A change in the way people own property?

Windofchange

zagubov wrote: »

It seems to me that all the large properties will be passed on to empty-nest pensioners who'll rattle about in excessively large homes while young families will still be stuck renting or buying small overpriced flats/starter homes where you couldn't (and shouldn't) swing a cat, let alone bring up a family.

This is my feeling. If there is no price correction, family houses will remain out of the reach of the masses, and will be passed down to children who are claiming a pension themselves. Will there be any incentive for these people to sell up? I guess also for that particular person, they also then have their existing house which then leaves them with further excess - bit like worried Jim.

Windofchange

worried_jim wrote: »

I’ll have paid my mortgage off in ten years at 53. My parents will be well into their 80’s so in “that” window and at 55 I’ll have access to 35 years pension savings so I’ll go from being a bill paying wage slave to potentially having a whole new life in front of me with lots of cash. I’m not planning anything (except the colour of my Porsche) but am aware that a lot will change almost overnight.

It's an interesting sort of predicament hey. Do you see yourself selling your current house or your parents one, or neither? If you have children, would you be in a hurry to pass this windfall on to them, or are they going to have to wait until you shuffle off this mortal coil to see any money?

GreatApe

Windofchange wrote: »

This is my feeling. If there is no price correction, family houses will remain out of the reach of the masses.

If house prices crash 50% what happens to the average floorspace per capita?

Herzlos

Inheritance has been skipping a generation for a while now. A grandparent left enough for me to get a deposit on a house, and I expect my parents will leave enough to top up my kids deposits on houses assuming they get to about 80. I'd rather they hung around longer but I need to be realistic.

I certainly don't buy Great Apes figures. We're well off on the whole but will be receiving an awful lot less.

Plus whilst 70% of pensioners own houses, how many are using equity release or in such a state of repair that massive investment will be required to bring them up to a sellable level. Both will eat a huge chunk of inheritance.

The distribution figures sound about right, assuming my family group is about the 50th centile. My parents entire estate is maybe £250k split between 2 is £125k each before care home costs, funerals and repair work. So maybe £60k cash, is still 2 pretty good deposits. But that midpoint is easily a quarter of your estimate.

economic

Herzlos wrote: »

Inheritance has been skipping a generation for a while now. A grandparent left enough for me to get a deposit on a house, and I expect my parents will leave enough to top up my kids deposits on houses assuming they get to about 80. I'd rather they hung around longer but I need to be realistic.

I certainly don't buy Great Apes figures. We're well off on the whole but will be receiving an awful lot less.

Plus whilst 70% of pensioners own houses, how many are using equity release or in such a state of repair that massive investment will be required to bring them up to a sellable level. Both will eat a huge chunk of inheritance.

The distribution figures sound about right, assuming my family group is about the 50th centile. My parents entire estate is maybe £250k split between 2 is £125k each before care home costs, funerals and repair work. So maybe £60k cash, is still 2 pretty good deposits. But that midpoint is easily a quarter of your estimate.

Have your parents always lived in uk and worked here? Or were they immigrants? How about your grandparents?

Where in the uk are your parents/grandparents living/lived?

Windofchange

Herzlos wrote: »

Inheritance has been skipping a generation for a while now. A grandparent left enough for me to get a deposit on a house, and I expect my parents will leave enough to top up my kids deposits on houses assuming they get to about 80. I'd rather they hung around longer but I need to be realistic.

I certainly don't buy Great Apes figures. We're well off on the whole but will be receiving an awful lot less.

Plus whilst 70% of pensioners own houses, how many are using equity release or in such a state of repair that massive investment will be required to bring them up to a sellable level. Both will eat a huge chunk of inheritance.

The distribution figures sound about right, assuming my family group is about the 50th centile. My parents entire estate is maybe £250k split between 2 is £125k each before care home costs, funerals and repair work. So maybe £60k cash, is still 2 pretty good deposits. But that midpoint is easily a quarter of your estimate.

I suppose it depends on the grandparent. Mine left their estates to my mother and father, but perhaps there will be more gifting to grandchildren given the current cost of housing? Bit of a wholesale shift to the norm of wealth passing to children. Another effect of us living longer perhaps?

GreatApe

Herzlos wrote: »

Inheritance has been skipping a generation for a while now. A grandparent left enough for me to get a deposit on a house, and I expect my parents will leave enough to top up my kids deposits on houses assuming they get to about 80. I'd rather they hung around longer but I need to be realistic.

I certainly don't buy Great Apes figures. We're well off on the whole but will be receiving an awful lot less.

Plus whilst 70% of pensioners own houses, how many are using equity release or in such a state of repair that massive investment will be required to bring them up to a sellable level. Both will eat a huge chunk of inheritance.

The distribution figures sound about right, assuming my family group is about the 50th centile. My parents entire estate is maybe £250k split between 2 is £125k each before care home costs, funerals and repair work. So maybe £60k cash, is still 2 pretty good deposits. But that midpoint is easily a quarter of your estimate.

You dont mention the other side of your family.

You say your parents estate is worth about £250,000 split between two people with an unknown amount assumed for care home fees and repair to their home. You suggest you might get £60k after those costs but it could be upto £125k if those costs are nil

Well what about your wife side? If it was the same again that is another £60-£125k then the combined figure is £120-250k

When you get that capital you have options. Lets use the mid point of that range so £185,000

That capital will give you a 5% real return which is a £9,250 annual bonus to your household.
You can either up your spending or continue spending as you are and choose to save it.
If you choose to save the capital that £185,000 becomes £800,000 in 30 years time in real terms.
Almost all of it tax free if you put it into your ISAs over a period of about 5 years

GreatApe

Windofchange wrote: »

I suppose it depends on the grandparent. Mine left their estates to my mother and father, but perhaps there will be more gifting to grandchildren given the current cost of housing? Bit of a wholesale shift to the norm of wealth passing to children. Another effect of us living longer perhaps?

Living longer has been somewhat balanced out by a bigger age difference between the generations. The bigger impact has been going from near 2.8 children per woman in the 1960s to closer to 1.7 children per woman now (for the locals)

Cakeguts

What I want to know is how many of the people who can't afford to buy a house actually have a car? One of the best ways to save money is to not buy a car. Even for a cheap second hand one you can get a lot of bus journeys out of a tank of petrol and the insurance cost. Unless the car costs under £1000 you also have to count the cost of depreciation.

Herzlos

I don't think the wills will skip a generation; inheritance will still pass to a direct result descent but in most cases the descent will be at an age where they don't need it and is likely to gift it to their kids, who likely do. Assuming the ages are about 85/55/25.

I have a house, so I expectany inheritance I get at any point will be used solely for my kids benefit.

GreatApe wrote: »

You dont mention the other side of your family.

Essentially nil split 3 ways.