Impossible to save enough to get a deposit nowadays unless you are on a properly decent wedge. Even the 5% deposit schemes are flawed, as though it's easier to raise 20k instead of 40k, the likelihood of getting a 95% mortgage is slim to none
With the fall in the value of the Pound Sterling, I would sadly expect foreign investment in London property to increase - it's cheap as chips for them. Just go to Bicester Village to get an idea of how cheap we are now and how they're onto us as a cheap market in general.
We urgently need to follow the Aussies before it's too late - assuming it's not too late, which it might well be.
I refer you to a Genesis album from the early 1970s .. 'Selling England by the Pound' .. nothing new here .. everything is up for grabs .. companies, properties, railways, power companies .. you name it, we sell it and pay a heavy price later .. Australia has got it right
New changes in the U.K. Tax relief on Pensions is also having an effect - even though the Government have taken steps to dampen interest in second properties by way of duties. Imho, the duties are way too low and will not deter buyers who are redirecting what would have been pension funding into second properties or buy to let - this is also pushing prices up and reducing affordability of properties for our younger generations.
HMG is also removing tax relief on mortgages on buy to let.This will mean that a lot of landlords will need to get rid as profits disappear. I would expect a glut of 2 bedroom flats onto the market and prices of this type of property in particular to fall.
Interesting. I personally have no issue with landlords, as long as they're responsible and follow the relevant laws and legislation correctly. Those who don't should be barred from renting property out.
I specifically didn't mention targeting landlords because I actually think they provide a very real service, and enable people who are unable to buy to have a nice lifestyle in a decent area. Unfortunately, what happens to the poor tenants who get turfed out now that HMG is removing tax relief for the landlords? I fear that ideas a bit of a "shit sandwich".
As Mike says doing it on you own is nearly impossible but I should think most first time buys would be as a couple. I would assume a uni education would result in a decent salary. So times 2 makes it a bit more do-able.
I'm pretty sure that we are one of the only countries that are obsessed with home ownership. Rental in Europe is the norm.
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
The average first-time buyer age in some London boroughs is as high as 34, conversely the the average age of starting a family is lower than that. (I'll give you something though, the increased savings incurred by living at home with mum and dad would reduce the average first-time buyer age.)
On the other hand, staying with mum and dad isn't a luxury for most - and I dare say it wouldn't be too great for the economy.
I'm not saying this applies to everyone, and indeed not to Cabbles, but after every budget they interview people for the papers and there is always a couple, both still living at home, trying to save up a deposit for a house and it lists their monthly spending and as a proportion of their income they are saving diddly squat whilst at the same time going on holiday and spending a fair bit on eating out, socialising etc etc. In some cases it's just a matter of priorities, you want a property then you have to make sacrificies to get one.
Daughter bought a 2 bed flat on Heron Hill Belvedere 5 years ago and sold it last year for a 3 bed house a bit further out. My son bought a 2 bed house in Bexleyheath 3 years ago and is still there.
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
I finished full time education when I was 24 having taken a couple of 'gap years' in between uni and law school. Moved into rented accommodation with my ex from Summer 2007 onwards. Have been paying off student/graduate loans off since then (pleased to say both nooses were dealt with by 2012). I am sure if I had been a bit more financially prudent I may have savings, but even then I don't see how that they could be anywhere near what is required re: suitable deposits
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
The average first-time buyer age in some London boroughs is as high as 34, conversely the the average age of starting a family is lower than that. (I'll give you something though, the increased savings incurred by living at home with mum and dad would reduce the average first-time buyer age.)
On the other hand, staying with mum and dad isn't a luxury for most - and I dare say it wouldn't be too great for the economy.
What age did you move out, out of interest?
As echoed above, it's an absolute necessity for most in London. And something I'm actually looking forward to in 6 months time when I finish up in Leeds.
Average first time buyer deposit in greater London is apparently £90k now !!!
Well I would class Bexleyheath as Greater London so if your £90k is correct that is close to a 50% deposit looking at the lower priced properties on the link below, you could do much better than a 50% deposit.
