To be so sad about my slide in living standards?

[ColdNow]

I grew up in a not so nice area, but my parents had a big house with a huge garden that they bought on two fairly modest salaries when they were younger than I am now. My mum took years out of work when I was born and although things like holidays and eating out weren't a regular occurrence, my parents admit they were never really stressed about money despite having several children and easily paid off their mortgage.

Fast forward to now, where I did my very best to do the 'right' things. I got a good degree, decent and stable job, married and bought a property before TTC. I'm now pregnant and feeling so sad about our financial situation. We purposely went for a modest property with a tiny garden to give ourselves a buffer, but now with the huge increase in our mortgage repayments and other expenses we're struggling to keep afloat. I would love to work part time when I go back but it's now looking very unlikely that we'll be able to make it work without being extremely stretched. I'm always worried about money and already buy all my clothes second hand, shop at budget supermarkets etc. The main cost is housing though, because we live in an expensive city, but this is the city I grew up in and where all my family and friends are, and moving away would be a very difficult choice to make and remove us from all our support networks.

I just feel so sad that within a generation the things my parents were able to offer me (space, time) I'm not able to offer my child, despite me earning far more comparatively than they did. I'm also the youngest in my family and the older siblings are much better off than me, again just because of time - they got onto the property market much earlier before prices sky-rocketed and now although I don't earn a lot less than them, I'm only just scraping by. I notice this at work too, I have colleagues at the same level of seniority and pay to me but a decade or more older, and the houses and lifestyle they sustain far exceed mine.

I don't know what the purpose of this thread is except to just say that it makes me sad that this is the situation I'm in, and people younger than me (I'm in my early 30s) are even worse off.

Should have added to my points about opportunities being greater that the changes and opening opportunities are here because my generation from the 60s, and the ones before worked, for them, just as women worked for the right to vote, for private spaces, single-sex lavatories (I can't believe we are going there again), and opportunities that women could take up. I do not think everything is rosy and certainly, the idea that women should be able to be and act just like men, unfettered by their biology and that they are the bearers of children. That is not equality and needs to be rethought. But, even given that, living standards and opportunities have gone up exponentially for the majority of people. The past looks rosy from the point of view of the present, but really, it was by no means rosy, certainly not for the majority of women (and it still isn't, because of the assumption women want to be like men, an idea put forward in particular by politicians).

I hear you OP.

I think what I’m struggling with is the rapidity in which living standards and costs have changed.

I had my first child in 2015; I got pregnant at 21 so had none of my shit together but life was tbh great. Like your parents, while I wasn’t paying for holidays, we were okay and I was able to work part time, whatever shift pattern suited.

I now work full time and my family is struggling. One of my children has challenging behaviour and is very sensitive; his life and all of ours actually, would be infinitely better if I was finished work when he got home from school but financially there is just no chance of it happening.

Everything just feels a lot harder. Even feeding them healthily is painfully expensive. My son needs to school shoes and I’m sending him in PE plimsolls for the last week of school as I get paid in a few days and have absolutely no cash left. I haven’t gotten excited about Christmas this year as it’s just a huge financial strain

Hello OP. You are bemoaning that you are in your 30s, with children, and cannot offer what your parents offered you. But you are not comparing like with like. Those who are older than you have had mortgages longer. They probably felt just like you when they were ten years younger. Mortgage rates are not especially high at about 6%. In my thirties I was paying 15% on the maximum loan my then DH could get (I did not have my salary on the mortgage because we wanted children and I would stay at home with them). Most women stayed at home with their children, as it happened. Mid-thirties with children is when you will feel least well-off, have the least time, and feel overwhelmed. This has been the case for most of the twentieth century. What needs to change is not more housing or more money but restrictions on amounts that can be borrowed for a mortgage. This would, eventually, have an effect on the housing market and lower prices. Your parents, btw, if you are now in your thirties, bought a big house and garden when interest rates were 15% - so it cannot have been that rosy and they probably had to give up a lot, esp that your mother could be at home full-time I suspect.

When I was 20 the very thought of EVER buying a house - or owning a car - was beyond our imagination, an impossible dream. Only well-off people could buy houses or have cars, or go abroad.

I don’t recognise this. I was born in 1953, my parents owned a house and a car and had the odd Mediterranean holiday in 1973 on a bank clerk and a nurse’s wages.

They probably felt just like you when they were ten years younger.

Not really looking at the age of FTBs

Mortgage rates are not especially high at about 6%.

How many times, it’s about the price of something not the %. It’s not comparable

What needs to change is not more housing or more money but restrictions on amounts that can be borrowed for a mortgage.

happened after the 08 crash

The divide is between those who bought their home before the 2008 crash (we bought in the pit of the 1990s recession) and those who bought since 2008. We sit pretty having bought during a market trough, since when the trend has basically been upwards thanks to QE and very low interest rates on mortgages. But having been right on timing the market 30 years ago, I shall use the equity to ensure that my DC have a secure roof over their heads too. It might not be in their dream area to start with.

