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

It does depend on where you live, 1 bed flats start at £80k here so within reach of young couples. The other factor is that youngsters today often have home owning grandparents and great grandparents, many may find money for a deposit is given to them (doesn't help non home owning families but it does help many)

You could buy a run down 2/3 bed in our area for around 90- 120k. OK, you'd probably need an other 50k+ to do it up and the area isn't great at the moment. But the London commuter belt is slowly moving closer with just over an hour on the train. There are "bargins" & opportunities out there.
I think the 2 major issues are 1.) Income is spend on things like mobile phone contracts and lease cars which take a chunk out of a potential mortgage budget. 2) many young people are not prepared to get their hands dirty or want something to move straight in.

Tbh to my generation, we have chatted with mum about differences in basic outgoings when she was my age compare to now.
There was no broadband and mobiles like this. But we do need both today, even if it's cheap ones, still outgoing she didn't have. They paid cheap landline.
Computers. People didn't really need to have them at home, but today you need something because so many things are done via email and online including job searches.
Clothes are not made like they used to be😁 She still has dresses older than me!
Lifestyle changes over the generation. Food is dearer now because we are looking more for convenience rather than spending hours cooking like she used to do. That one she really gets and is actually using convenient products like sauces jars too now.
Public transport used to be better there. Now the changes mean lots of people need car.

Many expenses we have nowadays, but they didn't are quite non negotiable. It doesn't sound like big things, but it snowballs together.

I bought in 2008, age 21 with a 100% mortgage. It was a 2 bed flat on the main road that no one else wanted and I still live there now. Have done it up and added an extra bedroom. I couldn't buy the same flat if I was starting out today. It's 'worth' £200k, which is 8 times my wage and the deposit alone would be £20k. I wonder how my children will ever be able to do it.

We had to buy in a fairly rough area in our city to be able to afford to buy. If we’d waited, we would have been at least 2 years older and paid another £20k in rent. It’s extortionate.

I’m 26 and bought a 2 bed terrace with DP for a £22K deposit a couple of years ago. It does make me shudder thinking how large the mortgage is compared to what our parents got for their money. We are saving for a deposit on a bigger house and are hoping to use any equity in our house to fix it up.

It is difficult though and I have to say I feel a lot of pressure from my parents and other people to live some kind of flash life. Not necessarily by way of stuff, but definitely holidays which are bloody expensive. There’s this view among my parents and their peers that having travelled all over makes you morally superior and mine say things like ‘oh there’s plenty of time to settle down, see the world while you are young!’ They are almost dismissive of people that spend their money on houses rather than ‘living life’ so I don’t think it’s entirely millennials own doing. That might just be my experience though.

As for us, I’ve decided the house is important and that’s our goal but each to their own and we can’t have it all!

To get a bargain and make by buying a doer upper is impossible for most today as they don’t have the skills to do the work needed. Redoing a bathroom and tiling, fitting a kitchen, plastering etc are all seen now as requiring trades people at the cost of £££££ as they have never been taught what I would see as basic diy.

@Dontsweatthelittlestuff i still get chest pains remembering how much my electrician charged. But he was worth it. I should have learn a trade!😂

My parents used to teach us things around house and I am sometimes surprised how little many people my age can do. It's shame parents didn't teach them. Could have saved them ££

Good trades people earn very well. I have a relative who is a carpenter in the building trade so not the type that makes bookcases and hangs doors. He is booked up months in advance usually on large projects and makes seriously good money.
Plumbers, electrians and builders all earn well.

The comments about millennials not wanting fixer-uppers isn't my experience at all - I don't know anyone who hasn't had to do a significant amount of work to their houses.

I work for charities so usually low wage and vast majority of my jobs have been fixed term contracts, so banks wouldn't look at me when we needed a mortgage.

We'd both been saving for years for a deposit but could only afford a small 2 bed fixer-upper 4 years ago which we're still fixing up - just had our first DC and we know we'll have to move in the next few years if we have two DC due to the size of the place, as well as the fact the primaries around here are v bad - we knew this when we bought but had no option to buy somewhere we would be able to stay in for the longer term, which was within commuting distance of the city we work in/other nearby cities ( not london/SE).

