Redistributing wealth between the generations

You are all basing this on southern prices,the flat we bought for 14k in 1982 is now valued at 70k ,so still easily affordable on average wage or less,in the time since we had it its had several new bathrooms and kitchens and an attic conversion giving two extra rooms,its also been re double glazed at least 3 times .Its had more money spent on it than its now worth.Of course the mortgage rate is much lower now than the 16% it was then too.Its almost next door to our business so I see all thats happening to it and am friends with the current owner so my info is accurate

Was discussing this same thing with friends last night. We have helped our son get on housing ladder because fortunately we can afford to, and we have only one child. But I agree with others, when we were saving for a house, we barely went out and didn't have holidays. But the youth of today, even when saving for house deposit, seem to still go out eating and drinking and still have holidays. The same with a lot of young married couples with children. We hear all the time how difficult finances are for them, but most of the young families I know (who are in average paid jobs) have their annual holidays and a decent social life. I don't begrudge them. They are only young once. But it tests my sympathy a little.

Gave 2 Sons/DILs deposit for their houses. Will do the same for DD. We enjoy seeing them and the DGC happy in their own homes. We are also in the process of handing over our business to them, on the understanding that we still get our salaries. They are extremely grateful and know they are very fortunate. DD and GS live with us since she has got rid of the idiot, we are happy to give her the support she needs at this time. I am pleased that I can give them a hand, and enjoy seeing them happy, it will all be theirs when we are gone anyway.

I think many of the current problems arise from trying to manage expectations in the the wake of the selling off of council houses, which has completely distorted the housing market.

Over 4.5 million council houses have been sold off since the policy started in 1980. That is 4.5 million houses sold at massive discounts of up to 75% to people who would not otherwise have been able to afford to own a house. Because their parents are owner occupiers the children of these purchasers also aspire to home ownership on similar wages but they need to be able to afford the full market price and that is just not possible.

In the days before council houses were sold off around a third of the population lived in publicly provided housing at affordable rents and with secure long term to life long tenancies. I doubt this % has changed - except that there is no longer public sector housing to provide them with the secure long term tenancies at an affordable rent that their parents were able to start life in.

How can we remedy this? I do not know. Stopping the scheme would be a start. Younger people lucky enough to get a public sector home can get discounts of up to £100,000 off the value of their home when they buy it. Perhaps the government could extend that £100,000 bonus to all first time buyers or cancel the right to buy scheme completely, so houses built in the public sector stay there.

While I have no patience with those who say they can't save - while having expensive holidays/cars and eating out a lot, etc. , I do think there are many for whom buying a house is that much harder now, no matter how careful they may be.

The house Dh and I bought when we were still only in our late 20s would be proportionately WAY more expensive compared to incomes now. There is no way we could have afforded it then if prices had been at current levels - and although it's a nice house it's nothing very special.

My dds and son in law are all hardworking and not at all extravagant, and from all I've seen, most of their friends are the same.
We have willingly helped them to buy homes a little bit bigger/nicer than they could have afforded on their own - though I might add that dd and SiL refused all help when buying their first house - and I am well aware that we are very fortunate to have been able to do so.
I would do the same again in a heartbeat. They have all been very grateful - they did not in any way demand it or expect it as of right, though I know that's not always the case.

It strikes me that possibly those older people who think they had it easy, probably DID have it easy. I had a friend who was provided with a three bedroom detached house upon her marriage, her new husband’s father owned a building company, and the newly married couple only needed to pay the cost price of the house which was far less than the sale price. The father had also given his son a car, and the son also had a firm’s car provided by his employer. This friend certainly did have it easy.
However, that was not the story for me, and I suspect not for many other Gransnetters. Judging by the posts on this thread, most Gransnetters certainly had it anything but easy, and I count myself among them. Life was not easy, we didn’t enjoy the luxury of foreign holidays (or any holidays in most cases) and we didn’t run cars, expensive or otherwise, we never, ever bought expensive take away coffeee (it didn’t exist as far as I know) and we didn’t furnish our first homes (usually rented) with expensive new furniture, including every expensive gadget known to man (think expensive coffee makers or juicers) and we didn’t buy expensive mobile phones and upgrade them every couple of years, in fact many of us had no phone at all. However we certainly did pay enormous interest rates on our mortgages when we eventually managed to scrape a deposit together to buy our first, small houses.
Incidentally, the wealth acquired by house prices rising is only going to benefit our children when we die, unless of course we need care, in which case it will disappear into the clutches of the local authorities. Wealth locked inside a property is not particularly useful to the occupants, as actually they need said property to live in.

and to make some possibly tongue-in-cheek observations.
Yes,I thought it was tongue-in-cheek and tried to respond in kind!

