To think there’s no good option for first time buyers

[ton29]

Prepared to be told it’s always been like this but I’m not quite sure it has.

On our combined income as it is now (both earn the average UK salary) in 2018 we would have been able to buy a 3 bed semi, possibly 3 bed detached in a really lovely area. We couldn’t buy then as we were still students.

Fast forward to this year and prices have rocketed so much so the same houses are 60-80k more making them unaffordable.

Buying a flat isn’t always the answer if you’re going to outgrow it immediately because if you move fairly quickly after buying, there’s the risk of negative equity and costs associated like legal fees and stamp duty on the new property.

Buying a house in need of renovation isn’t suitable for everyone. It’s ok if you have family help or are quite creatively minded, but if you work very busy 9-5s it’s soon going to get expensive and untenable to rip up flooring and knock through walls.

Moving 30-40 miles away to a cheaper area makes life inconvenient for commuting to work and seeing family.

I’m not sure why you can no longer buy the average sized house when you are on average sized salaries. Buying wouldn’t be an issue either if it was more secure to rent, but as everyone knows renting in this country is huge instability.

I wish I could pin your response to the top of this thread. You’re so spot on. Many people don’t see it.

We were FTBers a long time ago when house prices were fairly cheap, however as we didn't earn much and are cautious purchasers, we went for space over location. Bought a 3 bed semi in a rough area. Moved a few years later and doubled our mortgage to get to a better area with good schools and have kids.

Unfortunately in house buying there is always a compromise and I appreciate that the prices are ridiculous now for FTB, I fear for my kids getting on the ladder.

I’m glad things worked for you. I think less and less people will own homes in years to come, for sure

Looking back is often painful with the UK property market. I bought 20 years ago, but if I had bought 22 years ago I could have paid half the price or got twice as much for my money..but as time passed what I paid looks good to those who bought later.

If you were students 5 years ago you are probably young and building towards higher salaries. The market is flat so there is no rush to buy, and time is on your side to earn more, save more and be in a position to buy what you want (or, like most of us, the best you can afford) in a few years time.

The point still stands that if you are 32 and want to buy a 3 bed detached, then the equivalent requirement to go straight into a family home (instead of being on the property ladder) is to have spent 10 years saving a deposit, plus the equity you would have paid down over 10 years on a smaller property, plus the equity you've gained if prices have gone up. While renting.

It's one reason Shared Ownership is getting so popular, and I get it. 3 bed semi in Oxfordshire, £330k full market value, but you can get one with a £110k mortgage.

We started with a teeny tiny one bedroom flat next to a builders yard, low salaries, got a deposit from my Dad, which we had to repay. Then moved to a two bedroom terrace on an estate, then to a small four bedroom, on a different estate, now we are in a five bedroom in the country. It took 25 years to do, some serious saving, and we had high interest and negative equity thrown in at various moves. Our luck was good job progression, and interest only mortgages, although the endowments we bought to cover the shortfall didn't pay out either, so needed extra for that too. It's never been "easy".

That’s really good, I suppose with shared ownership you’ve got the security of not having the landlord just sell your home

@AndIKnewYouMeantIt yes that's why we did HTB when we upsized. The situation in 2017 really wasn't much different, with a limited deposit and already into our 30s with children our options were as the OP described; location, size or project. We chose to compromise on size which was the wrong move, out grew too quickly and cost a fortune to then move again just as the other poster says is the issue today (although granted HTB isn't available now but I suspect something else will be soon). It's hard at the moment because house prices are still stubbornly high but interest rates have gone up, I'm not saying buying now is the same as in 2017 but I think to varying degrees of difficulty the choice will always be size, location and condition, for most buyers.

Agree completely

We bought a 60% share of a 2 bed house in 2012 (shared ownership). You needed a 10% deposit at the time. It was the only way we could get on the ladder.
7 years later, (with pay rises for us during this time) we staircased and bought the remaining 40%.
Following year we sold the house, and bought our 3 bed ideal home.
You hear a lot of horror stories on shared ownership, however our hope was always to staircase when we could. I really would recommend it, as for us it was a positive experience.

This sounds great, especially given you ended up owning all of it.

Getting on the housing ladder has never been as easy as some people seem to think it was.

To buy my first house (won't call it home as it never was) I had to move 25-miles away and buy a run-down ex-council house in a really rough part of town.
My dad helped A LOT and over the next 3-months it was brought up to a habitable standard to allow me to move in and from then on I did all I could (decorating etc) to make it look as nice as possible. 3-Years later I sold and bought a nice house (in an area of my choice) which I was content to stay in for the foreseeable future although there were still financial constraints which meant I knew I would be moving again at some point.
Moved into our forever home last year so hopefully the moving boxes can be put away never to be used again!

