Citywire: I want to give my children their house deposits - here's my plan

RenovationMan

I never really understand why parents feel they have to give their children financial support from cradle to grave. I've seen people on the pensions board talk about setting up pensions for their kids and now this for a house deposit.

What ever happened to raising your children well so that they can go and fend for themselves? Mine will get their higher education fully funded and will leave Uni with zero debt. As the eldest is already talking about a medical degree (5 years :eek:), this is not an unsubstantial amount of money. Once they have their own careers, they can afford to save for their own houses and pensions and whatever else they want.

Generali

dopester wrote: »

Personally I think positive HPI has fully topped out where we are now. Heart-attack to the financial system and, without going deep into it, a whole host of deflationary variables pressing down on land/property after the decades of house price inflation. What some people take "as normal HPI growth" some read the result of the last few decades having been the most extreme and persistent inflation in modern history.

It may well be that the price increases from the 1960s have been a repricing representing the fact that home ownership levels have been rising.

I'm not sure how much further levels can rise from here - 70% of people own their home roughly and many of those that do not, although far from all, will be unsuited to home ownership for example students, poor people, temporary residents and people that move frequently.

If anything demand looks set to fall as the population ages and people try either to realise capital to supplement an inadequate pension or people move to retirement and care homes.

ninky_2

RenovationMan wrote: »

I never really understand why parents feel they have to give their children financial support from cradle to grave. I've seen people on the pensions board talk about setting up pensions for their kids and now this for a house deposit.

What ever happened to raising your children well so that they can go and fend for themselves? Mine will get their higher education fully funded and will leave Uni with zero debt. As the eldest is already talking about a medical degree (5 years :eek:), this is not an unsubstantial amount of money. Once they have their own careers, they can afford to save for their own houses and pensions and whatever else they want.

possibly because they want them to be happy and financially secure?

previously we have seen increased opportunities and improved lifestyles with each generation but that trend now seems to have been reversed. the big mistake is to expect that your children will be able to do what you did.

agreed a medical degree is probably one of the remaining routes into a pretty cosy future. but realistically not all children are going to do medical degrees.

my parents helped me financially through uni and helped my sister (who dropped out of education) with a deposit. she definitely has the more comfortable lifestyle now. i just could never hope to earn the amount that early housing equity bought her.

StevieJ

AD9898 wrote: »

I said I wouldn't post but I have say that seriously, anyone believing for a second that the next decades will be like the last 4 are completely and utterly deluded.

What we have seen in the last 2-3 years is merely the beginning of a complete breakdown of most things we have come to know.

People need to get used to the idea that rising expectations that follow the arrow of time are misplaced. If they don't get used to the idea, the idea will be forced on them in the fullness of time.

Equally deluded are those who think they know for sure what the next two decades will hold

silvercar

Given the way the government student loan system works, it is more effective to give the offspring the money to repay the loan as a house deposit. That way they can get a lower interest mortgage and pay off their loan through the tax scheme at very beneficial interest rates.

If house prices weren't so high, it would be possible to encourage your offspring to fend for themselves. Couple with the scarcity of mortgages and the need for high deposits, your offspring may well appreciate the help.

Graham_Devon

Just wondering how many of you got all this help from your parents?

I've never had any help whatsoever, not financially anyway, and only know one person who had his house basically bought for him, and also a bond thing which he got at 21. (He hasn't got a clue about the value of stuff though, which has caused problems in the past and he's about to go bankrupt it seems, he won't admi it, but I don't see a way out of his issues for him apart from bankrupcy).

The rest of us that I know haven't had anything and have just had to get on with it.

I hope I'm not going to offend anyone here, but it seems to me it's those pro HPI who see that their children will have massive problems (stemming from this HPI amongst other things) and are therefore making plans for their children as they know their children won't have a chance if things carry on as they are if they are left on their own?

HAMISH_MCTAVISH

Graham_Devon wrote: »

Just wondering how many of you got all this help from your parents?

I've never had any help whatsoever, not financially anyway, and only know one person who had his house basically bought for him, ?

I would say around 75% of the people I grew up with got either their deposit (or a significant part of it) and even in many cases their first flat as a gift from their parents.

And I would say 100% of the people I know with children are planning to give them a large deposit or buy their first flat for them.

You'd think bears would be happy about all this deposit gifting going on though.

It is after all just redistribution of wealth from the older generations to the younger ones. :cool:

Malcolm.

HAMISH_MCTAVISH wrote: »

I would say around 75% of the people I grew up with got either their deposit (or a significant part of it) and even in many cases their first flat as a gift from their parents.

And I would say 100% of the people I know with children are planning to give them a large deposit or buy their first flat for them.

You'd think bears would be happy about all this deposit gifting going on though.

It is after all just redistribution of wealth from the older generations to the younger ones. :cool:

How does this assist the social mobility of poorer families?

Hint... it doesn't.

HAMISH_MCTAVISH

Malcolm. wrote: »

How does this assist the social mobility of poorer families?

Hint... it doesn't.

Since when was the purpose of an asset market to assist the social mobility of poorer families?

Hint..... Never.

Graham_Devon

HAMISH_MCTAVISH wrote: »

I would say around 75% of the people I grew up with got either their deposit (or a significant part of it) and even in many cases their first flat as a gift from their parents.

And I would say 100% of the people I know with children are planning to give them a large deposit or buy their first flat for them.

You'd think bears would be happy about all this deposit gifting going on though.

It is after all just redistribution of wealth from the older generations to the younger ones. :cool:

Different backgrounds I guess.

I certainly couldn't say that 100% of the people I know are planning to give loads of cash to their kids in terms of a large deposit, or whole flat.

Most of those I know are just getting along in life themselves, making ends meet.

I can only conclude you are surrounded by very affluent people, rather than the average person on the street.