Different generations have different values.
Like others we started off with an old banger ( the car, not the wife ) and mpg was the major consideration in the purchase.
Todays generation veer towards leasing a new vehicle.
We are expected to subsidise their lifestyles and in particular child minding is not only expected but taken for granted.
I get a daily email from Gransnet showing the five main topics of conversation, as I do from Mumsnet.
I rarely read the Mumsnet contributions but one topic was why should we have it all and they should struggle. For me that sums up their attitudes.
We expected and indeed received no help from our parents, that was the norm.
I spoke with a lady from the gym some time ago who informed me that her daughter and partner and child had moved back in with her so that they could save for a deposit for a house.
They were paying her £250 a month!! going on holidays and even had another child whilst staying there.
What I didn't realise it at the time, and only found out by reading my email from WhatMortgage was that it impacts the householders future life financially.
The money that she is subsidising her family with could have gone towards her pension and this will never be regained and it could even mean that she will have to work longer before she could afford to retire.
I never saw her again.
The cynic in me tells me that she probably couldn't afford to carry on with her gym membership fees.

Day6, only thing I'd say is that the workplace has become a highly competitive and unbearably stressful environment - for professionals and blue collar workers alike it seems to me, with workers' rights seemingly a thing of the past. Nowadays you've got to be grateful to have a job, be willing to put in hours over and above, and then return home and be the perfect parent with a full social diary for the kids to show you're doing the best by them - and that's competitive too.

Not saying any of the above is right - far from it - but must be hard to buck the trend. Question is how was it allowed to get like this? I have my own very un-PC opinion about that!

I'm glad that my AC have their own homes without asking mum or dad or inlaws for help. They all started work at 16 and all had left home before they were 19 to pursue their careers and none have ever claimed benefits. If you want something, there are jobs out there and you'll appreciate what you buy with what you earn, far more than the easy money of handouts.

I’m not bitter about the younger generation, But articles like this are meant to arouse that feeling.
In the early 70s, we had no money to speak of. The mortgage for a little terrace, (and I’m not talking about near London) when we managed to get one after much saving and doing without, plus rates and utilities left us with £6pw to live on. It meant walking to work, no nights out and no holidays. Things did eventually get better though the 17% interest period didn’t help.
I agree that house prices are ridiculous now, but they seemed ridiculous back then too.
I don’t remember feeling as aggrieved as some do today. We do occasionally help out if needed and have acted as a ‘stay over’ place when offspring were moving house, but I don’t want to fund others’ lifestyle with my hard earned money.

Jalilmal108
How true. Doesn't always work out like that does it.
You can take a horse to water but can't make it drink
I will never understand my own children.Brought up the same but chalk and cheese with out a doubt.

Unfortunately in some areas there are no jobs out there - and those there are pay minimum wage! Plus there are hundreds applying for every job.

I wonder how many who have commented on this thread have actually read the article I posted a link to.

Very few of them, I'd suggest, janea. Now Gnet has made it worse by making it a featured 'discussion' and completely skewing the OP's original purpose by calling it 'Why are so many pensioners still supporting their adult children?'

So not even Gnet bothers to read the OP.

AmMaz - I was going to make a similar point.
The thing that helped us older folk to become economically stable was the fact that it was easier to get a job in our days. There wasn't the same worry of being made redundant, or on a short -term contract.
So we weren't so scared of committing to a mortgage even though borrowing money wasn't easy.
I worry that our grandchildren will have to struggle in an unpredictable job market.

“Young people go to the gym” “young people have holidays “ etc. So much bitterness

Excuse me gillybob, that is NOT bitterness, it is a fact. I include my own AC in that!

It is remark regarding the difference in lifestyles and the expectations of a generation.

It illustrates the way in which being 'hard up' is relative. And not all young people have disposable income, but we tend to hear a lot more about how awful it is for younger people today but very little about the real hardship suffered when their grandparents were making their way in the world.

I really do think we live in a mad world when a person with very little still HAS TO HAVE an iphone costing £500+ and nothing else will do. Comparisons are odious but the way society has evolved in terms of wants and material goods is quite shocking. The word deprived does not apply to many. Not only that, grandparents are still supporting their adult children and going without themselves, when they have known hardship and have budgeted for most of their lives. Many pensioners are still living with very little.

As others have said the old are being demonised from all quarters. Is that not bitterness and anger gillybob?

I've skimmed the article now, and it's an interesting idea.
We're currently staying in a rather affluent part of the SE and I'm amazed at the apparent standard of living of so many people. Mostly 'babyboomers'.

I will never understand my own children.Brought up the same but chalk and cheese with out a doubt.
There must be something in the genes I think, because so are mine (well, one is) sarahellenwhitney

Some parents are partially supporting adult children because the young adults are out of work and cannot get work. In this kind of case, I find it quite natural to help out, after all we love our children!

The price of property has sky-rocket all over Europe, whether you want to buy or rent. Renting property, you are IMO basically using your money here and now to keep a roof over your head and not able to save for the future, so investing in property makes better sense.