Very frustrating and a waste of time/money but at least we're on the housing ladder. We'll have spent a lot of time & money doing it up and as it's taking us a while we won't really get much "benefit" from it being newly-done by the time we need to leave.

Not sure what we'll do next as I'll be on mat leave and/or still not able to be considered mortgage-wise when we need to move, so we might need to move somewhere more in the sticks to be able to get a big enough house & be in a catchment of a good school - but then DH's job/commute will be an issue. Can't win really.

And DH's grandfather, living alone in a 5 bed on the outskirts of London, berated us for buying a two bed, saying it's not big enough. Helpful. More helpful would have been a few quid to help with a deposit, or keeping his trap shut!

Doer Uppers are generally snapped up by property developers in my area.

Also, not everyone can "do up" due to disabilities etc. Both my DC have dyspraxia and couldn't even paint emulsion on a wall without ruining the entire room

Skilled trades people, quite rightly come at a high price...

Your first paragraph and your second don't seem to match each other very well yivamoon. If the 100k properties near you would require another 50k of work, that money is not going to be freed up by a cheaper phone contract and the work is going to involve much more than merely getting hands dirty. The reality is that a mortgage of perhaps 150k is going to be a lot more accessible in many cases than a mortgage of 100k plus cash and/or skills to the value of 50k.

George Clarkes' Council House Scandal Ch 4 last night worth a watch contrasting attitudes in UK to renting as opposed to attitudes in Vienna where majority live in government housing.

Social housing in Vienna has been widespread since the 1920s when the post-war municipality, led by the Social Democrats, began building high-density estates all over the city ― typically six- to eight-story apartment blocks with communal green spaces. Today, anyone earning up to $53,225 a year after taxes is eligible to apply for a subsidized apartment in Vienna in a country where the median gross annual income is about $31,500. According to the municipality, 62 percent of Vienna’s citizens currently live in social housing. Here, rents are regulated and tenants’ rights are strongly protected

Lots of delusional nonsense on this thread:

Some times I think we were complete mugs buying a house. We had reduced disposable imcome, and eventually it will be taken to pay for care homes.

On the other hand, had we rented, we could have had extortionate holidays, big cars, and safe in the knowledge that the same level of care in the same care home will be paid for by the state

That money you’ve been paying on your mortgage? It’s mostly still your money, apart from the interest. You can downsize whenever you want and get some of that money back, most likely a lot more money than you paid in, too. And you definitely won’t be ending up in the same care home if you’re paying for your own care vs the state funding it!

It also says that nowadays the starter property is a 3 bed due to people buying later. Obviously 3 beds are expensive compare to 1 bed flat which should be the starter.
Come off it. Our 3 bed family home was £82k in 1990. You can’t get a studio flat for under £120k here now. The first house my mum bought, in the 80s, was £16k for a tiny 3 bed.

Plus rents are a much higher proportion of wages, so how are people expected to save?

And even if you can save a deposit, you can’t borrow enough to buy - that’s the issue most often faced by people we know.

We only own a house because my mum passed away. We could only borrow 50% of the value of our tiny two bed terraces

My DD has just bought a house. She's 24, earns £25k. Her and her partner were renting, paying £750 a month. We gave her £5k towards her deposit and she saved the rest by basically not spending anything unnecessarily. Her house is in a dodgy area but she doesn't mind. Her mortgage is half that of what she was paying in rent, so is overpayi g the mortgage so that when she gets a substantial pay rise (once she gets her next lot of qualifications) she will move into a house in a nicer area and have more equity for a bigger deposit. She didn't move back home after Uni, didn't buy a car until she could afford it, didn't spend money on take away coffees or other stuff. It can be done, particularly if you live out of London and are prepared to live within your means.

