AIBU to wonder how people afford huge mortgages and we’re struggling to make ends meet?

[Beanbag12]

AIBU to wonder how people afford huge mortgages and we’re struggling to make ends meet?

We live in a very affluent area in rural Oxfordshire. We rent. The idea of saving for a 10% mortgage is so completely unrealistic as the cheapest 2 beds around here are £220k. We currently spend more than our wages every month (high cost of living, childcare costs). Everyone, and I mean everyone that I work with either already owns or are buying hugely expensive houses. They’re on similar wages to me. AIBU to wonder how the divide between us is so big?

I know this probably has obvious answers; we should have been more sensible when we were younger, inheritance etc. but I’m interested in other’s experiences in this.
I don't really want to divulge any more information about our situation and I don't want advice (I know people will say it's our fault we're in our situation, which I am willing to accept, so no critisism please)

Saying everywhere you have rented before was cheaper is a bit misleading unless you rented the whole of an HMO.

Sorry, i'm being slow. I don't understand what you mean? I meant everywhere i have rented i would never have been able to afford a mortgage on. So i rented a flat in Brentford for £800 per month but the mortgage old have been more like £1200. The flat i rented in Mudchute was £1295 a month, but would have been a mortgage of about £2k. The house we rented out in MK rented for £100 per month less than the mortgage was for us. So it cost us to rent it out. But it was in neg eq and we took the hit while it went back up in value.

And the flat in Sevenoaks would have been astronomical with a mortgage but was £1350 per month.

N one is saying it is easy but we are no where near back down to the average 80% renting we used to have; we remain well above that. I agree though that it is not an aim to return to the higher levels of renting as a Conservative (everyone who can vote particularly londoners do go out and vote today no matter for whom you will vote)...... and capitalist I think owning is good for people and societies so I am certainly not advocating the 200 years + my family rented with 10 children in one up one down or two up two downs never mind the days with one family per room in tenements.

So in terms of advising your teenagers

1. tell them to buy before they have babies which is what 4 generations of my family have done in order to buy and it does work.

2. obviously try to pick the better paid jobs when you are a teenager picking careers, not following your "passion" or heart into something which will never earn you much money

3. compromise - most of us on here who bought compromised in terms of place, area etc etc - avoided the lovely rented place in zone 2 and bought the hell hole in zone 5 with the massive commute

1. buy with your partner/husband on two full time wages as my parents did with both of you working full time

1. Don't rule out the North. We have relatives perfectly happy in Sunderland, near Halifax, near Leeds. There is nothing that says you need to live in SE England or where houses cost more than elsewhere.

On the statistics above I think my off spring could borrow over 4x salary and is paying under 2% interest currently fixed for 5 years.

Xenia, i do take your point, but if your on your own its even harder and not everyone is clever enough to go to Uni or train for well paying careers
. My family all live in Essex and Kent, my children do not know anyone at all up north, they probably wouldnt want to move away from everything they know and everyone they love to live on their own in order to get a home - they should be able to afford a place closer to where they come from and close to their family - my son is saving hard but its going to take him forever on his own - a lot of 25 to 27 year olds that i know are not even bothering to save up, as they think ' what is the point' and interest will go up again im sure.
DS2 is back from Uni soon and will have lots of debts to pay back and wants to try and find a job in the city, which is loads of fares to find - he will have to start saving up and might get enough by the time he is 30, by which time the prices will be even higher.
I not being goady, but so many young people i know are having problems, not many of them have moved out and i cant see them doing so in the near future. ( even renting is expensive )

We did it ourselves.

Got married in 2006 and then lived like misers for eight years off DH's income and saved every penny of mine.

Because of our age, we realised that we had to buy a few rungs up the ladder (ie. we couldn't really go for a starter flat).

We saved enough to get a 75 percent LTV mortgage on a large semi and bought in 2014. When we moved in, we had a bed, a desk and a shitty cheap IKEA sofa. That was it.

Those miser years were absolutely miserable. When I look back, I'm cross that my 30s were spent living that way. Of course, when we finally bought the house and moved in, it was getting a bit late for starting a family because I was heading towards 40. Then I discovered I had a pregnancy condition and needed invasive treatment to carry to term.

It has all turned out okay but, with hindsight, I should have made very different choices. I always blamed myself for not earning enough (so I took every extra side gig going on top of a full time job, leading to cycles of burnout), rather than realising that I was swimming against the tide.

5. Don't rule out the North. We have relatives perfectly happy in Sunderland, near Halifax, near Leeds. There is nothing that says you need to live in SE England or where houses cost more than elsewhere.

Wow. Just wow. You have relatives 'perfectly happy' in the north?!

Wow. Spoken like a southerner. That one?

Why should people move to a completely different part of the country if they don't wish to? One of the issues driving the problem is the insistence of developers building luxury 4 bed houses in 'nice' areas and forcing out people who have lived in the same area for generations. This destroys the fabric of communities and the lives of extended families. How is that a good thing? Its part of the problem with today's society.

There is a need for boring small first AND second tier houses.

The first and second tier of the market are under particular strain because even if you can buy a house, a stagnate market in many places means you can't move up any higher. Especially when many older people are also downsizing.

Outside the SE where prices have continued to increase, there is a particular issue with people moving up from the south with equity they have got from property in certain areas. Locals have not benefited from rises in equity and are being forced out.

There is a certain resentment building because of that in some places.

All its doing is pushing the problem elsewhere because the south doesn't want to deal with the problem. This impacts on those at the bottom who find it increasingly hard to get anything at all.

Saying just move, is bloody great. If you can find the job to do that too. My mind seriously boggles. Not to mention you kind of need lower paid workers in the SE. By that I mean young professionals in jobs like, erm I don't know teaching and nursing not just minimum wage.

No just build more fucking houses of the right bloody size and not with help to buy which is a con, which pushes up land values and makes developers more money because they can justify building bigger properties which distorts the housing stock available and doesn't solve problems at the bottom end of the market. Its only available when the property is initially built too. Help to buy sounds great but the people who benefit most are the developers.

Seriously the problem is not hard. There is a problem with NIMBYism. There is a problem with a british aversion to flats. In Europe they are much more popular outside cities, but the problem here is a lot to do with leasehold agreements and extortionate fees which have left residents with few rights as they are so unregulated and can skyrocket without warning.

I am sick of all the parties sprouting bullshit about this.

We don't need any fancy schemes nor luxury houses. Just lots of good quality little ones.

Its all circumstances really - i bet lots of people have so much help from bank of mum and dad and dont like to say, or they meet someone who already has a place, or an inheritance from grand parents or something.
I knew somebody who was given nearly 80k in 1991 to buy a place , they started out in a lovely home and did an extension and all sorts must be worth an awful lot of money now - i bet they didnt like to say how they came about so much money to start with - why should they - but some people will still peddle ' we worked hard' bit years on..
Today;s young without any help are mostly screwed and its all very sad i think and not good for the economy either.

Red, I am a Geordie.

Also I had to move hundreds of miles from all family to find work and not surprisingly I have done okay. it is jsut how life has always been just as some of my ancestors moved to the NE because of the shipping industry and coal mines.

However I am not saying it has ever been easy.

The80s, prices are dropping in all the places where I and the older children who have bought live at the moment so it's not the case prices always rise and we sold our last house in the 90s recession in London at less, quite a bit less, than we paid for it. it's a big risk when you buy - all those repairs etc you pay for and then you can end up selling at a loss.

220k for a 2 bed place where I live is impossible (outskirts London) I bought first place at 21 it was a repossession so dirt cheap, 2nd place was a bit of a wreck and cheaper as in a village outside town. We saved every penny we had for deposits, no social life, holidays etc for a few years while we saved/renovated

Oxfordshire here too. Brought yr afternoon uni 110% montage. Hr commute to work. Tiny house. Been in second home for 12 years and am only just over paying mortgage as finally at 2 x income and no nursery fees (twins). Friends are all buying piles. But our aim is to pay mortgage off.

I'd agree, I'd say they're helped out/it's inherited. Saying that some people have excellent paying jobs and they saved crazily and more power to them if they did!

I lived at home for a few years after uni and saved like mad. DH did the same and then bought a flat with his brother. With my savings and his equity from their flat sale we had a 30% deposit for our current house (which 6 years later we wouldn't be able to afford to buy now, so we were also lucky with timings). We will never be able to afford to move to a bigger house, but it shouldn't be a problem.

I think a lot of first time buyers now have to rely on help from parents/inheritance, but I have lots of younger colleagues who worry they will never be able to buy a property yet still insist on living in the most expensive naicest parts of the city and going out 4-5 nights a week. However, the deposits required are so huge I guess I can't blame them for thinking "fuck it, let's just enjoy ourselves".

Maybe all those people who wouldn't contemplate living anywhere except Kent and Essex should check out the north before they knock it. We're off to Yorkshire if we ever sell this house. Beautiful scenery, friendly people, far less traffic and congestion, vibrant cities, there's no comparison in terms of quality of life. And I'm a soft Sotherner!

Savings, inheritance probably

I'm 28 and I don't know anyone my age, or around my age, who hasn't had significant family help with getting their 5-10% deposit. And I'm in Scotland, where £225k would get you a 4 bed detached new build.

