To think most property owners don’t understand how hard it now is to buy a house

[Boredfromboredshire]

DP and me earn 40k between us and our rent is 1200 a month for a 3 bed house. We don’t have rich relatives, we are in our early 40’s and circumstances (ill health) meant that we didn’t buy a house before. We can’t save a deposit & houses are expensive by us. We have stable jobs & our kids are happy so moving in the current uncertain time’s isn’t an option. Life has happened to us & some of it has been out it control.

Cue well meaning friend (who bought their house for peanuts) asking me why we couldn’t afford a house when we could get a house in a cheaper area for ‘only’ 400k. I’m so fed up of it. We really want a home of our own & we would move but in the current recession, it’s not a good idea to give up a job. And we can’t afford to save. My friend (whose deposit was 12k can’t understand it and looks on pityingly while telling me the house they bought for 120k is now worth 700k.

For many of us, the housing market is closed for ever. I’m so tired of the pity and the complete cluelessness- I quite often feel utter despair about it. It makes me feel such a failure for no real fault of our own. Some people were lucky because they happened to buy at a particular month in time & then some of us couldn’t & it’s over.

I don’t think people who own really understand what it’s like. Low interest rates, cheap mortgages, everything weighted in favour of owners while renters are treated like the Victorian poor.

Aibu to be sick of it. We are a normal family in normal jobs.

My point is, OP can't afford to buy because of choices they made, or bad luck, but that doesn't mean to say they can't turn it around if they wanted to

this is not true in the slightest. You said their earning are low but not everyone can get a job that pays 50k+ each. You need to take off your rose tinted glasses.
I have a degree, can't find any work in it though.
I'm also senior in what I do for my career but there is no chance I'd be getting more than 30k at best wherever I go to do it!

would you like to elaborate on that?

On an individual level it may seem great when a bank is willing to give you lots of money, at a low rate, to buy that house you want. But what it actually does it push prices up.

You may think prices go up because of supply and demand of, well, houses, and that’s certainly part of it: but what got us to the point where people on decent salaries, without an inheritance, are finding it impossible to buy a house they can live a good life in (rather than barely squeeze into for a couple of years and hope to sell at a profit, probably in a place where they can’t find a job), is the supply of money available to borrow. Don’t believe me? Maybe you’ll believe the Bank of England, itself the chief culprit: positivemoney.org/2019/09/bank-of-england-confirms-positive-money-analysis-of-house-prices/

The system is set up for young first time buyers stepping onto a low rung of the ladder, then spending their productive working lives climbing it. If it isn’t obvious to you that this system and “the ladder” is broken, we’re probably never going to agree on anything. It’s even worse if you didn’t order your life just so, and run into a situation where, as a previous poster put it,

we thought we had time on our side, since house prices back before about 1998 ish were only 3 times normal wages. You could even find houses at just double wages in cheap areas. Then they doubled, we all thought they'd fall again and waited: then they doubled again, tripled, and finally quadrupled and that was that, most people were locked out unless they had parents to help. It changed so quickly.

A lot of people “don’t get it” because they got extraordinarily lucky with timing and figure the ladder worked for them, of course it’ll work for you, if you just “make sacrifices” (this is where avocados usually come into the conversation). It may be the only sacrifice you can make at that point is to restrain yourself from slapping them.

I get that if you’ve managed to buy a house, the thought of it suddenly losing value, even if that’s just theoretical at the moment, can be scary, and it will make you angry when people suggest prices should come down (“crash” is the preferred terminology for maximum psychological effect). They’re trying to take money from your pocket!

Look at it from their point of view. (Well, from mine.) As a saver suffering many years now of extraordinarily low interest rates, the fact that rates have been kept low to prop up the market you’ve bought into means money has been taken from my pocket.