I'm not saying this applies to everyone, and indeed not to Cabbles, but after every budget they interview people for the papers and there is always a couple, both still living at home, trying to save up a deposit for a house and it lists their monthly spending and as a proportion of their income they are saving diddly squat whilst at the same time going on holiday and spending a fair bit on eating out, socialising etc etc. In some cases it's just a matter of priorities, you want a property then you have to make sacrificies to get one.
I agree with this as well large. I'm a spender. I take full responsibility for what little savings I have. Good financial education is vital in today's climate. If I ever have kids I'll beat into them the need to be prudent.
But, you have to have a life. Even some of the simple things like going out and living a fairly normal life are bloody expensive now.
Imagine being in your 20's stuck living with your parents. What hell on earth that would be for some, I know it would have been for me. Your 20's are for living, the best years of your life.
People saying why didn't you stay living at home with your parents and save £50,000 for a shoebox - what a grim outlook. That's why I really do feel sorry for the younger generation - you really do have my sympathy (hopefully that doesn't come across as conceited).
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
The average first-time buyer age in some London boroughs is as high as 34, conversely the the average age of starting a family is lower than that. (I'll give you something though, the increased savings incurred by living at home with mum and dad would reduce the average first-time buyer age.)
On the other hand, staying with mum and dad isn't a luxury for most - and I dare say it wouldn't be too great for the economy.
What age did you move out, out of interest?
I was 23 and rented with friends. (1994) Bought a flat in Dartford in 1997 Sold that in 2001 Rented until 2008 then bought a house with my fiancee.
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
I finished full time education when I was 24 having taken a couple of 'gap years' in between uni and law school. Moved into rented accommodation with my ex from Summer 2007 onwards. Have been paying off student/graduate loans off since then (pleased to say both nooses were dealt with by 2012). I am sure if I had been a bit more financially prudent I may have savings, but even then I don't see how that they could be anywhere near what is required re: suitable deposits
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
Market forces at work, supply and demand, pure and simple. Demand continues to spiral upwards and supply simply cannot keep up. Prices escalate out of control, only the rich can afford, and the quality of life, traffic, parking, healthcare, just gets worse. Blame politicians of all persuasions for failing to look after the long term interests of the country and its people. All citizens eventually suffer, locals and those who have moved here from abroad. The FIRB rules in Australia have recently been toughened up, but before that there was a spell where the rich Chinese were outbidding local Aussies at most house auctions, especially in Melbourne. I have a friend there who was attended auctions for over a year, trying to buy, but found it was hopeless trying to outbid the Chinese. I sympathise with @cabbles as I have friends and relatives in a similar position. However there is also great merit in the work, work, work, save, save, save, invest etc, point of view. I feel there is now far too much emphasis on gaining degrees, racking up student dept etc for years, rather than leaving school, getting out on the tools and earning some money. Either that or be extremely careful and have a clearly defined route into a very well paid and high demand profession. That is not meant as a criticism @cabbles, because law certainly does fall into that category. But I hear of far too many young people who have spent years at uni, racking up huge debts, but cannot and never get to use their degree.
Imagine being in your 20's stuck living with your parents. What hell on earth that would be for some, I know it would have been for me. Your 20's are for living, the best years of your life.
People saying why didn't you stay living at home with your parents and save £50,000 for a shoebox - what a grim outlook. That's why I really do feel sorry for the younger generation - you really do have my sympathy (hopefully that doesn't come across as conceited).
That is bang on the money and I fully understand the need for a person to have a "life" however a couple of years hardship in an average life span can make such a huge difference.
My son has had a touch with the house he bought in Bexleyheath as the price has gone up more that the national average due to Crossrail coming to Abbey Wood Station. He has recently applied to extend his mortgage for home improvements and he could not believe it when the valuer told him what it was worth against what he paid for it 3 years ago.
Imagine being in your 20's stuck living with your parents. What hell on earth that would be for some, I know it would have been for me. Your 20's are for living, the best years of your life.
People saying why didn't you stay living at home with your parents and save £50,000 for a shoebox - what a grim outlook. That's why I really do feel sorry for the younger generation - you really do have my sympathy (hopefully that doesn't come across as conceited).
