Bank of mum and dad

[squidwid]

To think it's very hard to have it all, house, kids without the help of bank of mum and dad nowadays?

Actually, those are calculations based on real figures, and I didn't make them up.

It is extremely rude of you to say so.

My car is a 12yo Yaris, bought at 9yo with a full dealer service history and full MOT for £3100. I have spent £100 total on the last three MOTs. It's actually worth more now.

Don't be so bloody rude in future.

@Camablanca - no, not exactly. Figures provided above.

Plenty of people run cars this way.

I can well believe a decent three year old car could be got for 3k in 2014, and that with careful maintenance it's still going. And a car having been bought before covid and lockdown completely revolutionised the second hand car market is a more likely explanation than someone lying.

However, it's not going to tell us anything much about the choices people face between used cars and leases now. The situation for people who are continuing to run second hand cars that they brought pre 2020 is very advantageous, yes, but also not one that continues to be available to new entrants.

The opposite in fact: a second hand car bought pre-Covid can currently be sold with little depreciation because of the shortage of new cars increasing second hand prices. So it's a very good time for second hand car owners to sell and lease instead (once new cars become more available again second hand prices are likely to drop significantly, back towards long-term trend levels, with much higher depreciation). And yes, very bad time for any new buyer to buy a second-hand car for the first time, because prices are sky high compared to norm. Trading from one second hand car to another won't make much difference as both are being sold/ purchased for much more than they are really "worth". But a PP who said young people who are looking for a first car should automatically think a second hand car is a better deal atm was totally wrong: they would pay an inflated price for it and take on a lot of risk plus opportunity cost in terms of upfront cash and leasing a new car might be far better for them.

I think a lot of these posts come from not understanding economics and so you get the "I have always done this and it works for me" posts without any comprehension of wider economic circumstances.

We've been out looking for a car for our 21 year old who's just finishing Uni and will need a car for his new graduate job starting in the Summer. Found loads of decent cars under £10k that we'd be happy with. Including a 6 year old Ford Focus in immaculate condition, full service history and below average mileage for £8k - not a particularly nice colour, but our son doesn't care.

We also found a cracking little 15 year old car that was literally identical to my car - same age, same colour, same mileage, same full service history, for £2,750. Mine is still going strong, minimal service costs, immaculate as I've looked after it cosmetically and driven carefully. I confidently expect mine to last another 2 or 3 years, so son is seriously considering buying this identical one and taking a punt on it as he learned to drive in mine and currently uses it, so it's literally "like for like" for him and minimal cost!

Cars last an average 13 years at the moment, so anything under 6 or 7 years old is probably only half way through it's life, and a full service history and below average mileage will mean it's likely to last even longer and not need too much in the way of repairs, etc.

Just stay away from the big firms and main dealerships who are profiteering at the moment. Find some local independent reputable used car dealers - we've such a dealer in our village with about a dozen cars on his forecourt - we've lived in the village 26 years and he's been here all that time. Locals are happy to buy from him as he's trustworthy and knows he has a reputation to maintain.

@AlienEgg

(once new cars become more available again second hand prices are likely to drop significantly, back towards long-term trend levels, with much higher depreciation)

Not too sure they'll fall to be honest. There's quite a demand for "petrol" cars now that most manufacturers are moving over to hybrid or electric, which aren't suitable for lots of people for one reason or another, so I suspect demand for second hand petrol cars will remain high for several years.

There are enormous problems with buying flats not-in-London that have bitten people on the arse.

One, cladding regulation changes meaning many cannot sell.

Two, increasing "management" charges. My friend in the NE was paying £150pcm on a £100k flat meaning her mortgage plus that was not, in fact, less than rent.

Three - Covid. Houses have increased less due to lack of outdoor space.

Er, flats have increased less. Not houses! Mistype.

Agree that second hand cars have increased a lot recently but you are missing out the fact that if you get one in a good condition even after 5 years you should be able to sell it on/part exchange it for something.

So it's not 8-10k over 5 years if you get 2k for it afterwards.

I've also been lucky with 2nd hand cars in that I've always had them from family members so know they are in good nick and got a good price. It's always worked out much cheaper for me than renting.

But its horses for courses - different options are better depending on what individuals want, there's no absolute "best" solution.

Yes, management charges are a major issue. I've also got a friend who bought in Liverpool - management charges went up 50% in a year. Maintenance not done, hallways filthy, etc. She's in the middle of a protracted battle with the management company to contest it, but it's very difficult and expensive. There's very little regulation.

But then again, there's very little 'need' to buy a flat outside London - if you're willing to live a bit further from anywhere you can get a 2 bed flat for a bit more. Unless you insist on living in the Cheshire Golden Triangle or whatever. But that's not a necessity if you can't afford it.

I addressed that point in my posts.

I think having any access to the bank of mum & dad is a tremendous privilege which most people don't have.

We worked hard, 3 kids, 2 cars, big house with zero help from parents. Not childcare, not emergency loans, nothing. We lived without heating for 2 years with a baby and a toddler as our heating broke and my inlaws are millionaires.

Granted, we will benefit when they die, but we are proud of getting no help. SIL always had access to the bank of mum & Dad which DH didn't, which was grating when we were freezing and they bought her a new car as hers was repossessed but it is what it is.

Yes, management charges are a major issue. I've also got a friend who bought in Liverpool - management charges went up 50% in a year. Maintenance not done, hallways filthy, etc. She's in the middle of a protracted battle with the management company to contest it, but it's very difficult and expensive. There's very little regulation.

I don't think anybody sensible contemplates buying any property with "management charges" these days, it's well known to be a total rip off and mean your property is worth way less than one a comparable size without them, maybe 50% less if you calculate it properly.

No bank of mum and dad here, I don't have a dad and my mum struggles for money herself. I live in a housing association flat, will never own a house unless I win some money.

@MooseAndSquirrelLoveFlannel oh no, that's awful. Why would you do that to your son. It's one thing making your own way - it's another when you risk illness from being cold.

PIL will openly say they support SIL as they worry about her more. She is the same as us, long term partner, good jobs, 2 kids, large house etc. But they are awful with money. I'm talking council tax debt, repossessed cars, MIL would order food shopping for SIL yet when we were really poor my friend 200 miles away posted me cartons of baby milk because we couldn't afford to buy any.

It hurt then, now I think it's made us stronger. We survived, we improved our situation and we did it on our own. SIL is 40 and still needs financial support from her parents.