Page 16 | To wonder where the money is coming from to buy houses?

00100001 · 2022-02-13T22:35:24+00:00

So, if houses used to be (say) 4-5x average annual salary back in the olden days of the boomers. And now house prices are 10 X average salary... Bit they're still being bought, and people want to buy... Where is this money coming from? Are boomer parents artificially inflating house prices by giving huge sums of money by releasing equity etc? Who is buying the expensive houses??

Blossomtoes · 14/02/2022 13:41

Who says it’s not popular? I haven’t seen an outcry about it.

weansu · 14/02/2022 13:42

It will be interesting to see the impact of inflation, I think rates will go up pretty soon again, some are now saying they will be 2% by the end of the yr.

Blossomtoes · 14/02/2022 13:45

@weansu

It will be interesting to see the impact of inflation, I think rates will go up pretty soon again, some are now saying they will be 2% by the end of the yr.

That’s excellent news because they’re running at about 7% at the moment.

weansu · 14/02/2022 13:46

@Blossomtoes I have no idea what you read so perhaps that is what you think 🤷🏻‍♀️. I've not seen any articles where it's presented that pensioners found it popular but feel free to link them.

Inflation may also mean they will have to suspend it for another year, which I suppose will also be popular?

weansu · 14/02/2022 13:51

@Blossomtoes That’s excellent news because they’re running at about 7% at the moment. Where have you seen this, that's not the figure they have claimed it is?

Itsnotdeep · 14/02/2022 13:53

I earned alot of money and was able to buy a flat with my then boyfriend in 1994. No help.

I don't understand these threads - surely instead of complaining about "boomers" (and why the constant bitterness? I don't get it) the young people today (and I include my children in that) just need to adapt their expectations? Property ownership isn't a right and most people won't be able to do it unless they have substantial parental help (whether it's in the form of cash, inheritance or being able to live at home to save up).

weansu · 14/02/2022 13:54

I mean the BOE still think inflation is temporary & a blip. I'm not so sure.

weansu · 14/02/2022 13:55

Property ownership isn't a right and most people won't be able to do it unless they have substantial parental help (whether it's in the form of cash, inheritance or being able to live at home to save up).

This is not a good thing...

Blossomtoes · 14/02/2022 13:55

[quote weansu]**@Blossomtoes* That’s excellent news because they’re running at about 7% at the moment.* Where have you seen this, that's not the figure they have claimed it is? [/quote]
www.bankofengland.co.uk/knowledgebank/will-inflation-in-the-uk-keep-rising

Second paragraph.

weansu · 14/02/2022 13:59

@Blossomtoes

"We expect inflation to rise to over 7% in spring 2022. "

I'm aware of that article.

I read it as rates will continue to rise to over 7% in Spring. We are not in Spring yet & the BOE do not consider rates already to be at 7% is my interpretation.

ManicPixie · 14/02/2022 13:59

@Seashor

My son has just bought a house with his girlfriend. 70 thousand deposit. They worked their arses off, didn’t spend on false nails, hair, etc. They lived at home and they didn’t decide to have children and then bleat on about how the ‘Boomers’ had it so easy. They didn’t! They were also prepared to move to a cheaper area.

It is an irrefutable fact that boomers had it easier when buying their first property.

weansu · 14/02/2022 14:01

If they are already at 7% then the BOE will need to increase rates asap as they are certainly on the back foot.

Lampzade · 14/02/2022 14:03

My aunt gave my cousin £100k towards a deposit. She then gave him another £50 k towards refurbishment/ furniture
Many people get gifts/inheritances

ManicPixie · 14/02/2022 14:04

@Itsnotdeep

I earned alot of money and was able to buy a flat with my then boyfriend in 1994. No help.

I don't understand these threads - surely instead of complaining about "boomers" (and why the constant bitterness? I don't get it) the young people today (and I include my children in that) just need to adapt their expectations? Property ownership isn't a right and most people won't be able to do it unless they have substantial parental help (whether it's in the form of cash, inheritance or being able to live at home to save up).

I own a house so it’s not an issue that affects me, but if everyone agrees housing is ludicrously expensive and politicians do nothing to alleviate it then yes, I can understand the resentment. Saying ‘adapt’ doesn’t help if it only gets worse and worse every year.

Blossomtoes · 14/02/2022 14:06

It is an irrefutable fact that boomers had it easier when buying their first property.

And Gen Y - basically anyone who bought before 2008.

It’s widely believed by economists that interest rates will rise more than once this year @weansu.

Iamthewombat · 14/02/2022 14:07

When I read these threads (and Kirstie Allsopp’s online musings) I feel so sorry for younger people.

It would infuriate me to read endless bits of advice from people who lived on soup made from grass clippings whilst living in their parents’ box room drinking tap water for ten years to save up enough deposit to get a 35 year mortgage on some overpriced pile of bricks. Yes, I am exaggerating for comic effect.

However, why do we persist in telling younger people that they can’t have any fun AT ALL, and if they go out for brunch involving an avocado once a month, or go to the gym, or go on holiday, or buy new clothes to go clubbing in, or move out of home to find their independence, they just haven’t earned the right to own a home of their own, ever? Oh yeah, and their expectations are too high an’ all! Think you’re special, do ya? Snowflakes, the lot of you! No wonder they get annoyed. So would I be.

