point. I wasn't trying to suggest that it is easier to pay a £300,000 mortgage now than a £100,000 mortgage in 1991. I said a £100,000 mortgage would be cheaper now than it was in 1991 and therefore you can't just look at house prices and median earnings in isolation when assessing affordability.

I also don't get FraidyCat's point that the real cost of interest is fairly similar now compared with 20 years ago given that a 15% interest £100,000 mortgage would cost £1,281 per month (if 25 years repayment) whereas a 6% interest £100,000 mortgage would cost £644 a month. What has the inflation rate got to do with it?

OP, I live in Southampton and my house (2 bed mid terrace Victorian) is valued at about £130k. There are similar in my vicinity for sale at a lower price asd they need doing up (like ours did 5 years ago - we paid £118k)

With the £15k gift and under the Help To But scheme, is there nowhere near you in that price range?

whatever but if you can't buy the same thing with 100,000, then it is relevant.

And google "real interest rate" and "negative real interest rate" to understand Fraidycat's point.

We were stuck in your situation, OP, about 8 years ago when we first got married and were living in the UK. The city we lived in was expensive - average house cost about 10 times the average income and even that amount of money wouldn't get you much, you had to go about 100k over the 'average' cost of a house to get somewhere decent. We were earning good salaries, above average, but not brilliant. It seemed a very grim situation. We had no family help either.

We saved as much as we could, lived below our means (i.e. renting a tiny 1-bed instead of a 2-bed or house) and DH did consulting outside of his normal job to earn extra money and I pushed for a pay rise at work. We managed to save about 40k over 3 years. Even then we still couldn't buy where we wanted but had to buy a house about 10 miles outside the city. Thinking about having children was really daunting. It didn't seem possible as we had no parental help and childcare was very expensive.

Now I look back and realize that the situation was indeed stacked against us as people who were too young to buy at the right time, had no parental help and lived in an expensive city but we just did our best to work around our situation. DH used to go on and on about how unfair it was that we had to work so hard and scrimp along to get what his parents' generation had so easily (true in his parents' case) but I"m not from the UK so I had different expectations and also decided that mulling over the unfairness of it all was pointless. It was just a waste of energy.

As it turned out, DH was offered a job abroad and now earns about 5 times what he did in the UK. Where we live now is still a very expensive area for housing but we are at least in with a chance here as he earns a lot of money. When I look back at our situation in the UK we were wasting our time struggling with an unfair economy but that was just how things were. The best thing you can do is sit back, assess your situation, set yourself some goals (buy house / have kids - whatever has top priority for you) and find a way to achieve them. You will have to try harder than your parents did but, as I used to remind DH, it could be worse. You could have been born in 1925 and have to go through the Great Depression, WW2, rationing, bombing etc!! We might be disadvantaged compared to our parents' generation but we are lucky compared to our grandparents' generation.

whatever but if you can't buy the same thing with 100,000, then it is relevant.

Irrelevant to what? It's not irrelevant to the point that it is misleading to just look at median earnings vs. house prices in isolation!!!

And google "real interest rate" and "negative real interest rate" to understand Fraidycat's point.

I know what "real interest rate" and "negative real interest rate" is thank you. That doesn't explain Fraidycats point that the "cost of interest" is similar now for mortgage borrowers as it was in 1991.

curiousuze have a look here If you don't fancy the seaside, then West Norfolk (around King's Lynn area) is quite cheap too. A 3-bed terrace in Norwich would be more (about £130K).

YANBU to think that you should be able to afford a house, but YABU to think you have it worse than previous generations.

You just have it worse than the previous generation in the SE. In the rest of the country whole communities were broken up, with many people having to move in the eighties. Many of them had to move to the SE.

Now many people are moving to those former communities to afford a family. Very few people get to stay in the same part of the country or even the same country for generation after generation. How many of us have Irish immigrant ancestors?

I'm 45 and no way could I have afforded anything but a small flat in a provincial commuter town as my first time buy. DH had a 1 bed flat when I met him. Combining the two of these plus the fact we had both both cheap as they needed a lot of work gave us the money for a two bed house, and now we have almost finished building our own 4 bed house. No-one helped us with the deposit either, but like NearTheWindmill we both worked hard and saved from 22 - 33 to buy our first small flats.

