When was the "us and them" split made?

Aye well johndoh you do never know. No one ever tells the whole story .

Learnt that lesson along time ago when my mate always had the best of toys…..When I was old enough I understood why. His parents had split and dad was trying to buy his love. He said he always looked in at my mum and dad and wished he had the family rather than the toys.

Look after you and yours and don’t worry about the others. They wouldn’t worry about you. There’s usually always another side to every story.

Look after you and yours and don’t worry about the others.

To be honest I try not to, but my wife comes home from school drop off quite regularly saying ‘x is doing y’ and it makes me feel like I am not able to provide for my family in the same way others seem to be able to do.

Everyones situation is different, i thought i had missed the boat through variable earnings (self employed) and being single or in relationships that didn’t last long enough to settle. i’m mid 40’s and only bought 2 years ago having been shafted by my bank (having 80k in savings with them but them not lending me a penny for a mortgage)
switched banks and i had to wait another year to buy thus paying more. bought a small flat in SE19 (good area, good street, cheapest property) and had to put down 65k as there was no way i could get a low LTV mortgage being self employed.
now 2 years later its gone up 120k and i’m in a stable relationship and between us we are sitting on 850k of property that we probably owe 360k on. its nuts when i think about it.

but i still think younger people can do it if you put your mind to it and don’t expect to be going out every night and having the latest gadgets etc. i did it with zero help from M&D.

i am surprised how little property has increased in some of the shires mentioned in this thread, i guess this is low wages that a keeping laid on things.

Cougar – Moderator
What if you don’t both earn 20k? What if you’re single?
What if you’re married with a partner who can’t work, 2.4 kids and a spaniel?

That’s the point I was alluding to (badly). Time was, one salary could raise a family. Now we’ve got a situation where both adults have to work in order to keep a roof over their heads whilst maintaining a half decent standard of living.

That’s precisely the aspect which Stoner’s link is missing. The socioeconomic landscape has changed dramatically in the past 30 years. Not all families are geographically close anymore, childcare is common (and very expensive) both parents are likely to work full time.

Also, household income doesn’t tell the whole truth. Earning £60k, you may have been to Uni and thus have loans which reduce your income by over £300pcm, childcare can cost over £1000, utilities are more expensive. the amount you have available for a mortgage (as decided by the bank) will be substantially lower than your 3* combined income.

Just how much income is required to buy a 3 bed house in an okay area in Bristol? You’d need to be earning over £80k, have no dependants, no debt and no life. Rent in Bristol can easily top £1000 for 2, add in utilities, consumables, transport and insurance and you’re over £2500 per month. at £80 you’d be paying over £430 in student loans. You’re left with £1000 per month before you’ve bought anything or done anything. lets assume you can save 85%. it’d be 3 years before you have a deposit…what happens if you’re 30 and are thinking of starting a family? Do you wait? My £380k house has gone up by over £60k in 2 years, so the house you were aiming for, saving for, is now out of reach…If you have kids, your £1000 per month that you were saving isn’t going to be there for long…

interest only mortgage makes sense if it is far cheaper than renting and you are investing the extra elsewhere for greater return

That’s what I did and borrowed as much as I could starting from 1996 which seemed to me to be a good time to buy as were starting to recover from the nightmare of the late 80s/early 90s. Worked out rather well for me, I took risks but mitigated to a degree by having lodgers.

Yup! I really don’t know how, but we do spend quite a lot on clubs etc for our children which really adds up – singing clubs, gymnastics, horse riding, music lessons etc – I guess we are investing in their wellbeing.

Not easy the pursuit of “upper middle class” ….

we are sitting on 850k of property that we probably owe 360k on. its nuts when i think about it.

It’s nuts at a casual glance, TBH. (-:

The wife and I are currently saving like mad to get on the ladder, I’m 27 she’s 2 years my junior, combined income of 55k ish, been renting for 4 years and recently got married so that blew our deposit, so started from zero again this new year. Looking around the 200k price for 3 bed place, around north Norfolk, we are putting away a large amount of cash in savings and we estimate it will take 2 years for the deposit alone.