The divide is between those who bought their home before the 2008 crash (we bought in the pit of the 1990s recession) and those who bought since 2008.

As in some areas increased hugely after the crash like my friend’s house in London? My mum’s area prices did drop for a few years 2009 - 2015.

Where we live, in Cornwall, was still very poor in the late 1990s. House prices have taken flight here since then, and accelerated during the pandemic and WFH boom, plus there is a huge Airbnb element that started since 2010. Tiny two up, two downs (nicely titivated) cost £400 per week or more in summer instead of £550 per month on longer lets.

I don't own a second residential property so I have no skin in this game.

But it is getting ever harder to find anything affordable to live in. A friend (age 35) of my DS, thought he had found a flat in our local town. But his work is via an agency so he's considered self-employed. He is very well paid as the no 2 chef in a five star hotel.... but no, he doesn't have employment. He's been there for four years FFS. He earns way more as agency staff than he would if he was employed by the hotel.

I never said the older generation needs to downsize - where are you reading that ? Just that if you've had the benefit of living in a nice big house you shouldn't begrudge others ie next generation the same opportunity. If you are the type that sends objection letters to new housing developments (not saying you do) then I do think that is wrong. Housing development has significantly declined in this country whilst housing growth has gone up (mainly due to immigration but also other factors ) and people over 50 have benefitted significantly from that in terms of wealth if they bought before early 2000s. There will one day be a rebalancing (maybe too late for a lot of younger people now) - whether that's massive house building, taxing under-occupiers heavily when they no longer are a large voting cohort, or household growth drastically reducing - it maybe a mixture of policies.

I completely get where you are coming from, and in your position would be selfishly doing the same.

But the fact is that if you were to move to something more modest a family with kids would appreciate your house more. If the government was taxing you £50k per annum as a disincentive for an elderly couple to "hog" large family houses then you WOULD sell it for a price that a family could afford.

To be clear - I fully respect your right to enjoy the large house you worked for, but I also support the right for hard working families with children to live in family houses more than I support the right of elderly couples to live in large houses.

But there is also a massive divide between - say - a couple who paid £50k for a house in zone 3 in London in 1995, and their neighbours who paid £250k 11 years later, even if both are incredibly well off compared to the young today.

No-one expects to live in their dream area as an FTB, but it is reasonable of FTBs with very good jobs to be able to afford something half decent in a half decent area - at bare minimum, not a shithole in a shithole area.

Well my dad left school at 14 / 15 in the late 1950s and got an apprenticeship then worked in a factory. Within 15 years he had set up a business (he was a labourer all his life despite also running a business and employing people as well), bought a bungalow, built a house behind the bungalow and pulled the bungalow down. There were loads of opportunities he did not have that I did, but there are also plenty of opportunities he had that I didn't (and I was VERY luckY compared to those 10, 20, 30 years younger than me)

There are lots of opportunities that only come from cheap property - the opportunity to squat and pursue art. The opportunity to buy property cheap and use that income to go back to uni, or the opportunity to buy commercial property cheap and start a business which is much more sustainable than if you were paying a market rent. The opportunity to buy a builders yard for not much at all, and make a fortune running the business for 20 years before retiring at 45 when you sell the land for £4m to a developer.

Indeed there were opportunities. But not for most young people. And certainly not for women. And property was not cheap. The first house I looked at in 1974 was 8k (a three-bed terrace with a small garden in Basingstoke). That was not cheap and we could not get a mortgage on my ex-DH's salary (I earned more than him but the building society would not take my income into account) because it was more than 3 times his salary (he was a teacher and earned 1,300 p.a. I was a civil servant on 1,400) the largest mortgage we could have was c.4k. We moved north - and I gave up my civil service job to teach (bad move) - and we were able to buy a house for just over 6k in the Midlands. That was a mortgage of £65 a month out of a salary of c. £120 a month, which was a good wage. We got tax relief on the mortgage, which was a help, but it was really hard and I did supply teaching to make ends meet, worked in a shop as well, and did lots of part-time jobs - we were in a massive recession at the time and jobs were thin on the ground, and I did not drive, nor did we have a telephone (there was a long waiting list). So there were opportunities for some but most people just had jobs. Opportunities now are much wider and life is incredibly richer for most people. My son goes skiing, my daughter's in-laws have a boat, my step-son goes on holiday three times a year (I think, it might be more). Such things were pipe dreams in the seventies - package holidays were just getting off the ground - and skiing was for the uber-rich. Every generation struggles and always has, and look at the previous generation and complain that they had it easy.

NB If your father had an apprenticeship then he must have been a skilled tradesman, not a labourer. Apprenticeships were difficult to get and required that the young man involved understood he would be on short commons until he qualified c,6/7 years), but then he would be on good money with prospects of promotion and indeed setting up in business.