Mortgage before kids.
No car.
No Sky TV.
A cold house in winter!
DIY, rather than paying a tradesman, wherever we were up to it - fitting a kitchen, tiling the floor, cutting granite counters, concreting in a new fence, etc.
Very rarely going out as a couple.
No expensive holidays. Haven't ever had a holiday not entirely / mostly paid for by points since our honeymoon in 2004.
Wherever possible, anything 'luxury' that we needed to look the part (eg. shoes, fancy clutch for work-related black tie dinners, etc.) has been bought used.

As a PP said, I don't think you'd really know where we're saving to look at us, apart from the car and lack of kids (currently pg, having finally moved to our 'family' home).

[But no family help or inheritance, and I've resented house prices being driven up this way.]

The thing is, if you can pay 1k + for childcare then that’s 1k + a month you could have been saving before, but for a lot of people it never worked like that.
I had a decent income yes but not crazy high at the time and I just saved a lot each month and got a small place in my mid twenties.
I saved relentlessly. Every time I got a pay rise. Every time I saved £10 on a monthly bill. Every time I spent less than anticipated one month. My direct debit into savings was increased. Every time.

I do know it’s not that easy for everyone but I still know a lot of people who were “unable” to save for deposits who somehow assumed childcare or bigger car payments out of the same salalry.

Saying just move, is bloody great. If you can find the job to do that too

It is exactly what we did. We are originally from Lancashire and Dh's graduate job was based in the Midlands. I left my family and my job to move with him (then just a boyfriend.)

Got married, bought a house and had a baby. Years later job opportunities for Dh (who earns far more money than I could) were better either up North or down South. We chose North and we chose Leeds due to Leeds/Manchester/Sheffield jobs. Dh is in IT.

I again left behind friends and had to consider schools with the move. But we weren't near family, they are 1 hour away so no help.

£220k here in South Leeds would get you a 4 bed detached house. Great motorway links to M62 and M1. Just over 2 hours on a train to London. My children attended an outstanding primary and now attend an outstanding secondary. We moved house again for that outstanding secondary school.

So yes you can move for jobs, and a better quality of life. It did come with sacrifices but they were worth it.

We have had no financial help from any family members, or any inheritance but bought before we had children and worked our way up.

I was lucky enough to have a friend talk me into getting my first mortgage at the age of 23. We bought a house for £49k with a 97.5% mortgage and it doubled in value, the next house also doubled in value. We're in a big house with an expensive mortgage now but that wouldn't have been doable without that first house purchase.
I do feel sorry for people trying to buy now, mortgages are so difficult to get now and you've got to have a decent deposit, not just sell your crappy old car like I did for our measly deposit at the time! It feels like the rung has been pulled up. And of course there's no incentive to let house prices drop substantially because then you'd have many in negative equity. I don't know how it'll be fixed.

Not getting divorced helps a lot... I’ve been divorced twice now and both times we split equity 50/50, the second time I really felt like I was having to start again at 40 odd.

My family all live in Essex and Kent, my children do not know anyone at all up north, they probably wouldnt want to move away from everything they know and everyone they love to live on their own in order to get a home - they should be able to afford a place closer to where they come from and close to their family

This attitude annoys me, people have always moved location for work or quality of life. In my family my Mum, all but 1 of my siblings, both my PILs and my SIL and BIL have all moved for work or quality of life. 5 of us worked abroad for at least 5 years. What makes your child so special that he has to stay where he grew up? I have no expectation that our DC shall live in this area when they grow up.

It helps if you can move up the property ladder by moving area. We started in the late 1990s in a studio flat in the home counties, moving to a two bedroom ground floor flat a couple of years later. Then, because we aren't area restricted for work we moved much further north when DCs were small, buying a large run down house without a mortgage on the money made from selling in the south. We did get a small mortgage in the end to do it up and pay deposits on mortgages on two one bedroomed flats which we rent out. Over three mortgages we still only pay about £800 a month, the majority of which is covered by the two rented properties.

Lived at home with parents longer then we both would have liked . Married , house then kids in our 30’s . That’s the way it’s done in my circle of friends and family . They are all homeowners .

Ex and I bought fairly late. Good area London. We worked hard and saved hard. My df baulked at our mortgage (double his house price) but 15 years later we divorced and there was huge equity in the property. My half I bought a btl and his half bought a business.

Thing is, our property (a flat) earned more than we did.

Feel bad for younger generation in this environment.

We had it harder than my parents and my ds has it harder than us.

Count. I was just making the point that it’s sad people have to move to find affordable places to buy that’s all! I would support my kids if they wanted to move / that’s not the issue it’s just the lack of places in their price bracket for so many young people. If family provide childcare they can’t all move away ! Not that mine have children by the way!