Why do people think they should be able to buy a 4 bed family house as a ftb?

In your position, I'd probably buy in a cheap part of Kent or consider changing my job to work and live somewhere cheaper, or even emigrate.

And I'm going to get crucified for this, but how well paid a job can you get if you cannot spell "salary" or the know that the plural, along with many other words ending in "y", has "ies" on the end?

We used to live in SE and I loved it (DH who is a southerner didn't love it so much, though). We couldn't afford to buy there and we moved to the Midlands. Now on 2nd and hopefully 'forever' house and have DS, no regrets at all. England is an amazing country and some parts are more affordable (and underrated) than others.

Oh now steady on Chelsy!
Apart that and the seams/seems error the general standard of literacy appears to be perfectly acceptable

At the end of the day, we live and buy homes according to the time we were born. Whether it is fair or not, it is how it is.
OP the situation might not seem great, but you do have some choices. You have 2 incomes and the offer of £15k. You can find objections to movi g to a cheaper area, to accepting the £15k etc etc. you don't have to do those things if you don't want to, but there are consequences. You could live in your current flat and have a baby.
It doesn't seem that a house SOMEWHERE is out of reach for you, but it might not be near or as near family as you would like. At the end of the day you have to compromise own something and decide which things you value most highly. You CAN have a family anywhere, but the size of house will be determined by where you are living. Seems like the big question for you is whether to stay where you are and accept small rental into the long term, or move and be able to buy somewhere, which you maybe able to trade up later. If it is crunch time for having children, you need to make the decision and then accept your situation, whilst perhaps trying to increase your income and reduce your expenditure. Whatever you choose, you need to see it as a way into the medium term future, that you are going to feel satisfied with. Feeling life is unfair will not help. Finding the best option for you now will.
Best of luck with it all.

I'm 50:50 on this one.

I have some empathy for you OP as I'm the same age and I do think our generation has been hard done by compared to our parents (baby boomers in my case, not sure about yours). However I think the choices you have made (reasonable or not) have contributed to your position of being unable to buy a house. I'm not judging you for them, it just is what it is.

I'm 32, we bought our house 4.5 years ago, we have been together 13 years & married for 5, we have our first baby on the way & I will be 33 when it arrives. We lived in London in our 20's and lived in share flats & saved towards a deposit. (We don't live in the UK but we live in a city & country where housing is severely unaffordable (worse than London on most levels - btw don't count on emigration as an answer to your woes: houses in Sydney, Melbourne, Auckland are all v v unaffordable).) I also graduated with 35,000 pound student debt, 75% of which I have now cleared. My parents are not in any position to help us out as they have their own financial troubles, DH's maybe are but we would never ask.

We are both in well-paid stressful full time jobs. I chose to train for this job as I knew it was well paid, even though I would have preferred journalism or comms - I wanted to earn good money, I knew I would not get any financial help from family & this was the best way of doing it. Caring is an admirable career choice & hard work, I definitely agree with you, but it's never been well paid (the politics of that are another question) - I doubt a carer would have been in a position to buy a nice house a generation or two ago either. I would like to set up my own business, as would DH, but we need the certainty of our salaries and employee benefits (e.g. maternity pay) at this stage in our lives, with a big mortgage & a child on the way.

I don't want to lecture you - but there are different things you could do (retrain, DH seek full-time work possily if biz is not going well, move as some have suggested) to get yourself where you want to be. You are not as unlucky as some with 15,000 quid on offer either.

On reflection:

My grandparents (born 1914 & 1917): left school at 14, never owned a property, never drove, went on one foreign holiday in their lives.

Our parents' generation: university/careers mainly in teaching/access to mortgages/ran cars/regular foreign holidays (even the ones that stayed in blue-collar jobs managed the car and the holidays).

DH and I (born in 70s, Gen X): university (me, before tuition fees)/jobs not careers/private renting for 10 yrs, then moved to cheaper part of country to buy and still needed some help from MIL with deposit/don't run a car/don't holiday abroad (can't really afford more than daytrips in UK either).

DS: ???

It's been said before, but the 'golden generation' above us did particularly well and the future may look more like the past