Home Ownership at Lowest Level for 30 Years

MobileSaver

ruperts wrote: »

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.

I can't believe you don't see how silly you are making yourself look; what you are describing and listing as essential outgoings are not "the bare minimum" by any stretch of the imagination... the sense of entitlement is strong with this one.

andrewf75

The way I see it, the problem is not so much that low earners can’t afford to buy, but the state of the rental sector. I don’t see how it is realistic for everyone to be able to buy a house.

We need more council housing for the worst off and regulation of private rents, then people wouldn’t need to buy a home to have security. Look at say Germany and many people choose to rent their whole life because its cheap and you have long term security. Impose regulations on the market and of course then you also reign in growth in prices as you discourage buy-to-letters. It’s a win win situation all round, except for those who are out for personal gain and not what is best for society.

ukcarper

andrewf75 wrote: »

The way I see it, the problem is not so much that low earners can’t afford to buy, but the state of the rental sector. I don’t see how it is realistic for everyone to be able to buy a house.

We need more council housing for the worst off and regulation of private rents, then people wouldn’t need to buy a home to have security. Look at say Germany and many people choose to rent their whole life because its cheap and you have long term security. Impose regulations on the market and of course then you also reign in growth in prices as you discourage buy-to-letters. It’s a win win situation all round, except for those who are out for personal gain and not what is best for society.

I agree the rental market needs to be improved as it's unrealistic to expect everybody to buy if they want security of tenure.

Not sure how that can be achieve though. I can't see social housing numbers increasing dramatically.

MobileSaver

andrewf75 wrote: »

We need more council housing for the worst off ... It’s a win win situation all round, except for those who are out for personal gain and not what is best for society.

Who is going to pay for all the extra costs of all this council housing? At a guess I'd say the taxpayer, so not quite the win:win situation you describe!

andrewf75

MobileSaver wrote: »

Who is going to pay for all the extra costs of all this council housing? At a guess I'd say the taxpayer, so not quite the win:win situation you describe!

Who pays for the housing benefit for those who can’t afford private rents?

We're paying anyway. Surely more cost effective for the state to own the housing outright rather than effectively subsidising private landlords?

TrickyTree83

ruperts wrote: »

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

There's no way that's a basic lifestyle.

Part of the problem appears to be how people define a "basic lifestyle".

I came home (to parents) from Uni at 21, got a job in a petrol station. Saved for a year and paid off my student debt which was in addition to my student loan and then continued saving for the next 2 years. I built up a deposit of £10k and went house hunting as well as job hunting.

My first house purchase was in Oct 2007 by which time I'd put my degree to use and I was now in an IT job on circa £22k. I purchased a grandma-chic 2 bed semi, listed at £125,000 which had sufficient enough problems and length of time on the market for me to barter them down to £105,000 (I know, they got robbed). But I was on the ladder. No partner, no bank of mum and dad, I was paying my parents rent whilst I was saving for the house so you could say someone in an HMO could do similar.

I furnished it with hand-me-downs and free goods. Stinky crappy sofas, beds, tables and chairs, book cases, etc... and over time gradually replaced them. I put up with the avocado green bath suite for 5 years before I had the money to replace it. During this time I never once had a gym membership, I only ever had a mid-range smartphone and I drove around an MG ZR 1.4 03 plate. I learnt how to do many DIY tasks and made many mistakes whilst doing so. From late 2007 - probably 2011/12 I took no holidays. I didn't go anywhere abroad, the best I could muster was a trip to my cousin in the Peak District, or my grandparents in Somerset which would sometimes involve hitching a ride with my parents.

Socialising involved a couple of pints in the locals and playing squash/badminton at the local leisure centre where we'd share the cost of the court rental. Squash was about £2.50 per person and badminton £1.95 per person.

My broadband was with Talktalk, which gave me a phone line and broadband at a cheap rate, later I'd upgrade to virgin when I had the spare cash. My mobile was always a mid-range smartphone, Sony brand, never exceeding £20 per month, it was a small luxury I allowed myself. I bought a 2nd hand chest freezer and I would go shopping at farmfoods, iceland, etc... and freeze food that was on offer at the time, which was usually close to the sell by date. I didn't eat takeaways and had to learn to cook food properly and plan sensibly for the month ahead. Instead of new appliances I would purchase used appliances from charity shops. My clothing was awful, hardly any of it was new and some of it was tatty but it was all I had, I'd save my branded clothing (even though it was old) for special occasions such as going out or special events.