We are told there are not enough new houses being built, but also that there are lots of empty houses, but perhaps not in the right places, and there seems little central will to alter things to push industry and tech start-ups to base themselves in lower cost areas. But the Market really is not going to sort this out.

I’ve often seen it quoted that there’s over a million houses empty across the whole country, and certainly there seem to me lots of empty space above shops in many towns, space that’s otherwise used as a junk store. Trouble is most of the property owners quote security as the biggest impediment to letting out those spaces; surely though having people living above the shop and others in the area keep it alive and add to security, being able to react quickly to unusual noises or activity at night or weekends.
European cities apparently have a much higher density of occupation within the main shopping areas, this has to be the answer for our cities and towns.

Why the **** did you blow it on a wedding? Serious question

All I know is that house prices are rising faster then I can get a deposit together and have been for the last decade for me.

I know we had the crash that dented prices but it also reduced the amount of money I could borrow so a house was out of reach. Doesn’t help that I’ve been trying to get on the ladder as a single bloke earning £30k a year while based in South Wales. I could afford a place in Mid Wales, out in the sticks somewhere but then there’s no work for me to do to pay for it!

I worked out various permutations with my dad (lifelong accountant so good with figures) last autumn and I’ve never been more than 70% there towards buying something, currently around 40% of the way. The 70% point was just before the crash, the bank then tightened the rules and I was back down to 30%. That affordability stress test hammers you if you’re on one income. I won’t buy a flat as it would be too expensive when you take into account the money you have to pay to management companies on top of your mortgage, a few people in work have been badly burned by that. We both came to the conclusion that I would have to wait for him and mum to pop it before I could afford something.

I have a friend who’s currently looking to buy a house, nowhere near the South East, but a reasonably nice, rural area, lots of retirees, sod all modern amenities, crap broadband etc.

They’re mid thirties, earn around £23k, have a deposit of £40k(ish), and really struggling to get a mortgage on pretty much anything over £150k, which doesn’t get you much round here.

Why the **** did you blow it on a wedding? Serious question

sort of bloke that goes round turning off all the light switches?
1 because we could afford to 2 because we wanted to

The only reason I was able to buy a house was that just before the crash the builders were giving away free deposits. Don’t particularly like the house or the area (although neither are bad) but I’m very glad I did. We now have equity and everything.

Bring on the 50 year mortgage. That’ll make things more affordable.

I remember my younger brother asking me to go in with him on a mortgage for a house in Bucks. Working and renting at the time – mid 90’s – I baulked at the idea of spending a fair percentage of my beer & bird money on a house. What a moron. As mentioned earlier, Aylesbury had a significant increase in average house price over the years and could’ve netted me a tidy deposit on my family home. I grew up there but not a fan of the town versus the rest of Bucks and nearby Bedfordshire, and am often surprised that the prices have grown in-line if not more than other nicer areas.
I’m 40, and had it not been for the good lady her in doors and her motivation and drive to get our own home, I’d still be giving someone £900 a month 8yrs on.
It is doable, getting on the ladder in higher prices areas, but it takes effort and a bit of sacrifice.
Our neighbours rented their property a year ago, for reasons unknown, and the rent is £1200 a month. The young family that rent it must know that if they could get a mortgage, it’s likely to be cheaper pcm.

London prices are starting to slow as demand lessons following people moving to Home Counties/Surrey/Kent etc., seeking more value for money. This is having a knock on effect on housing out this way. Great for me as my house has gained £100k plus the tiny amount I’ve paid off, but bad for as my next step would about £200k more – I could probably afford to move into London in 5yrs time at this rate 😉

Bought our first place in 2000 from my wife grand mother .

and then with a lot of help from family and hard work , we now have a 4 bed semi in north kent with a very affordable mortgage .

next month we are moving to France to a mortgage free house . we are keeping the uk one and going to rent it .

Housing will straighten itself out eventually – just read up on the psychology of speculative bubbles. We’re on historic highs of prices and price to wage ratios only manageable because of historically low interest rates. It’s not sustainable – we’re talking election-losing situation here, affordable housing’s essential to a working economy, it’s not a speculative commodity like tulip bulbs.

