Will the next generation be able to buy their own house?

snowqueen555

Barny1979 wrote: »

Maybe the current younger generation spend disposable income on Sky, Netflix, beer, nights out, cars on hire purchase etc, that weren’t out there for similar ages in previous generations?

I don't think it's fair to simply say they spend it on things they shouldn't.

If anything, the current generation don't go out on big boozy nights like they used to, the trend is the buy food/takeaways and stay in, because it's cheaper, the because youngsters nowadays drink less alcohol than previous generations.

Zero_Sum

snowqueen555 wrote: »

I don't think it's fair to simply say they spend it on things they shouldn't.

If anything, the current generation don't go out on big boozy nights like they used to, the trend is the buy food/takeaways and stay in, because it's cheaper, the because youngsters nowadays drink less alcohol than previous generations.

The current generation are consuming less units of alcohol, but im not sure about spending less on nights out. Drinks are now more expensive, and with many favouring these fancy gins & cocktails which cost more than a bottle of wkd. Also I think eating out is now more common, thats something we'd have never done 20 years ago. The big boozy nights out werent really that expensive as the first few hours were in the local social club then head into town at 11pm

snowqueen555

Zero_Sum wrote: »

The current generation are consuming less units of alcohol, but im not sure about spending less on nights out. Drinks are now more expensive, and with many favouring these fancy gins & cocktails which cost more than a bottle of wkd. Also I think eating out is now more common, thats something we'd have never done 20 years ago. The big boozy nights out werent really that expensive as the first few hours were in the local social club then head into town at 11pm

In my experience 20 years ago people were always eating out. I think it is difficult to make a conclusion based on our own experience, as they will obviously differ.

One thing is for sure, the current generation spend much more on renting than in the past.

ian1246

Its all about how you choose to spend your money - if the future generations are financially smart/educated, then they should be able to afford to buy their own houses.

I'm 30 and my wife is 27. We own a 3bed semi-detached property and have done so for nearly 4 years. 21years left on the mortgage - we brought it for £165,000 with a 25% deposit (£41,250) and hopefully next year will be able to re-mortgage at a better rate (40%+ LTV). Current mortgage stands at £109,595, whilst the house is somewhere around £190,000-£195,000 value.

But we didn't get there by spending our money on daily lunches, daily coffee and going out every weekend getting boozed up. Nor did we chase the latest iPhone or feel the need to buy brand new cars on finance.

When we brought our house (26 & 23 respectively), I was on just £22,000 a year whilst my wife (girlfriend at the time) earnt £10,500 - both well below the national average. Its all about sensible planning and living within your means - making sacrifices in some area's in order to get what you want in other area's. We were both admittedly fortunate - before we met, we were individually saving for a house so when we got together, we combined our deposits.

Nonetheless, the point stands. Many of our peers do spend money frivolously - then complain when they are in their overdrafts and can't afford to buy a house or anything else "meaningful", yet when the next pay check comes along blow it all within 1-2weeks, rather than budgeting and planning ahead.

I think, ultimately, the affordability of homes for future generations will depend just as much upon culture and financial education as it will upon the actual performance of the job market and wider economy.

ukcarper

ian1246 wrote: »

Its all about how you choose to spend your money - if the future generations are financially smart/educated, then they should be able to afford to buy their own houses.

I'm 30 and my wife is 27. We own a 3bed semi-detached property and have done so for nearly 4 years. 21years left on the mortgage - we brought it for £165,000 with a 25% deposit (£41,250) and hopefully next year will be able to re-mortgage at a better rate (40%+ LTV). Current mortgage stands at £109,595, whilst the house is somewhere around £190,000-£195,000 value.

But we didn't get there by spending our money on daily lunches, daily coffee and going out every weekend getting boozed up. Nor did we chase the latest iPhone or feel the need to buy brand new cars on finance.

When we brought our house (26 & 23 respectively), I was on just £22,000 a year whilst my wife (girlfriend at the time) earnt £10,500 - both well below the national average. Its all about sensible planning and living within your means - making sacrifices in some area's in order to get what you want in other area's. We were both admittedly fortunate - before we met, we were individually saving for a house so when we got together, we combined our deposits.

Nonetheless, the point stands. Many of our peers do spend money frivolously - then complain when they are in their overdrafts and can't afford to buy a house or anything else "meaningful", yet when the next pay check comes along blow it all within 1-2weeks, rather than budgeting and planning ahead.

I think, ultimately, the affordability of homes for future generations will depend just as much upon culture and financial education as it will upon the actual performance of the job market and wider economy.

I think you illustrate that housing is not a problem everywhere, where I am a semi would cost twice what you paid and you would not get a 1 bed flat for £165k.

MEM62

Will the next generation be able to buy their own house?

As in the past some will, some won't. It depends on circumstances and how committed they are. It maybe more difficult but not impossible. Both my nephews (early 20's) have bought their own homes.

Malthusian

snowqueen555 wrote: »

One thing is for sure, the current generation spend much more on renting than in the past.

Because they can afford to, and more people want to use their higher earnings to rent a studio flat for themselves rather than a room in a houseshare.

The point about less but more expensive alcohol is entirely right. 10 years ago advertising for alcohol was wall-to-wall Carling and WKD. Now it's Sipsmith's. Most 20-somethings - certainly those aspiring to buy their own house rather than make it to the front of the council house queue - would turn their noses up at WKD now.

Thrugelmir

snowqueen555 wrote: »

In my experience 20 years ago people were always eating out. I think it is difficult to make a conclusion based on our own experience, as they will obviously differ.

More places to eat out or grab a takeaway than ever before. Coffee shops abound. People working in such establishments are bottom of the pay rung with little opportunity to progress upwards and improve their lot.

Thrugelmir

ian1246 wrote: »

with a 25% deposit (£41,250)

I was on just £22,000 a year whilst my wife (girlfriend at the time) earnt £10,500 -

You saved that deposit on those salaries?

ian1246

Thrugelmir wrote: »

You saved that deposit on those salaries?

Most of it yes - £25,000ish saved by myself, whilst my wife had saved up around £19,000 - roughly £10,000 of that though was from left-over student loan she'd never used and a small inheritance from her grand mother.

We'd each been saving separately before we met in March 2015. In August 2015 we decided we wanted to live together but weren't prepared to rent (We felt it was wasted money!), so we took a chance and put an offer in on a house (moved in in November 2015) with a deed of trust splitting the house 60%-40%. It was a risk, but the house prices were rising steadily so we both kind of figured if we did separate, provided we'd owned the house/stayed together for at least 12months the increased house value would at least partially offset the solicitor/estate agent/ mortgage redemption costs of selling the house, whilst any remaining "costs" not offset would have been been roughly equivalent to our costs if we had rented for the same time frame.

Weighed against that risk, though, was that we'd have got onto the property ladder at age 26 & 23 respectively and managed to buy a good sized house (3bed semi with a extension, off-road parking, front & back garden & garage) in a nice area which would suit our needs for the future. We got married in August 2018 :beer: