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

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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??

Average deposit in the U.K. is £40k. Average salary is £25k. This results in take home pay of £1,700 a month.

If average person manages to save £250 a month from their £1,700 wage and their partner does the same, they can save £6000 a year.

If they had both started saving 6 years ago they would now have a total of £36,000. With the LISA bonus this results in a deposit of £45k.

It’s much easier to buy a house if you have a partner and you have an average or higher wage. But it can be done for the average person. Also it assumes you start saving a few years before you actually want to buy a house not the year before.

I really feel sorry for people under say 21 as they can’t really save quicker than house prices are increasing.

But for a lot of people over say 28 they could have started saving years ago. Obviously there will always be people who had a shitty hand and circumstances were not in their favour. Also if you have children before buying a house it’s even harder.

Let’s not forget the other small matter pushing up house prices in the capital, which then pushes up the nearby regions, which then push up more distant ones - corruption in London, aka all that lovely ‘foreign investment’ in the financial markets. Thanks for the reminder BBC www.bbc.co.uk/news/60348046 I often think we’d all have been better off if London had followed through on its threat to declare independence after Brexit, it’s the place we all do want to get rid of.

But no, it doesn’t let local buy-to-let landlords off the hook, it’s merely another factor. And obligatory reminder again - not everyone has parents they can live with for free to save up deposit money. That should not mean such people are forced to labour for nothing for all of their lives, compounding their lack of privilege down into the next generation.

Averages mean nothing in a country with income inequality, weren’t you taught that in primary school?

Averages obviously used for purposes of average calculation! I can’t go through every scenario. In my area average house deposit would be about £20k.

@LittleGwyneth

I completely agree. When facing the prospect of saving for 10 years, whilst you scrimp and watching prices go up quicker than inflation...it's must be a seemingly impossible task!

@XjustagirlX sorry I’m always a bit irritable after coming across the financial corruption. The U.K. is an embarrassment now imo.

It's utterly shit for millenials. I'm generation x and bought a flat with a 100% mortgage in 2006. That mortgage was so much cheaper than renting it was a no brainer. 10 years later it provided the deposit for my milenial husband and my first house which is a decent family home in a good area. My husband is a higher rate tax payer so would have eventually been able to save a deposit to buy a small flat but he would have been in his mid thirties before that happened. I am an average earner but it was easy for me to get on the first rung of the ladder.
My parents did scrimp and save to buy , but they bought a three bed semi as their first house at 22 which was twice my dad's income!!

[quote LittleGwyneth]@joydivisionovengloves71 Even if you remove the laughable part of your hypothesis where someone automatically has the privilege of living at home for five years, 18K as a deposit for a small flat?

The average house price in London is £514K. You'd need to live with your parents until you were nearly 30 at that rate. Not everyone lives in an area where you can buy a small flat for less than 200K. You'd be hard pressed to get one for less than 350K where I live. Which happens to be where my job, family and friends are.

No-one is denying that there is an element of sacrifice in saving for a deposit and always has been, but trying to save £50K is no joke, and isn't achieved by giving up a few lipsticks and holidays.[/quote]
Well your average young single person isn't going to be looking for a house in central London 🙄 Also years ago people were happy to buy a cheap doer upper in a less desirable area and progress from there. But that's not acceptable these days.

Also years ago people were happy to buy a cheap doer upper in a less desirable area and progress from there.

Many people feel very stressed living in a fixer upper and do not have the time or skills to make it decent. It shouldn't be the case that FTBs are expected to live in a building site because nothing else is affordable.

@Boombastic22

It’s simply wonderful how many posters seem to miss the point that people can save for deposits because they live with their parents…, it’s not rocket science!!

Yes but they don't, then moan on here

@XjustagirlX

Average deposit in the U.K. is £40k. Average salary is £25k. This results in take home pay of £1,700 a month.

If average person manages to save £250 a month from their £1,700 wage and their partner does the same, they can save £6000 a year.

If they had both started saving 6 years ago they would now have a total of £36,000. With the LISA bonus this results in a deposit of £45k.

It’s much easier to buy a house if you have a partner and you have an average or higher wage. But it can be done for the average person. Also it assumes you start saving a few years before you actually want to buy a house not the year before.

I really feel sorry for people under say 21 as they can’t really save quicker than house prices are increasing.

But for a lot of people over say 28 they could have started saving years ago. Obviously there will always be people who had a shitty hand and circumstances were not in their favour. Also if you have children before buying a house it’s even harder.

Totally agree! The trope that a lipstick or an avocado wont buy you a house is ridiculous. No one said it would. However The amount of discretionary spending on appearance in the UK is phenomenal. High end lipsticks like CT are £25 not £15, palettes are around £36-£60. Your average, very attractive, tanned, glossy haired, beautifully made up young woman has spent a fortune to look like that unless very lucky. Hair extensions, eyebrows, lashes, spray tan, high end make up, botox, filler,nails, waxing or laser, spa days. Gym, PT or peloton. Dyson hairdryers and hair wraps

What people spend their money on is entirely up to them but you cant spend it twice!
Many of the above things are considered essential,so no that money wont be available to save.
Add in holidays and an expensive car on PCP and you are stuffed.
No not everyone earns enough for those things anyway highlighted so its not missed and therefore wont be able to save that money but the industry is huge.
Bizarre to keep denying it.