And property was not cheap. The first house I looked at in 1974 was 8k (a three-bed terrace with a small garden in Basingstoke).

8k in 1974 is the equivalent of 73k now, does that buy a 3 bed in Basingstoke?

This is done up quite a bit £399k 3 bed terraced basingstoke https://www.rightmove.co.uk/properties/142902251#/?channel=RES_BUY

The compkarison I often do is our first house in outer London - again 3 bed terraced cost about £42k (130k in today's money ) and today they cost about £450k, but the jobs we were head of dept teacher and lawyer in London have gone up enough to buy the same house given the differences in interest rates. That is just one example however. I suppose if it shows nothing else the advice in our family when my grandfather's brother became a solicitor in the 1890s is pick high paid professional work. Worked then and works now.

I'd say East Cornwall was poorer in the 80s, defo not the late 90s.

Its one bug bear i have with our tourist economy, more tourism hasn't helped most locals at all, as you say, house prices have boomed as have rents in recent years, in our village any new rental property will be a min of 800pw (ex council house turned into 2x 2bed flats)

So many turned into AirBnB or tenants kicked out, sold and then another AirBnB, needs to be retrospective restrictions, we ve gone from maybe 3 or 4 B&Bs to literally dozens of holiday lets.

My dad did an apprenticeship as an electrician, then gave up "his trade" to work in a factory, then he ran his own business (gardening - he was a labourer all his life despite also being the boss).

When you say "My son goes skiing, my daughter's in-laws have a boat, my step-son goes on holiday three times a year (I think, it might be more). Such things were pipe dreams in the seventies - package holidays were just getting off the ground - and skiing was for the uber-rich." Is it possible that they do these things in part because they can never buy a house so they might as well enjoy life, whereas if they had more opportunity they would choose to do less and buy a house instead?

The statistics don't support this at least from 1981 onwards (when I could find the ONS figs from) - in 1981 circa 62% of 25-34 yr olds were owner-occupiers, now it's 41% in the same age group. So no, young people do not have a greater chance of owning their own home. Also car ownership amongst the young also seems to be declining - massive insurance premiums are probably the main deterrent for that! in other aspects life has improved - but the basics of having a suitably sized roof over your head has become an increasingly scarce resource for younger generation.

You can't do that with money. What that particular house in Basingstoke now costs is the equivalent of 8k in 1974, because the only equivalence you can have is what you can buy with your money at the time. For example I can buy a middle-priced TV in Currys for about £269 (just looked it up) which is a bit under half a week's wages in Oct 23 (average is £620 according to UK government figures), so the the TV is relatively cheap. In 1956 my father bought a TV (it was an Echo, I think) and it cost £60. But £60 is not the equivalent of the price of the TV I could now buy in Currys. £60 is not a bit less than half of the weekly wage in 1956 it is six weeks' wages, a good wage being in the region of £10 a week. My father earned less than that and took out an HP agreement over a couple of years to pay for the TV. Thus 8k for a house in Basingstoke is not 73k now. It is a multiple of the average income. It was 8x more than my ex-DH earned in a year. My son has recently bought a house in a small conservation area village in Leicestershire. It was £190k, which is (I think, not quite sure what he earns) roughly 3x his annual income. The equivalent of 8k in Basingstoke in 1974 is 264k, (8 x of 33k pa, roughly average wage, which is about what my ex-DH would be earning as a newly qualified teacher now according to NEU tables), not 73k. Expensive and still unaffordable (and Basingstoke may be a bit dearer, too).

Yes you can or you can just look at salaries vs house prices & how they have changed over the decades. But it's like shouting into a void, I mean you actually believe this "Young people now have a much greater chance of owning their own house" 😆😆

If you mean my children, all own their own houses, all with 3 to five bedrooms and with gardens. So, no they are not enjoying life because they can never own a property, they are doing both. But when they started out, they saved and went on cheap holidays (son even saved 'Sun' holiday tokens). They all bought houses in their early twenties to early thirties, in the case of daughter and son at the peak of the housing price rises, step-son just missed that, so was luckier.

No, I don't mean young people have a much greater chance of owning a house, nor did I say that. I said that the problems young people have today are the same as I had when I was young. I bought my first house when I was twenty-five, but my then DH was thirty-five at that time and it was his first house, too. My daughter bought her first house in her mid-twenties, ditto my son, and my step-son. I pointed out that 8k is not the equivalent of 74k now, but of something like 264k, both about 8x the salary of a newly qualified teacher and I did this through analogy with the price of a TV, showing how the TV that now costs £269 is something like six times cheaper than one costing £60 in 1956. You compare what wages now buy with what the equivalent wage bought in whatever years you are comparing. It's not exact, because some things were relatively cheaper and some things relatively dearer at different times. But 8x your salary for a house is not cheap at any time.

"But 8x your salary for a house is not cheap at any time."

Not really is it? And you have to add the debt payments on top of this, making it an even more bonkers price. Not surprised that people have just stopped buying houses now TBH.