I do agree that for our generation it makes no sense that younger people move into a house and want and expect to buy furniture and everything else not only new, but the latest fashion as well and feel entitled to have holidays etc.

I would make it very clear before offering an AC help while they are saving up for a house, that they can save much more quickly if they do not go on expensive holidays and evenings out while they are saving up.

However, each to his own, I can well believe many of you bite your tongues rather than risk offending your dear ones.

Another Pythonesque comment... by dint of hard work and few treats we managed to save £3250 in the 1960s. That would have bought a house but the one we liked cost £500 more than we had. We asked the BS with whom we had saved the sum for a mortgage. We were turned down even though we were both professionals and in work. Another few years renting before we could even get the small loan required. I can't remember that we felt entitled to anything but did withdraw our savings from the BS concerned

To get our deposit in the 1970s we lived with in laws for a year to save up £1000 - the deposit on a house that cost £8000. We did little, no car, I worked in a London bank and OH had a salary of £1000 pa. All our early lives were very difficult and we were permanently broke. Interest rates went up on a regular basis and we had no help from families (expect for living with in laws in the the first year). I married when I was nearly 18. But is was OK, I knew everything!! (not)

I'm really not surprised that we get attacked from all corners when all we can offer is 'my deprivation was worse than yours' and absolutely no appreciation of the difficulties facing young people today. Smug self satisfaction at our own perfections and total lack of sympathy for the younger generations doesn't help anyone or win us any friends.

We had an endowment mortgage but. luckily, a move of house meant we switched to a standard mortgage before people realised that endowments were never going to pay out enough to clear their mortgage - feel so sorry for those who didn't switch. People writing these sorts of articles usually forget to mention the sky high interest rates we had to contend with - we, like many other couples, had second hand furniture and hand me downs and a holiday was camping with a tent borrowed from my sister in law. We had just one car that my late husband spent his spare time working on to keep it running! I have worked most of my adult life and, even though I took early retirement at 59 I have since looked after my daughter and my three grandchildren on a full time basis so she can continue to work after becoming a single parent when ex s-i-l walked out on them. We are not lazy or greedy - that really makes my blood boil when I see those accusations and yes, many of us do help out our adult children simply because we have been there, done that, struggled through and care enough that we don't them to have to do the same. So much that is written in the media is designed to set one generation against another - what we need to do is unite in battle for a fair life for us all, regardless of whether we are young people starting out or older people trying to enjoy their retirement years!

A new research paper from Angus Deaton, Nobel laureate in economics, also finds that we are all persistently disappointed by life. Around the world, people tend to feel that in five years’ time they will have climbed a rung or two on life’s ladder, but most of us fail to do so. It is not quite clear why: did we not get as much money, status and sex as we were hoping for?

The article is quite fluffy and written from an American perspective. - but the above perhaps sums it up.

Are humans ever satisfied? I think we strive more in our youth, want more, want to see ourselves moving on. It seems more desperate and urgent to be 'getting on', especially today when discussions online, articles, twitterfeeds and news programmes focus on divides yet never make the point that all of life tends to be a struggle in one way or an other, and then you die!

The ease I know know is because I became very ill with stress-related conditions and had to leave work. I had a life of hardship as a single parent. I felt the pinch though, so returned to work, against doctor's advice. There is no more 'striving' and very few aims or goals left. but many pensioners are still working, many women who have had their OAP moved back six years with little notice are struggling financially. The world isn't rosy for many old people. We mustn't forget that. How awful it is to work hard for a lifetime and find yourself in the twilight of your life still having to count the pennies? That happens too.

Younger people tend to have hopes and dreams. We did. They strive because they have to. No one is going to give them a life on a plate, ready made. It's nice to be young, bit it's also hard work, raising a family, paying bills etc. The pressure is on. But it's ALWAYS been like that.

That is probably the gist of the article.

mernice

My father died in 1962. He was headmaster of a large school in a large City.
He died intestate.
When his finances were sorted mum received a year of his salary = £1,000.
The house we then lived in was 1 of 10 originally built by a private company who went bust and the council bought them up.
In a leafy suburb with walled gardens and wrought-iron gates, wisteria and lilac trees and attached garages, it was an idyllic place to bring us up in but, after dad's death, mum had to find a job, and soon, as my brothers were 16 and 5 at the time. When she approached the council to buy the house with a deposit of £500, DOUBLE the £250 deposit required.
The head of housing (who lived 4 doors away) refused as he wasn't convinced mum could meet the repayments which were LESS than the rent. ???
That house sold for £684,950 in Nov 2016. It's part of a large northern town, not a swanky southern scene and the road and general area is now, exactly as it was then in 1962.
From that, I can extrapolate the facts that a 3 bed semi with front and rear gardens, veranda and attached garage was, in 1962, selling for £1,750 needing a deposit of £250 and a headmaster's salary was £1,000 = 57.4% of the house price.
How does that equate nowadays...I wonder.