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
I finished full time education when I was 24 having taken a couple of 'gap years' in between uni and law school. Moved into rented accommodation with my ex from Summer 2007 onwards. Have been paying off student/graduate loans off since then (pleased to say both nooses were dealt with by 2012). I am sure if I had been a bit more financially prudent I may have savings, but even then I don't see how that they could be anywhere near what is required re: suitable deposits
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
Market forces at work, supply and demand, pure and simple. Demand continues to spiral upwards and supply simply cannot keep up. Prices escalate out of control, only the rich can afford, and the quality of life, traffic, parking, healthcare, just gets worse. Blame politicians of all persuasions for failing to look after the long term interests of the country and its people. All citizens eventually suffer, locals and those who have moved here from abroad. The FIRB rules in Australia have recently been toughened up, but before that there was a spell where the rich Chinese were outbidding local Aussies at most house auctions, especially in Melbourne. I have a friend there who was attended auctions for over a year, trying to buy, but found it was hopeless trying to outbid the Chinese. I sympathise with @cabbles as I have friends and relatives in a similar position. However there is also great merit in the work, work, work, save, save, save, invest etc, point of view. I feel there is now far too much emphasis on gaining degrees, racking up student dept etc for years, rather than leaving school, getting out on the tools and earning some money. Either that or be extremely careful and have a clearly defined route into a very well paid and high demand profession. That is not meant as a criticism @cabbles, because law certainly does fall into that category. But I hear of far too many young people who have spent years at uni, racking up huge debts, but cannot and never get to use their degree.
Agree in principle except there may be hundreds, if not thousands of empty properties in London which are owned by foreign investors who are just sitting on them waiting for them to appreciate in value - take Battersea Power Station development.
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
I finished full time education when I was 24 having taken a couple of 'gap years' in between uni and law school. Moved into rented accommodation with my ex from Summer 2007 onwards. Have been paying off student/graduate loans off since then (pleased to say both nooses were dealt with by 2012). I am sure if I had been a bit more financially prudent I may have savings, but even then I don't see how that they could be anywhere near what is required re: suitable deposits
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
Market forces at work, supply and demand, pure and simple. Demand continues to spiral upwards and supply simply cannot keep up. Prices escalate out of control, only the rich can afford, and the quality of life, traffic, parking, healthcare, just gets worse. Blame politicians of all persuasions for failing to look after the long term interests of the country and its people. All citizens eventually suffer, locals and those who have moved here from abroad. The FIRB rules in Australia have recently been toughened up, but before that there was a spell where the rich Chinese were outbidding local Aussies at most house auctions, especially in Melbourne. I have a friend there who was attended auctions for over a year, trying to buy, but found it was hopeless trying to outbid the Chinese. I sympathise with @cabbles as I have friends and relatives in a similar position. However there is also great merit in the work, work, work, save, save, save, invest etc, point of view. I feel there is now far too much emphasis on gaining degrees, racking up student dept etc for years, rather than leaving school, getting out on the tools and earning some money. Either that or be extremely careful and have a clearly defined route into a very well paid and high demand profession. That is not meant as a criticism @cabbles, because law certainly does fall into that category. But I hear of far too many young people who have spent years at uni, racking up huge debts, but cannot and never get to use their degree.
Agree in principle except there may be hundreds, if not thousands of empty properties in London which are owned by foreign investors who are just sitting on them waiting for them to appreciate in value - take Battersea Power Station development.
It says everything about their resources and their confidence in capital appreciation, that they don't even need to rely on rental returns to fund their property investments. Because of the rules of supply and demand, the downside risk is minimal. The potential upside is huge, barring another sub Prime type global meltdown. Without tenants they also have the flexibility to cash in their profits whenever they want.
Average first time buyer deposit in greater London is apparently £90k now !!!
There will come a point and I do not believe it is far away when the combination of falsely low austerity wages and insanely high property (purchase and rental) costs in London will lead to a crisis in provision of essential services.
Police officers, firefighters, nurses, doctors, teachers, waste, er, "operatives", cleaners, social workers and the like will simply have to give up on London and will move to other large but cheaper urban centres in order to live an affordable life.