Also, you’ve purchased what in all likelihood is a very overpriced house, helping to set a price for whatever street you live on, your transaction yet another little data point in the great housing spreadsheet of the nation. Perhaps you’ve used “help to buy” or shared ownership or some other crackpot scheme cooked up to keep the whole wheeze going (another one of those things that may or may not be great for you, but is awful on a larger scale). I don’t know your circumstances. Maybe you’ve even worked nose to the grindstone at three jobs and have never caught a whiff of avocado other than from the bathroom suite at your nana’s. It doesn’t matter. What matters is that a) you’ve just done your bit to keep prices high, and b) many, many of you now figure you’re a protected species: that your possible negative equity is a worse fate than not being able to buy in the first place.

Sorry, but chances are you’ve become part of the problem. Don’t believe me? Believe an articulate homeowner: www.telegraph.co.uk/news/2016/06/07/i-was-an-angry-young-renter-who-railed-against-the-mortgage-indu/

We’re now at a point where otherwise nice people may be actively rooting for a Covid crash or a Brexit crash or any crash really, not because they want to inflict pain on you personally, but because it looks like the only way for them to have a shot at owning a house.

This is where homeowners usually say but the economy will be trashed!! Banks won’t lend!! Be careful what you wish for!!! I would suggest that they’re more concerned about their money making machine breaking down than they are about the predicament of non-homeowners.

As far as I’m concerned, the status quo is a worse option. Housing sucks up far too much money, which could be better spent elsewhere in the economy. Uncounted years of life are spent servicing debt that needn’t be. “Affordability” is king, pay less for longer so really pay a lot more in the end because who cares? You’re planning to be long gone…

Unless something big happens to shake things up, the future looks to be even more debt servitude, and at best, owning a small slice of a house because we mustn’t ever let them come down in price. Anyway, the economy is already fucked. If it isn’t for you personally, good for you; but it is for a lot of people, simply because it isn’t working very well to provide decent options for shelter and stability.

Tl;dr: if you don’t see a BIG problem, it suits you to not be looking very hard.

I do have a little empathy with the “ don’t spend money on shite n save brigade “

I think this extends to buying stuff for the home, too.

I left home in 1975 and bought my first house in 1982. I didn't have a single item of new furniture until I bought a new bed in 1990, or new carpets, cooker or fridge until I moved into this house in 1993.

My carpets were being ripped up from a high-end department store where a friend was shopfitting and cost me £5 and my washing machine came out of a skip (and worked - for another 8 years or more). Everything else was 2nd hand from small ads or junk shops.

Nowadays, people seem to buy everything new when they first set up home, and then replace it frequently. One of my SILs is on her 3rd lot of new sofas in less than 9 years. It's taken me 30 years to get to my 3rd pair of new sofas!

OP has conveniently said very little about her circumstances so it's impossible to know whether her and her OH have been hit with bad luck that made it impossible to become a home owner or whether they made choices under circumstances that was always going to make it hard for them.

OP mentions her Oh illness, bit we don't know how debilitating it was, how long it went on for, how many children they chose to have during that time, whether OP worked at all etc... all these will determine whether they indeed never had a chance.

Saying that £40k for two income in Oxford is very low. Either he earns £30k and OP is only working PT or they are both on very low income.

I have often heard how lucky I am to be a home owner and that I got it easy because I bought at the right time. However, I made the choice to always worked FT, did a master's whilst working FT and look after two kids on my own. I did what the cast majority of women under the same circumstances would have refused to do and taken an easier life in the present time.

A colleague of mine in her early 30s often moan she and her partner have it so much harder than previous generation. This is true but... she chose to have two children, not work until the youngest started school and came back on only 3 days.

They have two cars even though they could definitely make it work with one, but it would mean getting up earlier and more planning.

She also defends that they don't have luxuries but still can't save, but following her on Facebook and they are regular comments on evenings out, drinking parties, shopping trips etc... She will say there's nothing wrong with it because they work hard. Indeed but when I was saving to buy a house, I made the choice to have none of this, because getting on the ladder was more of a priority.

So really, without knowing circumstances, it's impossible to comment.

@spilltheteaa again choices. You chose a career that doesn't pay particularly well. I'm not judging, that's just a fact.

