Why now so hard to get that 1st rung on the propery ladder compared to years gone by?

SammyLee

Daft question time, can anyone please shed some light on why it's now so hard for a first time buyer to put their foot on the property ladder compared to times gone by? What factors are causing this? I'm sure our Parents didn't have the same problem and the only sense I can get out of Estate Agents when I ask them is that there are so many First time buyers on the market but why should that be?
Yours confused

BobProperty

Because:
1. Prices are at a historic high.
2. The current generation are driven by an instant "want it now" culture.
3. Combined with 2 they think they "deserve" to be able to buy a 4 bed detached house in Alderley Edge as their first step on the property ladder.

In order to fit in with 2, lenders will lend at ridiculous income multiples to allow 3 while ignoring 1.

The other side of the coin is:
1. Their parents had to save for years for a deposit.
2. The lenders only lent 2.5 to 3 times earnings on repayment mortgages.

Ems*Honie

I think Bobs entirely right I dont think its 'harder' just that we now have differant expectations.

Jim_B_3

It is much harder. House prices have gone up much faster than wages, so they are much less affordable, thus people have to save up for longer to get a deposit together, and the mortgage term is much longer. I grow so sick of hearing smug !!!!!! say that people could buy a house if they didn't buy iPods. How many people do you see buying 150000 pounds' worth of iPods?

The average age of the first time buyer has gone up, doofus. Does that sound like instant gratification?

lynzpower

Every man and his dog these days all seem to go to uni. In my year at 6th form only one person in the whoe year of a few hundred did not go or secure a place for the following intake. I came out with about 10k debt, but most these days will come out with more as they have to pay fees, so say min 15k. Having this sort of debt is difficult to buy houses earlier. Its impossible for many to save for a deposit, but also 100% mortgages, 125% mortgages, IO mortgages are normal, when they werent before, giving those among us ( yes me included) the ability to have something they cant afford, thus pushing the prices up across the board.

I think the telly has got quite a lot to do with it as well, property prices and development is the now riches of the common man. Everyone should have more property, if daytime TV is to be believed. Im an avid watcher of homes under the hammer & I lose track how many times Ive seen -theyve done the place up going the property is valued at 5k more than before . Woooooooooooo hoooooooooo, you will have to pay that in sol fees and EA fees and the like, you will have been lucky to break even there. But there seems to be no shortage of people trying to jump on this train, as TV will testify. Property ladder, selling houses, house doctor, location, homes under the hammer, getting on the property ladder, place inthe sun, move to the country - off the top of my head these are all programmes on at the moment, have been running for a while, and the theme of all of them - how much you can MAKE on property, not wht a lovely place they are to live. How many times have you watched these programmes to find "this one is 26k over budget, but we think its worth it" ( kirsty usually to blame on that one) and the outcome, viewers thik nothing of overstretching themselves, so they do.

Look how many people talk of thier homes as "investments" this never happened 5 years ago to my mind, now it is the norm.

Just a few thoughts

[Deleted User]

You try being a FTBer in London if you want hard. House prices here are crazy. I just started the process and my first home is gonna cost a whopping 200k.

The world has changed a lot since my parents got married and set up a home 30 years ago. It is tougher, but often through people's own making.

* People get married later, and really it takes 2 to buy a house.
* People take on considerably more debt as students (bye bye grants, hello student loan company). Its not unusual to find a graduate with 14k of debt at 21.
* People have higher expectations on consumer goods - its not common to walk into a student house and find more goodies than in Dixons

The average age of the first time buyer has gone up in response to the rise in house prices Vs wages, I feel very fortunate to be able to buy a house at 26, but its not fell out the sky, I've worked extra jobs, sacrificed not having a car and not had holidays to get my deposit money together. This was because my major focus when starting work 3 1/2 years ago was to buy a house.

It is do-able, you just have to work for it

Jim_B_3

ringo_24601 wrote:

* People get married later, and really it takes 2 to buy a house.

It does today, but only because most two person households now have two incomes. There was a time when a man with a decent job could afford to buy a house for his (house)wife and family.

It seems that the price of houses expands to cover as much money as people have to spend on them; the decade of cheap credit has served to fan the flames. Still, with any luck the economic crunches on the horizon will take care of that.

Careful_girl

Just as an illustration, I bought my first semi 10 years ago for £45,000. It was a lovely house in a good area.
My parents bout a house in 1979 in a stunning Cotswold village with a big garden 4 beds, double garage, full of character, outbuildings.....for the same price.
I shan't illustrate the grandparents!!
Oh the good old days.
CG.:j

Kaminari_2

I don't think it is any harder. I just think expectations are higher. Instant gratification is on the increased and we do live in an "i want it now" society. I live in London and freely admit anyone on an average wage will find it near impossible to buy however if you want it bad enough you will find some way. I'm on only an average wage but i have been saving and buying houses up north for a while with high returns and good growth. In five years time i intend to remortgage the whole lot to produce a deposit for a property in London.

Jim_B_3

Kaminari wrote:

I don't think it is any harder. I just think expectations are higher. Instant gratification is on the increased and we do live in an "i want it now" society. I live in London and freely admit anyone on an average wage will find it near impossible to buy however if you want it bad enough you will find some way. I'm on only an average wage but i have been saving and buying houses up north for a while with high returns and good growth. In five years time i intend to remortgage the whole lot to produce a deposit for a property in London.

You've just contradicted yourself. You say it isn't any harder, but the previous generation did not have to buy a string of cheap houses in the north in order to put together a deposit for a house in their area. You also happily say it's near impossible to buy; it certainly didn't used to be near impossible.

[Deleted User]

Its a simple thing to decide: How has the average wage V average house price changed?

In the last 4 - 5 years the market has jumped significantly, far out of proportion with wages.

Yes, it's harder to buy a house now. Plus, our pensions are going to suck. And most graduates are in immense debt.

We live in interesting times