We will then have a huge urban area where high cost private services are bought in by those in wealthy ghettos and there will be a subclass existing without the most basic services. The children of these will be brought up with a decreased life expectancy, a lack of basic education and with lifeskills based on survival in that scenario.
Average first time buyer deposit in greater London is apparently £90k now !!!
There will come a point and I do not believe it is far away when the combination of falsely low austerity wages and insanely high property (purchase and rental) costs in London will lead to a crisis in provision of essential services.
Police officers, firefighters, nurses, doctors, teachers, waste, er, "operatives", cleaners, social workers and the like will simply have to give up on London and will move to other large but cheaper urban centres in order to live an affordable life.
We will then have a huge urban area where high cost private services are bought in by those in wealthy ghettos and there will be a subclass existing without the most basic services. The children of these will be brought up with a decreased life expectancy, a lack of basic education and with lifeskills based on survival in that scenario.
Average first time buyer deposit in greater London is apparently £90k now !!!
There will come a point and I do not believe it is far away when the combination of falsely low austerity wages and insanely high property (purchase and rental) costs in London will lead to a crisis in provision of essential services.
Police officers, firefighters, nurses, doctors, teachers, waste, er, "operatives", cleaners, social workers and the like will simply have to give up on London and will move to other large but cheaper urban centres in order to live an affordable life.
We will then have a huge urban area where high cost private services are bought in by those in wealthy ghettos and there will be a subclass existing without the most basic services. The children of these will be brought up with a decreased life expectancy, a lack of basic education and with lifeskills based on survival in that scenario.
Happy New Year everyone.
This was a particularly pertinent article. The system is definitely broke when people are in work and homeless
@cabbles - why did you not wait until you had a deposit to buy a property rather than going into the rental market ?
I finished full time education when I was 24 having taken a couple of 'gap years' in between uni and law school. Moved into rented accommodation with my ex from Summer 2007 onwards. Have been paying off student/graduate loans off since then (pleased to say both nooses were dealt with by 2012). I am sure if I had been a bit more financially prudent I may have savings, but even then I don't see how that they could be anywhere near what is required re: suitable deposits
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
Market forces at work, supply and demand, pure and simple. Demand continues to spiral upwards and supply simply cannot keep up. Prices escalate out of control, only the rich can afford, and the quality of life, traffic, parking, healthcare, just gets worse. Blame politicians of all persuasions for failing to look after the long term interests of the country and its people. All citizens eventually suffer, locals and those who have moved here from abroad. The FIRB rules in Australia have recently been toughened up, but before that there was a spell where the rich Chinese were outbidding local Aussies at most house auctions, especially in Melbourne. I have a friend there who was attended auctions for over a year, trying to buy, but found it was hopeless trying to outbid the Chinese. I sympathise with @cabbles as I have friends and relatives in a similar position. However there is also great merit in the work, work, work, save, save, save, invest etc, point of view. I feel there is now far too much emphasis on gaining degrees, racking up student dept etc for years, rather than leaving school, getting out on the tools and earning some money. Either that or be extremely careful and have a clearly defined route into a very well paid and high demand profession. That is not meant as a criticism @cabbles, because law certainly does fall into that category. But I hear of far too many young people who have spent years at uni, racking up huge debts, but cannot and never get to use their degree.
Agree in principle except there may be hundreds, if not thousands of empty properties in London which are owned by foreign investors who are just sitting on them waiting for them to appreciate in value - take Battersea Power Station development.
It says everything about their resources and their confidence in capital appreciation, that they don't even need to rely on rental returns to fund their property investments. Because of the rules of supply and demand, the downside risk is minimal. The potential upside is huge, barring another sub Prime type global meltdown. Without tenants they also have the flexibility to cash in their profits whenever they want.
Which is why we need to implement the Australian system on Foreign ownership or similar - and quickly.
What next? Ban people from running more than one shop or restaurant as makes harder for others to do so?