And I entirely agree that a degree in no way helps most people earn more money. I don't have one and neither to most of my friends on good incomes.

Anyone CAN earn 50k if they wanted to, but it would mean different life choices, doing a career you don't necessarily love, not having children younger who definitely do limit your earning capability.

I come from a very working class family, with no inheritance, university education or help in life that way but have still managed to own my own home. It took sacrifice, (to buy aged 18 when all my friends were partying) and my career has developed because I continue to develop my skills and stay ahead in the industry.

Choices.

You said their earning are low but not everyone can get a job that pays 50k+ each. You need to take off your rose tinted glasses.

Of course they can't, but that does mean if you choose to live in an expensive area on a low income then you're making choices that mean you can't buy a home there.

DH and I were on about 35k between us when we bought our house with a 6k deposit five years ago. We bought in a cheap area and sacrificed plenty to get there. Like a PP said we also have no new furniture except a sofa that my mum bought us when we married! Everything else is second hand or hand-me-downs.

Lots of people don't want to live in cheap houses with cheap furniture and no carpets though - they want to buy a brand new house with three bedrooms and a garden right away. The housing market rarely works like that!

It is definitely not easy to get on the property ladder. It is undeniably much more difficult now than ten years ago, never mind twenty or thirty years ago. There are easily available comparisons if you Google to see what salaries and house prices have done over the years. I understand how annoying it is when people deny that. I have family members who refuse to acknowledge the difference.

But... That doesn't justify thinking most home owners are naive or had it easy. Or that there isn't still an element of choice at play. Our first mortgage was on a 1 bed flat in a really bad area of a city. Same for pretty much all our friends. We saved for two years for a deposit on below average incomes. It doesn't make me smug to say that. I don't recall it being particularly miserable. We were excited to save. Friends were in similar position.

It doesn't mean I think people who are renting made mistakes. Decisions are complex. Eg, we had children older than is ideal - with consequences. But those were the decisions we made.

I don't think it' ever been very easy for first time buyers, inflation makes it look like people used to buy houses super cheaply (yes probably cheaper then than now, but not sure the difference is as vast as it looked like).

In retrospect two things have worked massively in my favour. 1) living in a cheap area of the country and 2) buying well before kids.

But buying meant saving money, and I mean really really saving money. So accepting a really frugal lifestyle in comparison to my peers. And I think that the older generations also accepted very frugal lifestyles in order to be able to buy.

For my first flat I bought a tiny cheap studio flat while saving extremely aggressively from a PhD stipend. As a result I had mortgage payments of only £250 a month.

Because of cheap mortgage payments I was able to continue saving equally aggressively from my first job towards the next deposit. I was paid around £20k-£30k over the 4 year period when I saved nearly every extra penny. For 6 years DH and I lived in a studio flat when our peers were living in 2/3 bedroom flats or starter homes. I paid the mortgage off in 5 years and now own the flat outright and rent it out. And we were so so happy in that tiny flat, it was so special to us. We made it our lovely little nest.

Saving so much from my first job (massively helped by paying a cheap mortgage on a tiny flat as opposed to expensive rent on a bigger property) meant I was able to then buy a 3 bedroom house together with DH when he finally graduated.

Deposit for the first flat (circa £20k) and deposit for the next house (circa £50k) were entirely saved from my lowish income (DH went back to do a second uni degree as a mature student when all of this was happening).

Buy the time we were ready to buy our house, DH was also working and we could afford a mortgage for a larger property as we finally had two incomes.

We really wouldn't be where we are now if we hadn't made the best of living in a tiny studio and if we hadn't saved, saved, saved. If he we had immediately wanted a lifestyle we felt we deserved, we could now be stuck on paying unaffordable rents and not being able to gather a deposit. (Because we now have childcare costs and need for bigger space).

The only thing within your control is to move to a cheaper area. If you don't want to do that you need to name peace with how things are.