My situation now is such that I could probably purchase a 2nd home despite living in a 2016 built 4 bed detatched Redrow home that I bought for £315,000. I'm regularly paying £200 per month into a private pension on top of my employer pension and we drive a Kia Sportage KX-3 Nav and my wife since 2012 a Honda Jazz. It's far from impossible, your definition of basic/no-frills is far removed from mine and I suspect this is where your problem is.

I appreciate my example is probably extreme, owning a home but dressing like you're homeless. But it just depends how determined you are to get that first house. If you're ploughing money into gym memberships and expensive smartphone contracts, expensive social occasions and anything which isn't the absolute minimum you can spend whilst not becoming a hermit then you're simply not dedicated enough to purchasing a house and complaining about that smacks of entitlement. I never had a help-to-buy ISA, or help-to-buy at all. I bought just before the financial crash too, but I ended up selling my 2007 hard won possession for £135,000 (yes I know, I robbed them too).

Edit: Oh and to save up for the wedding I sold my guitar (£1000), amp (£500) and I went onto a diet which basically meant I was spending £1 a meal. Extreme, yes. I would absolutely say my quality of life suffered, and that was a choice I made in order to get on the ladder and get on in life. We're easily the youngest home owners on the estate which is exclusively 4 bed detached and I would probably sit in the middle class income bracket now. I do sometimes look at those posting photos on instagram of their trips in India, Australia, America, etc... with envy but I'm catching up because I'm settled and stable. This year we'll have gone to Ukraine twice, Venice, Paris, and a 14 night tour in East Asia because last year we only went to Ukraine and Corfu because we were in the middle of a house purchase.

Cakeguts

I could afford to spend the budget mentioned but I would consider spending money on something that I could get for less as wasting money. So paying for a gym when I could exercise at the local leisure centre or in the local park I would consider as wasting money. I have a Tesco contract Smart phone costing £7.50 per month. I could afford to spend a lot more on a phone but won't because it does what I want it to so spending any more would be a waste of money.

I have never thought in terms of having x amount of money to spend each month but more in terms of what I actually need to spend and then not wasting money on things that I don't need like an expensive mobile phone, or gym membership when there is a perfectly good leisure centre.

In terms of reducing waste there is also a good argument for buy good quality clothes and making them last rather than buying fashion clothes. People tend to throw too much away.

davomcdave

ukcarper wrote: »

I don't think anybody is dissputig property is expensive in the South East especially in commuting distance of London.

I needed a larger deposit larger than that in relation to earnings in the early 70s. As i have been saying if you earn enough to get mortgage (which would be a joint income of £70k for that house) you can save deposit.

If you read the next 2 pages of depressing twaddle apparently there is no affordability problem, it's fe ckless youth being fe ckless.

ukcarper

davomcdave wrote: »

If you read the next 2 pages of depressing twaddle apparently there is no affordability problem, it's fe ckless youth being fe ckless.

It large parts of the country it's no harder now than it was in the 70s. The problem as I see it is mainly confined to London and the south east, and the problem is the amount of money you can borrow which is determined by how much you earn. If you earn enough to get that mortgage with some effort you should be able to save deposit.

westernpromise

ukcarper wrote: »

It large parts of the country it's no harder now than it was in the 70s. The problem as I see it is mainly confined to London and the south east, and the problem is the amount of money you can borrow which is determined by how much you earn. If you earn enough to get that mortgage with some effort you should be able to save deposit.

Correct, and this reflects the fact that London is now an international city akin to Dubai or Hong Kong or New York, in which the economics of house buying are those of an internationally mobile demographic.

The idea that London house prices are unsustainable at any level because the locals can't afford them is then misplaced. What matters is whether the actual marginal buyers can afford them. I suspect Brexit will make them more affordable to that demographic rather than less.