Lack of affordable homes for the 'squeezed' middle

[mymiddleissqueezed]

A moan so please feel free to scroll by! I’m feeling so down and deflated about our housing situation. I earn £52k, my partner is getting a business off the ground and so only pays himself circa 10k at the moment. We are in our 40's and still rent privately (not through choice); currently we are covering our outgoings and saving a small amount each month towards a deposit by living pretty frugally. We live in a very expensive part of the country (not London). What we can afford on the open market would be a small 1 bed flat which is unsuitable as we both work at home. We can't move ares due to job, business and family. We have been looking in to shared ownership as a potential solution. The SO properties that come up around here are usually a fairly high percentage (40%/45%) for homes valued at around £480k. Have spoken with a broker who has said we don’t meet affordability for the SO properties. I despair at the thought that even schemes to make homes affordable are not affordable to us, and we will be stuck private renting and working until we die. I'm on a couple of shared ownership facebook pages; I honestly don’t begrudge anyone anything, but get very downhearted when I see people on much lower salaries than me and/or on benefits having success with this scheme (not bashing anyone on benefits btw, but the scheme in general). Very much feeling like the ‘squeezed middle’. ☹.

Yes they have their uses but I have heard too many horror stories, including difficult to sell, particularly if they are within a social housing context as the housing provider often has the first say over who would meet the criteria for purchase.

@PattyDukeAstin yes. What is your point? I do feel it unfair that a scheme designed to help anyone earning under a certain threshold seems easier for people on benefits to access. I don't blame that on the people receiving benefits though, I blame the way the scheme is set up.

@soupyspoon I'm not turning my nose up at other parts of the country at all. It simply isn't viable for us due to elderly parents who are very reliant on me, as well as my job and my husbands business. If it weren't for these factors I'd move tomorrow to buy an adequate home.

You want it all on your terms, so of course it’s unfair. That’s life! 🤷🏻‍♀️

We moved abroad in our late 40’s to be able to afford something cheaper/better, but accepted that this means leaving family members behind and only seeing them annually at most.

It’s called compromise.

@fuckity yes, if you call 'my terms' retaining my extremely stable job that is keeping us afloat and caring for my elderly parents who without my help would be putting a large burden on the social care system.

@FuckityFux genuinely glad you found a way to make it work for you though, sounds great 😊

OP you should buy in a cheaper area of the country where you can get something on your salary alone and rent it out to pay off the mortgage while you pay your own rent. Appreciate there are perils of being a landlord but you can mitigate these in various ways and you would end up with an asset, the equity in which you can eventually use to buy in your more expensive area. Or - and this sounds horrifically morbid - will you have more freedom to move area (and possibly more money from inheritance) once your parents are no longer with us? If so perhaps keep saving with that in mind.

How are people on benefits benefiting from the scheme more than you? Are they able to buy a smaller percentage than you have to?

Can you purchase home help as a care package. Thats what Im trying to get my parents to do, but they dont want anyone in the home unfortunately

Buy the 1 bed flat. One of you works in living area and other in bedroom.
Or buy elsewhere and rent out.
Seems a shame you didn't buy when your husband was in employment? Was there a reason you put it off.
Unfortunately you can't live in a super expensive area, have low paid jobs and buy a large property it just isn't going to work.
Do you have savings for a deposit?
How long has the business been going?

If your DH's business is a good idea then in 2 years time he will be bringing in a lot more than 10k and you will be able to buy, and in 4 years time he'll be bringing in so much that it would be quite offensive if you were actually benefitting from a SO scheme at that point. SO schemes exist for people who won't ever have the capacity to take on a full mortgage, not people who are on a stepping stone to get there. If in 2 years time the situation hasn't improved then DHs business should be demoted to "hobby" and he can get a proper job.

I think there are a lack of affordable homes for everyone. It's not unreasonable to feel disappointed that on a reasonable salary, you'll be lucky to buy a 1 bedroom flat. It shouldn't be like that.

Unfortunately, this is a case of priorities. If you want to be able to buy soon-ish, then you need to find a way to increase your income. Your DH needs to get a full-time paid job and set up his business on the side. You could look for a second evening or weekend job. If you and he aren't willing/able to do this, then your options are:

• wait until your parents pass away and then move
• discuss whether your parents would be willing and able to move with you to a cheaper area
• buy the one bedroom flat and just work around the space issue (you can each take a couple of hours each day working from the library or a coffee shop for example, so you're not under each other's feet)

I'd also talk with your other half about a deadline by which the business will be viable and he'll be able to pay himself a decent salary. If this point approaches and it's still not viable, then something will need to change i.e. he'll need to get a paying job elsewhere.