All this ‘supply and demand’ guff is just that – the hyper inflation we’ve seen in London/SE the last few years has been billions of foreign money pouring in to prime central London (much of it being laundered) and the locals borrowing themselves to an early grave to try and keep up. 10% a year on house prices when wages are flat is almost entirely excess supply of money into a tight market, not ‘demand’. BTL doesn’t help as it just pushes up prices and takes supply out of the market (as well as increasing the risk of a bust when prices fall)

Osborne massively screwed up with HTB – and once he realised this he was too late with his stamp duty, killing BTL and other limits to the flood of cash, hence London is now unaffordable and the bubble’s pushed out to the wider SE and even Bristol, Milton Keynes etc – the Tories need mass home ownership if they want to stay in power and the trend’s in the wrong direction for them now.

As mentioned above – the banks are in a better position now to allow a fall, they were stress tested to a 35% crash – although in London that would only take us back to where prices were 3-4 years ago… Prime London’s 12% down YOY so it could have started already.

Those on the ‘winning’ side are being duped into thinking they’re rich whilst those of us who’re not are either facing retirement in poverty, paying rent out of our pensions or massive debt to pay a mortgage and lower living standards for life – it’s very divisive and massively reducing the amount of cash people have to spend in the real economy, providing jobs and wider economic activity.

London’s losing out too – a lot of people leaving – even employers are complaining they can’t afford to pay people what they need to live there – and knackering the most economically productive part of the UK isn’t sensible. My cycling club’s beginning to lose members too – it’s impacting communities as well.

2017 will be interesting – Chinese money is slowing up, foreign buyers are renting to avoid stamp duty, 30 somethings are leaving London, Foxtons shares are dying fast (400p in 2014 to less than 100p now), BTLers are selling up before tax rules change in April, thousands of overpriced luxury flats coming onto the market and not selling, consumer confidence falling and the risk of the City losing its status because of Brexit…

The attitudes of the ‘haves’ is pretty unpleasant to watch as they blame the younger generation for ‘spending all your money on phones’ and totally ignore the fact its the actions of government, BoE, banks, builders, councils and existing homeowners that have created the crisis.

Sadly, the badly needed correction will do huge amount of damage to those who’ve failed to save or build a pension pot, assuming they could cash in their equity at a time of their choosing…

we are keeping the uk one and going to rent it .

And there you have one of the causes of the crisis. You know we have a major housing crisis in the UK – why don’t you sell it to someone who wants somewhere secure to bring their kids up?

http://www.economicshelp.org/wp-content/uploads/2014/12/house-price-to-earnings-ratio-600×536.png
My opinions…
It comes down to a few factors
The end of jobs for life, mobility is a much bigger thing these days, as somebody posted above you can’t always get a job and be able to live at home for x years.
From 97 things started to rise, that was the boom that lifted so many but in the end snapped. As another posted last of the 100/110% mortgages.
Sometime around 08 a straight faced IFA said the best course of action would be to take the highest LTV mortgage available on interest only as within 2 years the property would have grown enough in value to get a 25% deposit out of the equity….. There was some seriously bad advice going on that was all based on a rising market.

The other stuff – millenials splashing the cash on fancy food etc.
A lot of the people posting will have had a free education, grants at uni and much more. Average debt for a student leaving uni is huge these days which isn’t going to help anyone. In plenty of cases ideal first homes will be subject to stamp duty and more.

The money that you “make” in the property market pyramid scheme (becasue it currently is one) is only released when you downsize at the end. In order for that to happen you need people moving up the ladder or at least getting onto it.

For this good jobs and affordable housing need to be closer together, mobility needs to be addessed (one of the factors leading to a lot of single property landlords) and a few more things.

It comes down to a national need/strategy really where planning, transport, regulation, banking and many other things need to be aligned in order to make a future where the split is healed.

why don’t you sell it to someone who wants somewhere secure to bring their kids up?

