Home Ownership

[Gin96]

Article in the Guardian about home ownership being out of reach to most young people, it makes me very sad, poor families struggling, our generation were lucky, i’m not saying we didn’t have it hard but owning our property was within our reach, now it just seems impossible.

www.theguardian.com/money/2019/jul/31/young-britons-believe-dream-of-owning-home-is-over-survey-says

I bought a house at 21, and several friends have too. We even live in Essex. It's not the same in all cases but our friends who can't afford to buy all go on expensive holidays and spend lots of money on various treats. I understand people feeling like its unattainable, but we made so many sacrifices to purchase and so did my parents and my grandparents. Sometimes I think people use the fact house prices have increased as an excuse rather than actually working towards it.

Managed to buy 2 years ago with my husband but used help to buy and got a new build. I agree that buying on your own is really hard and you do basically have to buy a 1 bed, as there were 2 of us we could get a 3 bed. Still if house prices crashed now if be struggling to remortgage in 3 years and need to be thinking about replaying the help to buy loan too...

DH and I were in very averagely paid jobs less than £50k combined income, we worked second jobs, didn't waste money on flashy cars etc , didn't have children before buying a home and bought our house for £300k in 2016 (it needed a lot of work but was liveable), in the South east in walking distance to two stations with direct lines into London in under an hour. It's doable for a couple, on your own much harder. Young people need to be working from 16 while studying (as we both did) and in good financial habits straight away, saving a percentage of income monthly, no unnecessary debt etc and patents need to accept they can't kick their children out at 18 and expect them to buy a house. If it's doable here is definitely doable in cheaper locations, it just takes hard work and planning.

Fridge interesting maths!!!!!!!!!!!!!!!!!

@Inferiorbeing hi neighbour! 😁 My experience is similar to yours and it's not the cheapest area here.

We're of an age where we can downsize and move out of London and realise 50% of our current house price - but we have a child still at home - no way can I drag him to the arse end of nowhere seaside town for the elderly (exaggeration) and expect him to have a quality of life, social network, job etc.

It's a very fine line.

It's 5% with absolute majority of mortgage providers when you are FTB.
However, I admit that I forgot to factor in that some people need bigger deposits as @PancakesAndMapleSyrup pointed out

@Butters83 move out to a commuter town then, it's what we did. £300k bought us a three bed, three reception Edwardian semi with 100ft garden in a grammar catchment, with great primary schools and less than an hour commute to London.

www.rightmove.co.uk/property-for-sale/property-79774427.html

you could buy this with a deposit of £2900.

The problem is that most young people wouldn't want to do the work, and would think it below them to live there.

I do think it’s a combination of things. Yes house prices have risen dramatically and wages not kept up, but I absolutely agree that our standard and expectations of living has changed. Everything is on the never never. Nobody owns anything outright anymore and when you live like that it follows that you’re going to struggle to save.

It s possible but it takes hard work and dedication. I had two jobs and worked all hours to get my deposit together.

Nowadays people expect to work the bare minimum, see takeaways and meals out as the norm and have children so huge expenses before they buy etc.

@TheHandsOfNeilBuchanan woo! It's really quite expensive round here! We just had to save loads to buy last year, I get frustrated at friends saying how unfair it all is when I see them driving flash cars and going on 6k holidays, we bought a house first and now we have renovated it we are choosing the flash cars and holidays. But we spent years living on a careful budget to allow us to get here!

It's a combination of things. I'll spare you all the tale of woe but I worked like a donkey to afford my flat, and had plenty of friends -ing at me for buying an ex-council flat in SE London. No parental help here.

But, at a national level the government could do waaaaaaaaaay more. For starters, re-working Help to Buy to actually, er, help FTBers to buy. And restricting overseas property investment to property that has been property marketed locally first. And driving investment in /transport to other cities so not everyone and their dog needed to move to London.

Fridge I thought 5% was a rarity?

in terms of people moving away - not always a good idea to move from your support network when young and when not young, your oldies might need you. So a lot easier said than done.