Says the person who clearly never had a minute chance of being in negative equity.

We bought a typical 'starter home' (2 up, 2 down terrace) a decade ago. Realistically with personal circumstances and c.o.l. it has now become our forever home. That means there is one less starter home on the market and I am sure this is a situation that is replicated everywhere. Then throw in those who downsize (so can be a cash buyer) to free up money for retirement and that reduces even more of the typical starter home stock. I can understand why FTB are having to consider 3 beds as a first rung tbh.

Exactly, there are hardly any properties as you mention and the starter type ones are immediately snapped up - often by landlords. It’s a real issue

@AndIKnewYouMeantIt You know what I think it (partly) is? My gen (1980s) grew up, in my area anyway, in either pleasant detached homes (approx 90k) or solid Victorian terraces with big gardens (50k). We only saw what we were born into and see the mid range homes as normal.

You can’t be ignorant enough to assume everyone who grew up in the 80s lived in a detached house or a big Victorian with a big garden??
Surely you don’t actually believe that’s the experience of huge parts of the country!

Unless you’re in London! In which case a two bed flat in your 30s / 40s is perfectly normal (and still eye wateringly expensive)

I don’t get why people are kicking off about a nice 3 bed house with a garden not being a ftb house. I was a ftb and I bought a 3 bed, garden, driveway, in a nice place in 2018 without the bank of mum and dad 🤷🏻‍♀️ OP isn’t wrong.

We were stung at the end of last year when our 5 year fix came to an end though 😂

I'm talking about the particular Yorkshire village I grew up in. The lower income families/single parent families were able to afford the £35k terraces because they were only about 2.5 salary at the time. None of my primary school friends were in private rentals; it was all owned, or secure tenancies on the 3-road council-owned estate behind my house.

A lot of my peers grew up in houses their parents could afford in their 30s, that they now cannot afford in their own 30s. Please don't call me ignorant.

House prices are high and in some areas starter homes are difficult to afford on two average salaries.

But anyone deciding they only want a 3 bedroom house in a lovely area of their choice, don't want to do work on a house, don't want to look at areas that are a little inconvenient for their social lives etc is being unreasonable.

Thank you! Feel so seriously fed up that we can’t afford that now yet we could have had that EXACT thing if we were of age and stage to buy in 2018. Even a 2 up 2 down is a huge stretch for us now and means moving to a rubbish area. Looking at shared ownership for a nice 3 bed with the hope that it will gain in value anyway over the 5-10 years we stay there, meaning we will take away some equity to use against a bigger house on the open market. Sorry you were stung last year! I hope your next fix is cheaper in a a couple of years

Yep. One of my pet hates is my in-laws saying "If we could move this house X miles down the road to Cambridge it'd be worth £2m." I always think well yes but you couldn't have afforded the comparatively high Cambrige prices in 1994 when you bought the house!

Looking back is often painful with the UK property market.

As with any free market.
I bought a 2 bed flat in 1990. The price of them was double what my sister sold hers for in 1988 (v similar area, similar style). It was hard, very hard. Then all the prices dropped and when I moved to my first house 6 years later, had to sell for a LOT less than what I bought it for.

Yes, it is difficult for people to buy their first property, but it has always been the case. It's not some 2023 phenomena. It is very, very, very normal to move to a less desirable area, or to buy a property that needs a lot of work doing, or to aim a lot lower than a "3 bed semi with a garden" as your first property, or often a combination of those. I think your expectations are skewed.

If you look back to 2007 (before the financial crash), UK average house prices were around 189k. Using the Bank of England inflation calculator, that is 289k nowadays. It's actually 287k at the moment for the average house price (and it was 295k last June).

Average house prices in the UK have occasionally been above the 2007 price + inflation. 2007 was just as bad a time to buy as last year. Now is better.

The biggest problem is that wages have not kept up with inflation, and of course, that successive govenments have failed to meet the house building targets they themselves set. The planning system is arduous and often there is a lot of opposition locally. The government have stoked demand through all the giveaways to FTBs rather than focussing on supply.

It's not easy, but it wasn't always easier.

I don’t know, you seem reluctant to buy a smaller house. Most people work their way up to a proper family house.

Our first house was a two bed terrace in 2018. We moved last year to a three bed terrace which we consider to be a family house. I think you can’t expect to buy the big house first.