To wonder how the next generation will buy a house

[macaronitoni]

Surely there needs to be a massive overhaul of the system. A new build home with two bedrooms on a new development nearby is £315k. Not London. Midlands. Who’s going to be buying that? Too small for a family with more than one DC but way out of budget for most first time buyers.

Without significant family help, how will today’s children and young people manage to buy a house? Something has to change!

Flat prices in my area of London (1930s build) have not risen since 2015. And it is definitely not going up in the next 2 years! That's like a 10 year stagnation...

I live in the NE and prices were stationary from 2008 until the pandemic. We made no money on a house we bought in 2003 and sold in 2018. Interestingly the first owners bought the house when it was built in 1922 for £870 and sold it in 1947 for £900. House prices do not always go up, they often stay still.

This is why I don't get why people are still judged for living at home. If you're single and not in a great paying job then you have no chance of getting onto the property ladder unless you come into a inheritance.

The only people who are winning now are the mortgage free and those living at home. You have no chance of being mortgage free if you are below 35 (or else very exceptional!)

Even those currently on fixed deals will have to pay the higher interest rates once they roll off their deals. Rents have been increasing steadily for years and now their is a real shortage. I am hoping to upsize but the flipside of it is that I have to sell at a loss probably and pay a lot more in interest. I have an ex neighbour who sold her flat and moved back in with her parents to wait for the house prices to drop. She has kids too.

I am not complaining, I think it's a good thing.it allows wages some time to catch up... But what is curious is that rents have skyrocketed. When I bought in 2019, the equivalent flat would have cost £1400 to rent. It now costs £1800 to rent..

I assume it’s because landlords mortgage costs have also increased so they put up the rent to mitigate this. Also, if fewer people can afford to buy, there are more people chasing fewer rentals so supply and demand pushes the price up.

Many of that generation will not have inheritance because care home costs will use up any funds!

I guess they'll have to learn how to live without an inheritance as working class people do.

They won't. Unless they can live at home long enough to save up or their parents give them a large deposit, the next generation is completely screwed. Even if they get well paying jobs, it's unachievable without a helping hand.

Not much use if you’re nearly retirement age yourself when your parents die.

Some of the boomers, like my dad, died before their parents. In his case the inheritance came down to us instead as there was no will.
in the case of my son I can’t see him moving out

It would work for some families, although I don't know how inheritance tax factors in

But if you live in London a family home is one million. So if there are three siblings all they will really have is enough for a flat deposit

DC's grandmothers, born 1929 and 1935, were both still alive last summer when we reached state retirement age. What we inherit (not wealth, but tidy net sums from property, after care home fees) is likely to skip our generation to benefit DC. We are boomers and have done okay for ourselves without inheritance, as most of MN points out regularly.

Only 4% of people end up in a care home.

@SavoirFlair , we’ve been in the fortunate position of being able to give substantial help to dcs, for house purchases. But I disagree 100% that people who can afford to do so, like high house prices. I know of many in the same position as us, who utterly deplore them and wish they’d come down to more affordable levels, for the many who can’t expect any help.

4% really where did you find that statistic?

Approximately 418,000 people live in care homes (Laing and Buisson survey 2016). This is 4% of the total population aged 65 years and over, rising to 15% of those aged 85 or more. 167,000 people are receiving specialist dementia care in care homes – around 40% of the total care home population.

It rises with age but average life expectancy is 81 so the over 85 figure is a vanishingly small number of people.

I'm sorry to hear that. Do you think they are entitled to inherit a house each for free?

I think it will be very hard, it already is for most. At the moment there are people who probably did have the means to buy at some point but wanted to live in a particular area in order to access as certain lifestyle, they couldn't afford to buy there so they rented and many are now being pushed out by ever increasing rents. Quite a few people I know now don't have savings for deposits in their late 30s - early 40's after renting for 20 years.

Some will get family help and will move out to cheaper area's pushing up the cost of housing there too. Some will end out paying though the nose for grottier and grottier flats.

I don't live in a wealthy area and all the new developments round here are for "luxury" homes. You know the sort, tiny rooms, tiny gardens, "detached" but only a 10 inch gap between the homes. Starting at half a million for a 4 bedroom house. Even people in professional jobs round here would struggle to pay that yet they do sell. It's all very odd.

It doesn't really work like that. They don't just all die in one go. They die gradually, as they are now but because the population is in growth there will always be more demand than supply from people simply dying off.

When we allowed people with all the business acumen of a labrador to finance their "investments" with poorly regulated debt we were always going to end up in the shit.

That isn’t true. The boomer generation covers 19 years. We’ll be dying like flies in the next couple of decades and population growth is slowing right down now. The birth rate is decreasing.

@Honeychickpea no, but if I had a house I'd want my children to be able to keep it and either share or one of them
Live in it and use my other inheritance like pension and savings to buy the other out. not have to sell it due to tax.

Tough. If a half million tax free windfall between them isn’t enough for your kids your parenting has gone spectacularly wrong.

It is. In the 2010 census the ration of people dying to people being born was 1:2.39. It's expected to be 1:1.3ish in 2020, so better but still will be more people born than dying. And yes the boomer generation covers 19 years but I don't know why you think they are going to die any quicker or make any more difference to housing stock than the people who died before them.