I have often heard how lucky I am to be a home owner and that I got it easy because I bought at the right time

Yeah, I too object to the word "lucky" being used in this context. I own my house and that was partly due to losing both my parents at a young age. So yes, whilst you might consider me "lucky" for having the money to buy a house, I do not consider it "lucky" that my children dont have their grandparents (they never got to meet my beloved mum). I never got to have my mum at my wedding, or help me with childcare, I cant ring her up just to get some reassurance or hear I love you ever again.
Thats not "lucky" in my book. Life is a balance of ups and downs so whilst OP might feel she is lacking in one area- housing, I'm sure there are other areas of her life where others would consider her "lucky".

I do feel we need to be mindful of how we use the term "lucky" because its very easy to look in from the outside and proclaim people as lucky when really, you have absolutely no idea whatsoever about their inner struggles or what they've been through to get what you consider to be "lucky".

I only got on housing ladder a few years ago, we managed to save before we had a baby (It's really hard to save anything after having one becuase nursery costs and reduced hours so earning less!).we did the help to buy scheme and houses in this area are relatively cheap (new build 3 bed under 250k). I think buying in an expensive area is impossible for first time buyers :(

I’ve also noticed that people who like to go on about “choices” are usually keen to try to fit the populace into a screwed up housing situation, rather than tailor housing to facilitate greater life choices.

@Boredfromboredshire your situation is recognised as difficult, almost impossible by economic studies. The FACTS, whether people on here acknowledge it is that asset owners have benefited massively from events such as 2008. I’m not sure what the answer is, but the government are aware it’s a massive problem, but CV will not have helped I’m afraid.
worthless, but I do genuinely feel for you. This situation has been done to you, not greater by you.

*created

It’s not necessary to each earn 50k or to have a deposit of tens of thousands in many areas of the country still.

Many lowish earners, without family gifts and support, live in cheap areas and manage to save a few thousand whilst living in cheap rental in cheap area and then buy an affordable property.

It has undoubtably become harder in the more expensive areas, but buying property somewhere is still very possible. The reality is that people need to be more flexible about it. And it doesn’t help to say they shouldn’t have to move or shouldn’t have to scrimp and save or that quality housing wherever you live is a right and the system we live in is wrong and needs to change. You can say these things as loudly as you like and find you’re still in renter in 15 years time, feeling more bitter as you approach retirement. Or you can accept the realities and that actually there are some choices that could lead to ownership and give you a more secure future and move towards them.

In the end, some of the people in Ops situation will have more security and have bought somewhere cheaper in 10 years. They will have been pragmatic. Others will have kept moaning that it’s unfair and no-one understands and identified obstacles to moving that they say can’t be overcome. They will still be in rented and the time for getting a long mortgage will have gone. They will think their counterparts who moved must have had help and don’t understand but the reality is that they were in exactly the same circumstances and it was very hard for them, but they made difficult choices that gave them security further down the line

Affordable housing is available in this country but if you won’t move to those areas you may have to accept you’ll never buy. ...there is a choice.

Nobody seems to want to start the property ladder at the bottom, a small apartment/terrace house, in a less desirable area, stay there for a few years and build some equity, then move up "the property ladder"

That assumes prices only ever go up. I have friends who bought city centre Manchester flats in 2006. On 100% mortgages with cash back, so 105% mortgages. These were new build and they all lost 15% plus on them in the next two years. Given they had none or little equity (if they had made repayments and not gone interest only), they either had to sell at a loss or stay put for 8-10 years until prices went back up to what they had paid. Those years were when they were having children and a city centre flat wasn’t ideal.

House prices have been going up since the 1980s overall but there have also been two major slumps that lasted for years, during that time. People that bought at the top of a peak were hit hard.

There isn't a home owner on this thread who said that it was easy, if anything they've been telling you that they had to make sacrifices, wait with having children and go live god-knows-where to be able to buy a house.

Oh, the 100% mortgages with cash back on top were the 2000s version of help to buy.

I had a quick thinking back of when my home owner friends bought their house and indeed, all but a couple bought their first home, in most cases a flat, before they had children. I think this is massive factor.