Several of my colleagues all in couples, both earning 25-28k have all saved and bought houses recently, no parental help.
All cut back massively and prioritised buying
a house over other things.

@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.

You're getting a lot of shit but I agree with you. We're millennials as well and bought young. We had no external help and we didn't live with parents either. I know couples with extremely similar salaries who are complaining about boomers had it easy but they're not making any sacrifices.

And before anyone jumps on me as well I know a lot of people actually cannot afford it but at the same time there are so many professionals who could if they just saved more (including the famous avocado 🥑)

An amount must come from people who have a house moving to another. There is no way I could afford a house that cost twice the price I paid for mine 12 years ago, yet I can get almost twice the amount now for it.

@DrSbaitso

Also years ago people were happy to buy a cheap doer upper in a less desirable area and progress from there.

Many people feel very stressed living in a fixer upper and do not have the time or skills to make it decent. It shouldn't be the case that FTBs are expected to live in a building site because nothing else is affordable.

I'm talking about very dated, needs some modernisation but not actually falling down. But that's not suitable for the insta posts

@joydivisionovengloves71

The average property is £268,349
Meaning, that, generally a FTB would need to find £26.8k + fees, let's just round it to £30k for convenience.

A significant sum.

Also, why should people be forced to buy "fixer uppers" because the good properties are so very expensive (which might be partly due to Bank of Mum and Dad) when they just shouldn't be

An average person on average income should be able to afford an average prices house. But they just can't, without saving for an incredibly long time, or getting help from someone.

What did we blame for everything we didn't approve of before Instagram?

People don't buy nice houses for Instagram, they buy nice houses because it's more enjoyable to live in a nice house.

What did we blame for everything we didn't approve of before Instagram?

Woman’s Own, probably. Or shops. Or anything else giving those darned youngsters ideas above their station. And, for avocados, read ‘wine’ or ‘eating anything that isn’t tripe and onions’.

Also years ago people were happy to buy a cheap doer upper in a less desirable area and progress from there. But that's not acceptable these days.

Says who? The problem I've found is the doer uppers are actually that cheap.

I can't think of anyone on our street who could afford to buy their house if they had to start from scratch now.

There's a doer upper down the road from us that's just gone on sale for £750,000. It's a normal 1930s semi. You'd need a £75,000 deposit plus £27,500 stamp duty in your account, before you get to do it up.

You'd also need a household income of £150k to get a mortgage on it. Good luck!

@isitthestew

There's a doer upper down the road from us that's just gone on sale for £750,000. It's a normal 1930s semi. You'd need a £75,000 deposit plus £27,500 stamp duty in your account, before you get to do it up.

You'd also need a household income of £150k to get a mortgage on it. Good luck!

Perhaps someone can fund it from their profits from Instagram.

@pateu

Also years ago people were happy to buy a cheap doer upper in a less desirable area and progress from there. But that's not acceptable these days.

Says who? The problem I've found is the doer uppers are actually that cheap.

I found that they’re actually the same price as the ones that have already done or extremely close in price.

@DrSbaitso

What did we blame for everything we didn't approve of before Instagram?

People don't buy nice houses for Instagram, they buy nice houses because it's more enjoyable to live in a nice house.

Women's magazines, I think. Apparently we've always been too shallow of a sex to like nice things because they are inherently nice, we must be told by some higher power what we like.

[quote 00100001]@joydivisionovengloves71

The average property is £268,349
Meaning, that, generally a FTB would need to find £26.8k + fees, let's just round it to £30k for convenience.

A significant sum.

Also, why should people be forced to buy "fixer uppers" because the good properties are so very expensive (which might be partly due to Bank of Mum and Dad) when they just shouldn't be

An average person on average income should be able to afford an average prices house. But they just can't, without saving for an incredibly long time, or getting help from someone.[/quote]
That might be the average price but that includes houses too. Does you average young person want to live in a semi? Your average 1 bed flat is not that price. I'm not talking about families, I'm referring to people in their early to mid twenties who've lived at home and earned a minimum wage, are capable of saving but prefer to blow most of it. My son is almost 30 and owns his own house, but freely admits he wishes he'd not been so frivolous after university.

We live in a 2-bedroom flat (by choice, we downsized many years ago) and though the houses in our area are now silly money, half a million for a semi, the flat prices have stagnated and barely moved. If a FTB was hoping to use equity from one of these flats to move up the ladder, they'd be sorely disappointed and of course you can raise a family in a flat but I'm sure most would prefer a house and a garden. House prices in the south east are ridiculously high and no amount of cutting down on non-essentials will help a FTB.