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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

To think young/those in low paid jobs

46 replies

MiaMarshmallows · 13/03/2021 16:00

Will now find it easier to buy their own properties despite the coronavirus situation? (Because of Rishi's plans)

OP posts:

luxxlisbon · 13/03/2021 17:20

What specifically do you think makes that more likely?

KitesFlyingInTheWind · 13/03/2021 17:27

No.
Even with a 95% mortgage, you're still only going to be able to borrow x amount of what you earn. You'll still need a big deposit.

LemonSherbetFancies · 13/03/2021 17:58

And yet people still get judged for living at home as an adult.

MrsTulipTattsyrup · 13/03/2021 18:03

@trappedsincesundaymorn

Well given that mortgages are usually calculated by 4.5 times your annual wage the most I will be able to get is £79,000. Living in a commuter village to a nearby city, you want to to guess how many properties are available at that price or lower? I'll give you a clue, it's less than 1.

If I was in your position, though, buying would not be the best option for me - I’d be worried about squeezing out the mortgage payments on a low fixed rate, but then not being able to afford to remortgage when it ended and rates went up (which is inevitable, I think, as inflation rises). Even if you fixed for say ten years, then you’ve got the issue of affording all the unexpected expenses which come with ownership (new roof? Boiler and heating system parts all going? New windows?) and would be happy to put all those obligations on a landlord instead.

FoxyTheFox · 13/03/2021 18:10

I think a part of the problem for a lot of people is the credit history and gatekeeping process. Obviously banks need to protect their interests but if someone has been consistently paying £800 a month rent for ten years (for example) without ever missing a payment, why would a bank turn them down for a £700 a month mortgage (again, an example) when it's already proven by their rental history that they can afford it and can be relied on to pay it?

tttigress · 13/03/2021 18:23

Surely his plans will push prices up?

The goal should be to bring house prices down.

Iwantacookie · 13/03/2021 18:25

At £8ish an hour and average 2 bed here is £175,000 here could you elaborate please?

Okbussitout · 13/03/2021 19:03

@LemonSherbetFancies

And yet people still get judged for living at home as an adult.

I find a lot of this judgement oomes from people privileged enough to have had help with buying or renting or going to uni. I also think the is an enormous generational devide. My parents generation found it way easier to buy. So they tend to then think that living at home is lazy and they pass these views on to their children.

Sparklesocks · 13/03/2021 19:11

Well depends if you’re able to save a deposit and how lenders view you, your credit rating etc. Not always easy, especially if you’re paying a lot for rent etc.

I think also it depends where you are in the country.
If you live in a busy/sought after area then competition is fierce, so even if you manage to get a 5% deposit you’ll be putting in offers alongside potential buyers with larger deposits who can offer above asking. There’s just not enough decent properties to go around in some places, not to mention prices will be pushed up by the increase in potential buyers.

LemonSherbetFancies · 13/03/2021 19:40

I do find it strange how people judge those for living at home. Even on a decent wage a lot of single people will struggle. I would hate to be trying to make it on my own if I were young in this day and age. Feel very fortunate that I was able to move out young because it was do-able back in my time.
I agree that most of those who judge are from a different generation, able to move out because they have a high earner as a parent or have had lots of parental support.

SofiaMichelle · 14/03/2021 09:17

@tttigress

Surely his plans will push prices up?

The goal should be to bring house prices down.

Exactly this.

As I said in my post, too. The 'easier' it is to buy a house the higher the prices go.

Even if the government gave person earning £30k or less a completely free £10k deposit with no ties AND paid the first £250 per month of their mortgage, there would be no effect at all other than house prices going even higher.

An effectively finite number of houses are available and more people want a house than there are houses. If everyone has an extra £10k available the house goes up by £10k. The end.

Original poster

MiaMarshmallows · 14/03/2021 10:02

I just don't get why I keep reading that it will help young people and those on a low wage, more opportunities to get on the property ladder. Guess I misunderstood.

OP posts:

BlueSussex · 14/03/2021 10:07

How do you mean? Here, a one bed flat in a safe but not central area, kitchen part of the lounge, costs £350k. Average income for young people would be £25k.

How would a couple afford that without a huge deposit, never mind a single person?

XH and I bought a two bed Victorian terrace in 1997 in the same area whilst both in minimum wage jobs and a £2k deposit. Totally impossible now.

StephenBelafonte · 14/03/2021 10:08

The goal should be to bring house prices down.

The only thing keeping the tories in power is high property prices.

Felifox · 14/03/2021 10:30

Many young people may be able to buy as older relatives die and leave them money. If I still have a house when I die the proceeds will go into trust funds for 4 young relatives

SpilltheTea · 14/03/2021 10:35

Nope. The 95% mortgage is useless if you have a small income. House prices keep rising and wages stay the same. Young people are screwed.

Ailurusfulgens · 14/03/2021 10:57

House prices really are too high. Our first 3 bed terraced house cost £85k you can buy this house today for £165k. I'm a teacher and bought that house on my wage alone in my first year of teaching. No chance you could buy that today as a newly qualified teacher without a big deposit.

I expect to have to help my kids buy houses.

yoyo1234 · 14/03/2021 11:40

As PP said "Even if the government gave person earning £30k or less a completely free £10k deposit with no ties AND paid the first £250 per month of their mortgage, there would be no effect at all other than house prices going even higher.

An effectively finite number of houses are available and more people want a house than there are houses. If everyone has an extra £10k available the house goes up by £10k. The end."
Property here is one of the most undertaxed assets and they thought let's remove about the only tax there is on it ( excluding council tax and CGT if it is a second property- even then there are lots of allowances). Stamp duty holiday just inflated prices by more than the cost of stamp duty in lots of cases. The 5% deposit likely to do the same. I worry about the young and low earners .

trappedsincesundaymorn · 14/03/2021 13:22

IMHO there should be a cap on house prices and rents.

Ellpellwood · 14/03/2021 13:27

I'm sure it does help "young" people e.g. 2 28 year olds who earn £40k each in London and are struggling with a deposit because their trendy flat is £1500 a month. That's about it.

coldwarenigma · 14/03/2021 14:25

Private rents should be capped at the same as local social housing.If landlords cant afford that they should sell, more properties will bring prices down.

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