Some times I think we were complete mugs buying a house. We had reduced disposable imcome, and eventually it will be taken to pay for care homes.
Well how would you have paid rent? Most rent these days is more than a mortgage on the same property. Renting often means less disposable income with nothing to show for it after paying it for twenty five years.

On the other hand, had we rented, we could have had extortionate holidays, big cars, and safe in the knowledge that the same level of care in the same care home will be paid for by the state
🤣🤣🤣 oh how I laugh! That's utter nonsense. Unless you rent in a hovel. The state do indeed pay towards your care home costs, but having seen at first hand what that gets you, it's not something I'd rather have. My MIL has just gone into one, paid for by the state. It's bloody awful! We are topping up the payments to the tune of £100 a week. For that she gets a shitty little bedroom, no ensuite, gets to sit in a 'lounge' surrounded by other residents with no conversation, can't move because there are not enough staff to help her, wets the bed at night because staff can't get to her in time. It's my worst nightmare.

We are now mortgage free. I'm happy for my home to be used to pay for my care should I need it in old age. I've got many years ahead of me with no rent to pay in a house I love with no fear of eviction.

Well i am skint and i drive a basic car, have lots of hand me down furniture and shop charity shops but cannot afford to save the necessary 30,000.
I couldnt earn enough as a teacher dye to zero hour contracts. I'd love a fixer upper but the deposit would still be huge.

Sometimes i do think young people wonder if it is worth s rimping for 10 years living at home to save for a deposit when they could spend their money on living life and having a good time. By good time i dont mean long haul flights etc just a night out here and there and good food. Tbh i cannot blame them.
My friend has memories of eating beans for years as parents were saving...is life too short for this?

It's awful and I have two sons who may not ever be able to own a place.

@SinkGirl what do you mean come off it? The article says it's 3 bed now, which implies it wasn't before?
Sard said the average age of a first-time buyer has increased from 25 to 33 years old in the last two decades, and 40% have already started a family. As a result, Santander found that the most sought-after first-time buyer property is now a three-bedroom house.

Also as fondly as many are remembering the prices from 80s and 90s. Weren't there few recessions that time with unemployment rising and managed decline of certain areas? That would affect prices. Same like if people fondly remembered the latest crash prices😮
I might be wrong so I will happily be corrected and learn.

The article says it's 3 bed now, which implies it wasn't before?
The point is that in many areas, even a 1 bed is out of the reach of people in their 30s, who by then may well be married with kids.

People bought 1 beds in their early 20s in the past because they could afford to do so. It’s not possible now for most. And as for people not saving enough, the cost of rent makes that impossible for many, plus many people I know who got on the ladder 15-20 years ago or so had 100% mortgages (or more!) which are no longer available.

Also as fondly as many are remembering the prices from 80s and 90s.

I’m not fondly remembering them. I’m accurately remembering them. In 1990 my mum and step dads joint income was £30k and their lovely large 3 bed family home in a good area cost just over £80k

That same house is now £500k, and couples here don’t earn anything like £150k

The point is that in many areas, even a 1 bed is out of the reach of people in their 30s, who by then may well be married with kids.
Absolutely not disputing that about different areas. If anything I always said that talking about housing shouldn't be general, but areas should be mentioned due to massive differences in costs.

had 100% mortgages (or more!) which are no longer available.
For a reason

The problem is also wages not just house prices.

The abolishment of the default retirement age has resulted in less jobs/promotion opportunities for younger people and the introduction of the apprenticeship levy has pushed starting wages down.

Where I live a 3 bed semi costs approximately £300k which means, with a 10% deposit (£30k + 5k for costs) and the owners would need a combined income of £65k.

Out of my group of friends who are a similar age only 20% of us own our own homes at 30. I will be mortgage free by the time I'm 40 - we've deliberately overpaid to be able to help our kids get on the property ladder as can't see how they'd do it without (we had help- just passing it on!)

@SinkGirl you left out the rest of the sentence. I don't question whether people remember the prices accurately. I questioned whether the prices were possibly low due to number of recessions and managed decline of areas.