If your husband ‘used to earn loads’ why didn’t you buy then? Why now?

It's just a compromise. You've already explained you can't leave your area but the only way we could buy was to go to a satellite town of Dublin (we're in Ireland) to get a much cheaper price. Houses in Dublin start from half a million whereas we bought one hour away for half that price. It's meant consequences such as me being an hour's drive from work and my elderly father. I can't socialise with people from work as a result. The upside is we have a four bed house in a mature estate that we got for 240000 euro. It's all doable but you have to make sacrifices.

What is the point of this question though? They didnt and havent so they have to try to make the best of what their circumstances are now

My view would be, get a care package for the parents, move to somewhere easily transportable by train (quicker than car hopefully) so you can visit at weekends and move to where property is affordable, there are lots of affordable areas of the country

It’s really frustrating how expensive property is and I do empathise, but some of it is life choices also? Being in your 40s with no deposit or equity (that you’ve mentioned?), you’ll now be more restricted by your ages and mortgage length, your DH is essentially starting all over again, yes £52k is above average but as a salary essentially sustaining 2 people in an expensive area it’s not a shed load? Hopefully your DH’s business will take off for you to get on the ladder soon, otherwise, something else might have to give if property ownership is on to run agenda, that will likely have to be location and/or your DH’s earnings.

Ultimately, it was a very self indulgent path to give up a high paying career to start a business, you have to be in it to win it I guess (I’m way too risk averse for that!) but in the meantime, you’re in the thick of it.

I forgot to say, OP, another option is to buy a property in another area that you don't plan to live in, but rent it out as added income. Again, it's not ideal for everyone, but it may be an option to consider.

Move somewhere cheaper?

How come you have you reached this stage without getting on the property ladder, it must be hard to be a first time buyer in your 40s.

Me and dp earn less than £60k between us, we're younger than you and have 2 children and will have paid off our mortgage within the next 7-10yrs (depending on how much we overpay). We've had no family support. But the difference being we live in a much cheaper area. That's the trade off.

There must be something you’re omitting.

youre 40s and renting.

and your husband used to earn ‘shed loads’ more than you (I think you said) and you earn 50k.

what decisions have you made in the past that have resulted in this situation.

you seem dead set on blaming the scheme and the government and benefits etc, but from what you’ve told us here, via not telling us how you’ve ended up here, seems all of your own making.

@mymiddleissqueezed I’m afraid you haven’t worked hard all your lives. You are part of the way through and your DH has DH has decided to start a, so far, not very profitable business. He needs decent earnings and 3 years books. Your choices regarding work have made a huge difference and you won’t move into a different area. Lots of people do move but you are saying family means more than a house because you work dri
home.

I think your DHs position, is causing the biggest problem and I would want to know when his earnings will improve or it’s completely jeopardizing your future choices. My DH was self employed but always earnt more than his employed status from day 1. We already had a mortgage and it mattered that he did. Your DH has a different view and I don’t see how this is the fault of anyone but him.

I think this is what l was trying to say.

My ds is self employed. He had to show 3 years books to gain a mortgage. However, this was because he was earning a decent amount. A lower amount would need to show 5 years books before getting a mortgage.

You and your Dh need to look at ways to increase his earning rather than choosing self employment.

I hear you! Never thought I’d still be living in my 2bed flat 15 years later, but the “next step” on the property ladder is at least another £200k more and in need of renovation and more than I can afford despite earning what appears on paper to be a very good salary.

I think in addition parents have to accept help from others via social care or pay for it. Many people need to work to buy a property and parents really ought to understand this. Most areas that are expensive do have some chewier areas not that far away. It’s a case of managing expectations, ensuring parents do have alternative help and getting DH earning decent money. So many times people think having a business is fun but it’s often at the expense of so much else. Great if you can afford it, but you cannot.

If you’re in your 40s then it’ll be a reflection of a number of decisions you’ve made over the years. Dh and I deliberately chose to move to a cheaper area, bought a tiny starter home and had no spare money for treats for the first 2 years of marriage (shared one car) to get on the housing ladder. That built up enough equity to pay for a deposit for a 3 bed terraced family home where we started our family. Career progression then meant we could take the next step to a 4 bed detached (3dc so needed more space).

would I have liked to have stayed in the south east? Yes, especially London, but we prioritised. It means we’re further from family but we juggle and balance. Choices have consequences. For some home ownership isn’t achievable but on 50k, it is, if you make choices that enable it.

If DH earned £40,000 it’s a game changer.