Well one ain't gonna make a million running a shop up Grove Park BR Station that's for sure. I had visions of given Woolies a run for their money, but it was taken away by the Tesco Petrol Station across the way
one time friend of mine ran a kiosk on Bromley by Bow station for a long time .. what did him was the advent of the 'Metro' free paper .. people no longer popped in to see him for a paper, some cigarettes, bar of chocolate, gum, sweets etc., they just picked up a freebie rag and kept on walking down to the platforms .. such is progress
Comments
I specifically didn't mention targeting landlords because I actually think they provide a very real service, and enable people who are unable to buy to have a nice lifestyle in a decent area. Unfortunately, what happens to the poor tenants who get turfed out now that HMG is removing tax relief for the landlords? I fear that ideas a bit of a "shit sandwich".
I would assume a uni education would result in a decent salary. So times 2 makes it a bit more do-able.
I'm pretty sure that we are one of the only countries that are obsessed with home ownership. Rental in Europe is the norm.
On the other hand, staying with mum and dad isn't a luxury for most - and I dare say it wouldn't be too great for the economy.
What age did you move out, out of interest?
Most of my friends that own now have got there through money from their parents or living rent free for X amount of years and then leaving
As much as I enjoy my old man's company, my ex and I were never going to live with him and it's natural to want your own space, hence we, like 1000s of others rent and are then only able to save disposable income toward a deposit (unless you earn big money i equate this to individually colouring in the gaps of every letter of every book ever written. I.e. It is doable but I'll be near death by the time I do it)
The system is broke. We either flood the market with affordable housing, stop landlords charging exhorbitant rents or the government steps in and takes control. Something people won't like and goes against the principles of the free market
http://www.rightmove.co.uk/property-for-sale/find.html?locationIdentifier=REGION^150&sortType=1
But, you have to have a life. Even some of the simple things like going out and living a fairly normal life are bloody expensive now.
People saying why didn't you stay living at home with your parents and save £50,000 for a shoebox - what a grim outlook. That's why I really do feel sorry for the younger generation - you really do have my sympathy (hopefully that doesn't come across as conceited).
Bought a flat in Dartford in 1997
Sold that in 2001
Rented until 2008 then bought a house with my fiancee.
The FIRB rules in Australia have recently been toughened up, but before that there was a spell where the rich Chinese were outbidding local Aussies at most house auctions, especially in Melbourne. I have a friend there who was attended auctions for over a year, trying to buy, but found it was hopeless trying to outbid the Chinese.
I sympathise with @cabbles as I have friends and relatives in a similar position. However there is also great merit in the work, work, work, save, save, save, invest etc, point of view. I feel there is now far too much emphasis on gaining degrees, racking up student dept etc for years, rather than leaving school, getting out on the tools and earning some money. Either that or be extremely careful and have a clearly defined route into a very well paid and high demand profession. That is not meant as a criticism @cabbles, because law certainly does fall into that category. But I hear of far too many young people who have spent years at uni, racking up huge debts, but cannot and never get to use their degree.
My son has had a touch with the house he bought in Bexleyheath as the price has gone up more that the national average due to Crossrail coming to Abbey Wood Station. He has recently applied to extend his mortgage for home improvements and he could not believe it when the valuer told him what it was worth against what he paid for it 3 years ago.
This is how it was in 2014 - please see Link.
http://www.bbc.co.uk/news/business-26980299
Followed by a more current view from The Guardian,
https://www.theguardian.com/commentisfree/2016/oct/04/foreign-investors-housing-crisis-sadiq-khan-london
Police officers, firefighters, nurses, doctors, teachers, waste, er, "operatives", cleaners, social workers and the like will simply have to give up on London and will move to other large but cheaper urban centres in order to live an affordable life.
We will then have a huge urban area where high cost private services are bought in by those in wealthy ghettos and there will be a subclass existing without the most basic services. The children of these will be brought up with a decreased life expectancy, a lack of basic education and with lifeskills based on survival in that scenario.
Happy New Year everyone.
https://www.theguardian.com/commentisfree/2016/dec/20/working-homeless-britain-economy-minimum-wage-zero-hours
again, I digress from perhaps the original point, but it's all linked for me