Why should they? Maybe it’s to be sold when juniors need a deposit? Or for care in old/age pension (not everyone has a conventional pension(I don’t)) or maybe they just don’t want to convert a fixed asset into cash.

Agree with this, I’m 36 and amongst friends it depends on whether life circumstances (e.g. met partner) were right round about 2001

Same here, I’m 5 years older than you but was the last to settle down, everyone found someone in the early naughties and hasn’t moved since, I the few 3 or 4 extra years it took me to settle down was the difference between near the bottom and near the top of the boom. Consequently my mortgage is twice than any of there’s despite living in a smaller house there’s. And yet I’m lucky, my parents lent me the deposit and I paid it back within 2 years due to house price rises. I genuinely feel for those under 30, they have a rubbish deal and I’m not sure what’s going to change that.

Yeah, Oxfords actually harder to find a nice place for semi sane money than Zone 1 in London.

I genuinely feel for those under 30, they have a rubbish deal and I’m not sure what’s going to change that.

Move somewhere/invest in property somewhere with high growth and cheap houses – eg Asia.

Why should they?

Because – the wider community and economy can’t afford it.

1. High housing costs killing the real economy
2. High debts reducing living standards
3. Forcing younger generation into lifetime of debt
4. Increasing homelessness
5. Couples not having families because they can’t afford property big enough for kids, or having kids late and suffering the complications…
6. Massively long commutes from living miles from work = less sleep, more stress and depression, lower productivity
7. Both parents being forced to work and not being able to have one parent at home looking after the kids
8. Mental health issues in the young on the increase
9. Increased inequality
10. Setting ourselves up for another massive debt-driven bust when we’re still on our knees from the last one.
11. Communities being torn apart as people have to leave where they live to go somewhere more affordable
12. London/SE struggling to find teachers/police etc as no-one on those wages can live there anymore

… need I go on? There’s more than your own pension provision/family needs at stake here, or does wider society just not matter in the UK now?

5. Couples not having families because they can’t afford property big enough for kids, or having kids late and suffering the complications…

That is a drain on the economy in of itself…as it’s uncontrolled population decline, instead of sustainable decline that allows us to look after the old without resorting to ridiculously high tax rates.

10. Setting ourselves up for another massive debt-driven bust when we’re still on our knees from the last one.

As the pressure and advice from our betters is that Property is a great investment etc. buy buy buy in damm you. Spend nothing and live on own brand beans for 5 years to get the chance to try and buy somewhere that isn’t going to end.

Anyway just wait till the crop of shoddy pre fabs etc. are in a state where they are not worth buying that will be the next shock to the system.

a couple of points that don’t always seem to get mentioned – most under 30’s these days are still paying student loans and anyone under 24 now is likely to be paying that 9% until they’re 51 (i know i keep banging on about this but still) – it makes it that much harder.

and 2 – the high interest rates of the 80’s. The flipside was that debts inflated away pretty quick. My folks bought a house in 1980 for £10K, or about 3 years of dad’s wage. Soon there was a period where the mortgage payments were about 100% of his take home – scary times – but they held it down and in a few years the balance on the mortgage was a few months of his wage, the house was worth 30K, and the mortgage payments were sod all, relatively speaking.

So on one hand the people buying houses now (hello) benefit from low interest rates, but on the other hand, zero inflation means that the mortgage payments will still be significant 10 years down the line.

or does wider society just not matter in the UK now?

It does, but why should those that saved and worked hard have a mass sell-off of assets to flood the market and suit those waiting in the wings?
The current owners could be seen as victims too.
Change will have to come from policy and the current government isn’t going solve the problem.

I’ll not want to sell my flat when I move in with the other half as we will want to use it for our retirement plus I don’t want the cash liquidating it would release right now. What would you do? Have 160k in the bank earning 1% or somebody paying your mortgage off plus £300 a month? I never wanted to become a landlord, I’m not interested in having a BTL empire, I just don’t want to sell my flat.

STU170 I do go round switching the lights off, I also have a house that’s paid for and my two eldest in their mid 20s also have their own houses (with mortgages obviously) – incidentally neither have needed help from me (they saved up) – I suppose my approach would be to buy a house then save for a wedding – call me old fashioned… anyway off to turn some lights off.

