Home Ownership at Lowest Level for 30 Years

westernpromise

So why do they expect to buy when they are poor, part-time, overspending and could never have afforded to buy in the past?

ruperts

Herzlos wrote: »

By old student loan system you mean pre-98 mortgage style?

Whilst this make people recoil in horror, assuming young enough I think reducing the pension payments in the short term would help. They'd still be a long way away from retiring so dropping to 2.5% each would free up a reasonable amount of cash. I'm aware that you want to put as much into a pension as early as possible, and how compound interest works, but I'd view getting on the property ladder as a priority (you'll need less pension if you're not still paying off a mortgage as a pensioner).



I guess, but lots of people survive pretty comfortably renting.


My broadband is £26/month for unlimited data and phone usage, so I'm sure there's scope to trim it down there a bit, especially if you're in a cable area and don't need line rental. (You could go full MSE and pay your neighbours £10/month to share their wifi).

You can get phone contracts from about £10/month with basic smart phones from about £50 (new, can get cheaper 2nd hand). PAYG is still a thing even if it's seen as uncool, and you don't use it that much.



Off-peak gym memberships should run you to less than £20/month, even something like badminton or 5-a-sides should be costing you less than £5/session.



£20 in most coffee shops would cover at least a cake and 3 coffees. If you're spending that long in there, why not suggest going to a park/museum or something, or socialize in one of your homes.



Why is a holiday a requirement? Why not spend the time on a staycation, and go on day trips to nearish cities?

I understand the point about needing to maintain some quality of life whilst spending years saving a deposit, but a little bit of effort should allow you to trim outgoings by at least 30% in the above examples. Even more if you're bargain hunting, cooking all your own food etc, which should be easy enough if one of you is only working part time.

Another point to note; owning a house isn't cheap. If you're worried about the cost of saving a deposit @ £4/month leeway, you're really going to hurt when you need to repair or replace something. It'd easily cost you £1k to furnish a house (kettles, microwave, bed, sofa, plates), before you get into carpets, wallpaper, boilers and so on.

A reasonable post. There is certainly some scope for making some moderate savings in my budget but I think what it illustrates is that people struggling to save for a deposit aren't necessarily either !!!!less or profligate, and nor do they feel entitled to some extravagant lifestyle. Just living a basic lifestyle like the one I've outlined makes saving the thousands or more likely tens of thousands of pounds required for a deposit a very difficult task, certainly more difficult than it ever has been in the past and if you add anything like an unexpected pregnancy or loss of job into the scenario then it's game over for their hopes of ever owning a home.


Edit - !!!!less is censored? f e c k l e s s

ukcarper

ruperts wrote: »

You missed the part where you had to adjust those figures for age. Our couple aren't in the peak earning age of around 50, they're in their 20's which means the average for their age group is 15% less than the overall average.

what percentile do you want, do you really expect people earning below the median wage with only one working full time to be able to live the lifestyle you describe and be able save for a house.

Herzlos

ruperts wrote: »

My phone budget was for a budget smartphone, not the latest fashionable model. Yes you can save a few pounds per month if you have a simple old style mobile phone and exclude yourself from normal modern methods of communication such as facebook, WhatsApp etc.

Like I said, used smartphone and sim only contract cuts that almost in half.
Facebook/whatsapp can be used over wifi, too, which is available almost everywhere, so you might be a bit slow to respond without 4G.

£70 per month on health and fitness is for two people so that's £35 per month. I don't know if yo've ever been in shape, but it requires persistence and even if you aren't a gym member you still get through a surprising amount of sports gear.

There's plenty of ways to get in shape without a gym membership or expensive gear. I reckon you could get running gear for 2 people in Sports Direct for £70.

Invite your friends round?? Our couple live in a basic one bed flat. I don't know if you've ever been in a basic one bed flat but these are not appropriate for hosting parties. Short of meeting outside on the road in the dark and the rain there needs to be a venue and venues cost money in one way or another.

You have some sympathy here, but again, people manage. A friend of mine has a 1 bed flat and still has 6 or 7 guests over to visit for games nights, it's cozy but doable. I guess it depends on how many people you want to socialize at any point.

Again, it was probably easy to sacrifice a holiday back when it was only taking 6-8 weeks to save for a deposit because you'd just defer it for a short while.

I've never heard of anyone only taking 6-8 weeks to save for a deposit. Every story I've seen on here has been 2-3 years at least.

A £5k deposit over 2 monthly pay cycles means a post-tax income of £30k just to service the savings, so likely double that by the time they pay for everything else.

Curiously, you've got left any budget for stay-in entertainment - hobbies or whatever. I'd go mad if I didn't have anything to do with my free time (not that I have free time)

ruperts

westernpromise wrote: »

So why do they expect to buy when they are poor, part-time, overspending and could never have afforded to buy in the past?

They're not poor, they're average earners out of those employed which puts them in the top 40% of everyone. They're not overspending they're living a very simple, no-frills life.

ukcarper

ruperts wrote: »

The couple earn a combined £28k which is a very generous figure for one full time and one part time worker. Many couples who both work full time are on a combined £28k-ish. They don't want all the niceties, just the bare minimum in terms of social life and health related activities to ensure they stay both mentally and physically healthy.

if you are on minimum wage you earn £14k so every couple who are both working full time earn that.

Herzlos

ruperts wrote: »

nor do they feel entitled to some extravagant lifestyle. Just living a basic lifestyle like the one I've outlined makes saving the thousands or more likely tens of thousands of pounds required for a deposit a very difficult task, certainly more difficult than it ever has been in the past.

A lot of people would regard what you've listed as an extravagent lifestyle. Including lots of home owners.

ruperts

Herzlos wrote: »

A lot of people would regard what you've listed as an extravagent lifestyle. Including lots of home owners.

Average household expenditure in 2014 was over £2,300 per month according to ONS* so I can't see how spending over 10% less than average would meet any definition of extravagant.


https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/compendium/familyspending/2015/chapter1overview

economic

ruperts wrote: »

Average household expenditure in 2014 was over £2,300 per month according to ONS* so I can't see how spending over 10% less than average would meet any definition of extravagant.


https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/compendium/familyspending/2015/chapter1overview

that's the mean right? its not a fair representation. you should look at the median.

Herzlos

ruperts wrote: »

They're not poor, they're average earners out of those employed which puts them in the top 40% of everyone. They're not overspending they're living a very simple, no-frills life.

Well technically they are only 0.75 of average earnings, due to working a 1.5 jobs.

Your underlying point remains though - it's hard for average earners in a lot of places being able to afford to buy, but I think you're completely misrepresenting the scale of how hard it is.

If you choose to live more extravagently than a no-frills life, you have to expect it to take a bit longer to save up a deposit.

The Debt-Free-Wannabee forum may be able to help you budget better if you go over there and post a Statement Of Affairs, but they'll give you a harsher version of what you've got here already.

(also, £300 a month is potentially quite a lot for a car, unless you're doing high mileage or have some particular requirements. I pay about that, but I drive one of those poncy crossover things)