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

Malcolm.

HAMISH_MCTAVISH wrote: »

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

Hint..... Never.

A government (alleged) aim is to increase social mobility, and governments influence house (/asset) prices.

Q.E.D.

HAMISH_MCTAVISH

Graham_Devon wrote: »

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

And based on that logic, I can only conclude that you are surrounded by very poor people, rather than the average person on the street.

Neither of us would be right though.....

There has been some interesting research done on the perceptions that people have of the world around them.

I don't remember where I read it, but the theory goes that most people have assumptions that tend to skew their world view.

For example:

Most people tend to be friends with other people of a similar social standing, income range, educational level, etc.

People therefore also tend to make the mistake of assuming most people are like themselves, because people of a similar social standing, income range, educational level are who they mostly surround themselves with.

Most people are therefore almost always wrong in their perception of what the "average" person is, how much wealth they have, etc.

Which is, by the way, why arguing on internet forums is so much fun.

HAMISH_MCTAVISH

Malcolm. wrote: »

A government (alleged) aim is to increase social mobility, and governments influence house (/asset) prices.

Right To Buy is a pretty good example of increasing social mobility through housing, I suppose. But then again, so are 100% mortgages.

If the government was really interested in enabling social mobility through housing, by far the fastest and most comprehensive way for them to do it would be to push for higher LTV ratio's from the banks.

nollag2006

What is perhaps most worrying about this thread is that it is Capital Economics who are claiming that house prices will rise solidly over the mid to long term. Last time the muppets at CE were this bullish was August 2007...

Graham_Devon

HAMISH_MCTAVISH wrote: »

And based on that logic, I can only conclude that you are surrounded by very poor people, rather than the average person on the street.

Neither of us would be right though.....

There has been some interesting research done on the perceptions that people have of the world around them.

I don't remember where I read it, but the theory goes that most people have assumptions that tend to skew their world view.

For example:

Most people tend to be friends with other people of a similar social standing, income range, educational level, etc.

People therefore also tend to make the mistake of assuming most people are like themselves, because people of a similar social standing, income range, educational level are who they mostly surround themselves with.

Most people are therefore almost always wrong in their perception of what the "average" person is, how much wealth they have, etc.

Which is, by the way, why arguing on internet forums is so much fun.

Well I couldn't say very poor people. My peers enjoy what I would call a decent life and are able to fend for themselves.

But you are right, people do tend to hang around with their own social circle. I work with very highly paid people, and normal civvy street people. The civvy people are often astounded with the stuff those taking over 100k a year come out with in innocence when they forget aga installations at 8k are not the norm for most people.

nollag2006

Much better option is to scramble together the deposit and by a BTL now. This has been my own approach.

By the time my own daughters hit their early 20's the mortgages on the flats I bought as BTLs last year will have been almost paid off in full, and we will also be sitting tidy on a very nice capital gain. Up 15% in value since I bought them, which is very nice considering the yield is also almost 6%. I always find it very heartwarming to think that someone else is paying the mortgage for me !!

Once they are old enough to want a home of their own, my daughters will then have the choice to either pay the CGT and move into the flat or sell it and buy something else.

silvercar

I suspect its dependent on age. If you have bought and you see the difficulty that FTBs have in raising deposits and affordability now, you are more likely to want to help your children. On the other hand if you yourself are finding difficulty buying the idea of helping your children out is beyond a dream.

neverdespairgirl

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, and also a bond thing which he got at 21. ?

I got a lot of help from mine. They paid for me (and my 3 siblings) to have a very good education. They bought me an elderly ford escort when I was 18, and a 5 year old Astra 2 years later, when my sister inherited the ford. They supported me at university, and paid my bar schools fees (which were £7,200 in 2000). They also gave me some support when I was doing pupillage.

They did not offer, I did not ask for, and I would never expect, money for a house deposit.

neverdespairgirl

RenovationMan wrote: »

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. Once they have their own careers, they can afford to save for their own houses and pensions and whatever else they want.

Sounds good to me.

Of course, in an emergency or crisis, I'd always help my children.

neverdespairgirl

Generali wrote: »

I knew a bloke who owned a 2 bed flat when we were at uni. It was great for him because it meant that he could rent out the other room for an income.

Did he want to stay in the same place as the uni, though, afterwards?