I wouldn't want to be younger, the cost of housing is just awful.

stressy a lot of people own things outright and save for things.
My parents taught me to save for things which is what I do, my husbands parents took out loans for most things and are very materialistic.
Luckily my husband liked my parents way his sibling on the other hand has copied their parents.
I know which way my children will be raised

@RosaWaiting it's not. And it's not even just HtB for new builds who offer 5% LtV mortgages. Though lots of people don't know that.
The rate is higher for first few years before you get to better LtV, but it's worth it imho
Just some examples
www.money.co.uk/mortgages/95-mortgages.htm

Fridge but how would people then pay the huge mortgage on their average salary?

@RosaWaiting what do you mean huge mortgage? You borrow according to your salary? As pp upthread said, it's about 4.5 times your salary.

I didn't see earlier in the thread - it's not that for a single person.

an average salary means the 5% thing isn't much good anyway. I thought it was a bit odd - my sister did that years ago but property prices were nothing like what they are now!

in relation to salary - thank goodness I'm the age I am. I have no idea how ordinary people are supposed to manage housing costs.

"My son is 28, even though he earns a good wage, he can’t afford to buy a house on his own and renting is such a waste money so he might as well stay with us. It seems so unfair"

Why should we have an expectation that people should be able to buy houses on their own? I'd like to see the stats, but I bet few people ever did that. Your son could do what most people do, move into rented accomodation, shared or otherwise, meet a partner, buy together.

I'm not sure just telling someone to meet a partner is particularly helpful advice. You can't just magic one up. And ultimately, there are and always will be single people, and the difficulty many of them face in securing accommodation is an issue. It's all very well saying rent, and lots will, but we are then kicking the can down the road until they become too old to work.

These discussions just show how much people rely on their own, very small, personal samples and then extrapolate it out to 'everyone else.'
e.g. all the people 'I don't know anyone my age who can afford to buy.'

If I think about, say 100 people within 5 years of my age (31), so peak millennials aged 26-36, whom I know well enough to know their housing situation, so, friends from home, siblings, their friends, uni mates, colleagues, etc., I would say 95% of those who stayed within or moved to 20 miles of the area I grew up in (capital non London UK city) own their own homes, including my 26 y/o brother and his g/f, both of whom earn less than £20k p/y. Some even have two homes as both people in a relationship bought, moved in together, and now rent the second house out.

However when it comes to friends who live elsewhere, mainly S-E or in other countries, this goes down to, I'd say roughly,30-40%. Which is why articles like that are so damaging and mis-representative (and, unsurprisingly, London and South East focused) because it suggests that nobody under 40 can afford to buy, whereas actually lots can if they were prepared to move or make significant lifestyle choices. Obviously there are lots of completely valid reasons why people might not be able to/want to do this, but it's not an impossible dream, it's something that is achievable if it's enough of a priority to make (sometimes significant) changes.

In that guardian article 50% said buying a home was one of their main ambitions in life, yet 42% had saved absolutely nothing towards it! I mean, come on if it's something you want that much, most people would start saving something.

Yes it was much easier to buy 20/30 years ago but there is assistance available for first time buyers now, e.g. the fact that a H2B ISA means the govt will give you 25% on top of what you save is a huge incentive, and a bonus you don't get for any other type of purchase. Nothing like that, e.g. completely free money, was available when my parents were buying their first home in the 80s, and interest rates are incredibly low now compared to then. It's swings and roundabouts.

@RosaWaiting yeah. Average salary doesn't buy much in some parts. But in others it can buy a nice 3 bed easily (I was slightly below average when I bout 3 years ago).
Differences are astounding. Was interesting to see it in www.mumsnet.com/Talk/am_i_being_unreasonable/3645173-The-cheapest-and-the-most-expensive-property-within-5-miles
thread

I’m 43, my sister is 47. It was feasible for us to buy alone in outer London burbs on average salaries, but interestingly the time gap between us meant she was horrified by the amount of my mortgage.

I agree that people today want their house to be like something from a glossy magazine instantly. I knew a young colleague who recently bought a house with his wife. They had a big list of jobs they wanted done within the first 6 months. Like new kitchen and bathroom etc. What was there already was fine, he showed me the photos. It just wasn't "impressive" enough for their tastes. No one wants to wait for anything any more, that's why there is so much debt.

I'm still working on the house I moved into 13 years ago!