Agree with pp that it has always been thus. The difference seems to be that priorities have changed. All my generation bought when we were 21/22, first jobs. We weren't paid much, but clubbed together as couples or friends. Out first flat was tiny, 98% mortgage, borrowed deposit from Dad, and our earnings were 10% of the value of the property. So broadly similar to now. Our mortgage rate was 10% however, which in Today's terms sounds scary. We managed by not doing anything else and having all hand me down furniture etc.

So we were early to the party, but please remember, we didn't make money on every house. In fact I two we were in negative equity, so had to save to move again, but I always think once you on the ladder you always have the advantage.

Nowadays, people seem to buy everything new when they first set up home, and then replace it frequently. One of my SILs is on her 3rd lot of new sofas in less than 9 years. It's taken me 30 years to get to my 3rd pair of new sofas!

Exactly. When we moved here we had concrete floors downstairs for three years as we couldn't afford new carpets! Our first sofa was third hand from DH's mate and so threadbare - but again, we couldn't afford a new one. We just covered it with a duvet to make it more comfortable and appealing to sit on!

Neither my nephew nor his girlfriend earn masses, but they bought a flat cheaply as it was previously owned by an old person and needed doing up - which they did on average earnings for junior shop worker (zero hours) and first job electrician after being an apprentice. They made enough money and saved enough to move on 18 months later to a nice 3 bed semi which also needs doing up. They live less than 40 miles from central London .
They're never the sort to eat out masses, don't drink a lot or holiday overseas, or spend on flash cars or coffees out - they take flasks and sandwiches to work. They've saved for a small wedding (postponed due to CV), have chosen not to have kids till they're at least 30, and a good day out is a walk in the country. They're quite frugal compared to many of their friends - but are still the only ones with their own home.
Depends where priorities are IMHO.

Isn’t the most straightforward way to get on the property ladder in Oxford to move to Bicester and commute?
OP, you have a low joint income and want to live in one of the most expensive parts of the country. YABU in thinking the bank should take that kind of risk. I’d live to live in Mayfair but my salary isn’t 7 digits so I don’t, and take the train there instead

Lots of smugness on here. “Work harder” do people not get that we need those low-paid keyworker roles, or is the current awareness of them merely manipulation to persuade the poorest to risk their lives in a pandemic? I mean the real low paid roles, not the oft-quoted relatively high-pay teachers and nurses btw.

“Start in a smaller house, poorer areas aren’t beneath you”. Even those starter homes are bloody expensive. If anything it’s especially those starter homes, they were the first ones the buy-to-letters bought up. And those poorer areas are poor for a reason, I grew up in one and was quite regularly attacked by the local gangs of kids and drug dealer’s family and friends. I’m not living like that again while I’m working if I can help it and I wonder how often the people who recommend this as an option have even walked through such estates of an evening.

“Don’t have kids until you’ve got a house”. Have you not seen the age of first time buyers creep up? It’s late 30s now. Human fertility has not similarly crept up. If you ever want kids it often has to be before house buying now.

Move to a cheaper region. I did that and it isn’t so simple. Jobs are fewer, especially secure with good pay. And what if that is the region you are brought up in and there is not another cheaper region to move to? We weren’t all brought up in nice southern middle class mansions with options.

It’s all proving the op’s premise. Older and richer people do not know or are absolutely refusing to admit that it’s harder now for the average working person. It’s almost as if they have vested interests in that refusal.

@somenerve I think you have misunderstood my comment.

House prices go down, the lending goes down it would be the same trying to get on the ladder as now.

We owned our house from the age of 23 and had a child when I was very young. Sacrifices were made and we pushed for better jobs. There are many housing schemes too if people wanted to get on the ladder.

It real boils my piss for others to wish for something to happen that may break someone else and this goes for anything! It's selfish and cruel.

The fact is, if you really want to buy a house you can you just need to put your mind to it, instead of expecting it to just 'fall into your lap.'

Lastly don't get at people who are trying to offer advice.