All this ‘I did it and so can you if you try hard enough’ bollocks! I wouldn’t say that. I’m 50, generation X. I had it very easy compared to today’s twentysomethings, and I wouldn’t have the brass neck to pretend otherwise.

I could buy a 3 bed house in a suburb of Manchester on a salary not much above average when I was 26, in 1998. Sheer luck. I went clubbing all the time and went on holiday and bought new clothes too. I didn’t have to pay for my degree, more luck because I was born at the right time. I got windfalls from building societies that became banks: sheer luck. It’s insulting to younger people to pretend that it was anything other than dumb luck.

LuckyAmy1986 · 14/02/2022 14:09

@Seashor saving up while both living at home isn’t as much of an achievement as you think it us!!!

Zilla1 · 14/02/2022 14:15

Regarding politicians 'doing nothing', how would a government that engineered a significant reduction in average house prices be rewarded? With a hearty thanks by those looking to buy and those with DCs who are not home owners? Or by fury by the average homeowner? And then take into account what happens to the availability of mortgages and the availability of property when house prices do crash/significantly reduce in the UK?

Yeahthat · 14/02/2022 14:21

@Itsnotdeep

I earned alot of money and was able to buy a flat with my then boyfriend in 1994. No help.

I don't understand these threads - surely instead of complaining about "boomers" (and why the constant bitterness? I don't get it) the young people today (and I include my children in that) just need to adapt their expectations? Property ownership isn't a right and most people won't be able to do it unless they have substantial parental help (whether it's in the form of cash, inheritance or being able to live at home to save up).

Most people won't (and why should they?) adapt their expectations in order to happily maintain a system that they have no stake in.

When property ownership becomes increasingly impossible, with people at the mercy of a rental market largely governed by the rent-seeking behaviour of those who regard housing not as a right, but a resource to be hoovered up, hoarded and inflated - then they will begin to look and vote for more radical solutions.

There are myriad examples - just from recent times, Brexit and Trump; when people feel that mainstream politics won't address their issues, they will look for more extreme solutions.

A young person starting out now, presented with the option that home ownership is out of reach, and they must simply work for decades to pay back the money that someone else borrowed, with little security while they do so - why would they continue to vote to perpetuate such a system?

Scarlettpixie · 14/02/2022 14:21

You can still get houses in the midlands for 4-5 times average annual salary and if you consider lots of people buy with someone else…

.

Lampzade · 14/02/2022 14:22

@Iamthewombat

When I read these threads (and Kirstie Allsopp’s online musings) I feel so sorry for younger people.

It would infuriate me to read endless bits of advice from people who lived on soup made from grass clippings whilst living in their parents’ box room drinking tap water for ten years to save up enough deposit to get a 35 year mortgage on some overpriced pile of bricks. Yes, I am exaggerating for comic effect.

However, why do we persist in telling younger people that they can’t have any fun AT ALL, and if they go out for brunch involving an avocado once a month, or go to the gym, or go on holiday, or buy new clothes to go clubbing in, or move out of home to find their independence, they just haven’t earned the right to own a home of their own, ever? Oh yeah, and their expectations are too high an’ all! Think you’re special, do ya? Snowflakes, the lot of you! No wonder they get annoyed. So would I be.

All this ‘I did it and so can you if you try hard enough’ bollocks! I wouldn’t say that. I’m 50, generation X. I had it very easy compared to today’s twentysomethings, and I wouldn’t have the brass neck to pretend otherwise.

I could buy a 3 bed house in a suburb of Manchester on a salary not much above average when I was 26, in 1998. Sheer luck. I went clubbing all the time and went on holiday and bought new clothes too. I didn’t have to pay for my degree, more luck because I was born at the right time. I got windfalls from building societies that became banks: sheer luck. It’s insulting to younger people to pretend that it was anything other than dumb luck.

This

ManicPixie · 14/02/2022 14:28

@Zilla1

Regarding politicians 'doing nothing', how would a government that engineered a significant reduction in average house prices be rewarded? With a hearty thanks by those looking to buy and those with DCs who are not home owners? Or by fury by the average homeowner? And then take into account what happens to the availability of mortgages and the availability of property when house prices do crash/significantly reduce in the UK?

We’ll that’s the problem isn’t it - for anyone over 50 there isn’t a housing crisis, just a growing mountain of passive wealth accumulation. And that’s why nothing will happen, even though economic mechanisms are there.

Mollysocks · 14/02/2022 14:29

Yeah those avocados are so expensive 🙄

This has been my thought throughout! Where did this ‘avocado on toast’ thing come from? I’d understand if people were saying they’re spending their money on caviar and champagne but avocado? An avocado costs 70p and a tin of baked beans, with the little pork sausages in, costs 70p. So what people are saying then, is that people shouldn’t eat to afford a house??

Yeahthat · 14/02/2022 14:34

@Mollysocks

Yup; it's lazy and stupid. Do the maths and it's objectively far more difficult for young people nowadays to buy homes, including when you work out the potential savings from not buying the mythical avocado toast, or reducing Starbucks coffees.

OpheliaThrupps · 14/02/2022 14:36

So what people are saying then, is that people shouldn’t eat to afford a house??

I think what they're saying is that is more people lived more frugally then more people would have more money for a deposit. They are not saying that if Diesel and Zoozoo give up avocados a loft apartment in Dalston will be theirs.