Could you afford to buy property now, if starting over?

[aphen]

Say you were born 15-30 years after you really were and we’re starting out in your grad job. Could you afford to buy, if on the level salary your job paid when you bought first time? If so, where are you?

What do you expect future generations to do?

My first job on qualification as a solicitor 20 years ago paid law society minimum - £10,850 if my memory is correct. So no.

I expect future generations will rent or stay with family for longer.

At the same time, the earning potential in my job compared to what it was 20 years ago, is also far greater.

Our first flat cost £52k in 1990, it recently sold for £265k. in 1990 our joint income was around £30k, and we bought it with a 95% mortgage.

Looking at similar jobs today, I'd expect us to be on at least £50k together, so yes we could just about afford it. The payments are a lot lower in comparison, the mortgage rate was well over 10%.

At one stage the mortgage interest rate was 17%. Compare that with the current rate of 2% - 3%. The main problem I think, would be saving up for a deposit.

Yes. Another solicitor here. Husband was on law society minimum of just over £10k, I was on a more "generous" package of about £14k. We bought for £60k (2 bed mews house) about 15 miles out of Manchester.

The recommended minimum now for a trainee solicitor is just less than £20k so we'd probably have a combined income of about £45k. The same house would cost about £120k now so yes, could still buy the same house with the same jobs etc.

We probably wouldn't have moved up the ladder so quickly or afforded the house we're in now.

The recommended minimum now for a trainee solicitor is just less than £20k so we'd probably have a combined income of about £45k. The same house would cost about £120k now so yes, could still buy the same house with the same jobs etc.

Actually the same applies to me. My old firm pays £21k to trainees now and my then OH's firm pays a bit more so a combined income of circa £44k. So yes we would have been able to afford to buy the house we bought and the mortgage would be an awful lot lower! House is now worth £120k

God no... bought our first family home for 120k in 1988 on the outskirts of Se London, sold for 825k last year.
Wages back then joint 40k, same jobs now would be about 90k

I graduated 17 years ago and couldn’t buy a house then. My salary was £10k and the 3 bed semi I wanted to buy was £70k (7x salary). Nowadays the same job would pay at least £15k and the house costs £90k (6x salary). So it’s actually more affordable than it was before.

Didn't buy till we were 30 as no great hurry due to the late 80s / early 90s property depression. Could still afford the 4 bed detached house we bought then on one of our professional salaries at the same stage as we did then - just as would be higher multiple but lower repayments due to interest rate falls. We are in West Scotland.

We bought at 23/25 years old and yes, we would still be able to today on the salaries we had then.

Sorry and that was 26/27 years ago.

Yes but in a different area to the one I did buy in.

Looking at an inflation calculator my grad salary then is worth about £31k now. I could buy in East Mids easily (where I live now) with that, but not South East where I did buy in 1999.

I bought my first house which I still own for £74k, now worth £240k pretty much straight out of Uni with a deposit mainly from family. I rent it out now and have bought in a different area with DH.

First house was 14k in 1985, house we are in now was £65k in 1997, it’s now probably £250-300k so no, our wages have not gone up enough though the interest rates were much higher.

DS is the about age we were when we bought the £14k one and a lot of single people bought then, he would struggle on his own but it would be just doable if he had 20% deposit, we only had to get 5%deposit

Say you were born 15-30 years after you really were and we’re starting out in your grad job

DS is this to me, 30 years younger, graduated 3 years ago and started saving for his deposit when he first graduated. Now in a position where he is looking for his first home.

Deposit saved 17k, buying a 2 up 2 down in West Yorkshire for around 120k.

He will be buying alone the same as what DH & I bought at 22 together, although he's a couple of years older than we were.

25% deposit was standard right up till the mid 90s.

Probably. I worked 3-4 jobs and saved and saved for a 20% deposit. So main job + pub job, pub cleaning job + night club job + the odd baby sitting job midweek when not working the pub. Any spare time I had I was asleep.

I bought in 1999 in South east, 20% deposit needed and house was 3 x my income after deposit. The bank included tax credits as they were considered income and not a benefit. That's how the government considered them for more than 10 years.

If I was a graduate now in the same area, it is now 6 times income needed plus deposit of 10%. So a couple can buy together but a single person cannot.

Also my income was not the best so a single person on over 45k can buy in my area today, if they have saved a 10% deposit. It is possible for some and easier for couples before children. Much like it has always been.

I'm 37 and cannot afford it.

No, but I couldn't afford it then really (although with hindsight I should have stretched my comfort zone and bought something - luckily I married DH who had a house already!)

Probably. I wasn't picky about the home and location though the first time so we bought an old house that neede lots of work and even had one room with foot wide holes in the floor (could see the bedroom below. It was also in a shotty crime invested neighbourhood with a murder happening on our doorstep. I'm pretty sure that a house like that would still be cheap today.

Just reading someone above saying the repayments would be a lot lower, I'd forgotten the times paying 15% interest were pretty crippling, 3 x salary & if buying with a partner it was 3 x + 1 - ideally 20% + deposit but sometimes 10 would do, and no fixed rates back then!

I think saving for a deposit was more the norm back then, few went on foreign holidays other than to nearby Europe on a package often by coach & ferry (no tunnel), none of this Maldives or Thailand longer haul stuff. Eating out was only for a treat for birthday etc, and pubs didn't serve much in the way of food, and you always took a packed lunch to work, cooked from scratch (very few ready meals), takeaways were cheaper but even so you rarely did. All your furniture was secondhand to start with, you bought a TV a few months in, and you did your own DIY and gardening.

@Ifailed you think your salaries would be not quite twice what they were then. The property is more than 5 times what it was then. But you still think you could have afforded it? How do you come to this conclusion? Also you bought your 5 x cheaper house with a 95% mortgage. You think you would get that on a house 5 x the price on less than twice the income? Your maths is out.

sollyfromsurrey I used the Halifax mortgage calculator, and yes we could have afforded it.

I'm sure we only paid 5% deposit, maybe it was 10%, this was 1985 when prices were going up very slowly though. House prices really started to rise in about 1988 and then dropped in the early 90s and a lot of people lost their homes or were in negative equity with very high interest rates, so maybe a bigger deposit was needed then.

Yes, we bought in 2005. Our mortgage was over £1000 a month.

Zoopla reckons the house has about doubled in price, but that a mortgage on it would cost £700 a month. So even if there was no salary inflation we’d be better off than we were then.