MrSmith – Member

It does, but why should those that saved and worked hard have a mass sell-off of assets to flood the market and suit those waiting in the wings?

Because those waiting in the wings are also saving and working hard. In many cases, harder. And while current homeowners have earned their homes, what they haven’t earned is the huge price rises.

When you stop and think about it for a moment, the entire concept of property as an asset appreciating faster than inflation and wages is fundamentally unsustainable. The only question is how and when it stops.

It does, but why should those that saved and worked hard have a mass sell-off of assets to flood the market and suit those waiting in the wings?

If the public benefit outweighs individual benefit, yes. Besides, unless they are investment properties, most peoples house prices will devalue at the same rate as everyone elses – your purchasing power stays the same. There would just have to be a plan and a budget put in place for those who’s hourse prices dip below what they have left to pay on their mortgage.

My first house in 1986 was £33k ish I needed a 10% deposit (about eight months wages) interest rates were 10% and my tax allowance was about £600 a year – take home pay was about £100 quid a week. Hardly a doodle then interest rose to 12% , I think I payed about half my wages in mortgage.

incidentally neither have needed help from me (they saved up)

How did they pay their rent while they were saving? Genuinely interested.

By sharing houses and living frugally and working their backsides off in good jobs

And always having part time jobs at uni

I’ll not want to sell my flat when I move in with the other half as we will want to use it for our retirement plus I don’t want the cash liquidating it would release right now. What would you do? Have 160k in the bank earning 1% or somebody paying your mortgage off plus £300 a month? I never wanted to become a landlord, I’m not interested in having a BTL empire, I just don’t want to sell my flat.

And here is the problem, their is both nothing to make you or incentivise you to. My mum still has my grandmothers house rented out as it was a better way to handle it when she died, it’s money that is sat there now worth 5x what she paid for it.

The government up until this point have done the safe thing as the cost of a price correction was considered too much politically. What comes next is anybodies guess but will depend which voters are needing to be pleased. (removing tax savings from ivestment property wold be an interesting tool)

What would you do? Have 160k in the bank earning 1% or somebody paying your mortgage off plus £300 a month?

LOL 1% a month in a bank, those kinds of banks are for the clueless. You can invest with pretty low risk and make 5 percent average yearly returns. Top investment managers will net you 15 percent average yearly returns – there is absolutely no need to hog houses to make good money.

**** me, I’d be laughing if I had 160k to put in a fund.

By sharing houses and living frugally and working their backsides off in good jobs

Fair enough. Respect to them.

Even the shared house market is stupid these days. I don’t know what’s changed but you used to be able to just rent a family house for say £500 and have a few of you living there and just split the rent. Now it’s like the landlords have worked out that 3x bedrooms, plus living room (extra bedroom), plus cellar (bedroom), plus space under the stairs (single bedroom) = 6 rooms. 5 couples plus one single = 11 tenants x maximum housing benefit = 1 BILLION DOLLARS

When you stop and think about it for a moment, the entire concept of property as an asset appreciating faster than inflation and wages is fundamentally unsustainable. The only question is how and when it stops.

I’m fully aware of the house price crash graph, I have posted it here often enough! And if/when it comes I’m reasonably protected with 50% LTV and low income multiple. It’s those sailing close to the wind leveraged to the max who might get a kick in the nuts. I just wanted a small 1 bed flat to own that was cheaper to buy not rent just like lots of other people.

brooess – Member
we are keeping the uk one and going to rent it .
And there you have one of the causes of the crisis. You know we have a major housing crisis in the UK – why don’t you sell it to someone who wants somewhere secure to bring their kids up?

I don’t think it’s fair to single him out on this. The ‘wider society’ doesn’t mean anything as far as I can see. People might pretend it does, but like recycling – it’s just virtue-signalling. They’d probably burn it if no one was looking.

Everyone seems to be out for themselves, and I’m sure it’s not just the UK either. Even people I love and respect can come across like Victorian mill owners when they start rubbing their hands together at the prospect of making money out of property.