I saw a short video on the BBC News app showing a young couple, George and Sophie, who were looking to buy a property in Islington, North London. However, Islington is quite a desirable area, and even a one bedroom flat there costs in the region of £600,000. Between them George and Sophie earn £58,000 (he is a surveyor and she is a midwife), so they could only afford to borrow £261,000.
It’s a problem affecting young couples all over the country, but obviously more so in London. Without the bank of Mum and Dad to fund the deposit, it is extremely unlikely that young people will be able to get onto the housing ladder at all. We gave a deposit to our eldest son, and our youngest son and his wife were given a deposit by her parents. Without our help they would have had to rent. As it is, they are both paying huge mortgages, but at least they will own their own house in years to come.
House prices are rising faster than wages can keep up. When Sam and I first went house-hunting back in 1979 we were allowed to borrow 4 times his salary. My wages were not taken into consideration at all, as of course it was expected that I would give up work when we had children. Sexist I know, but it was a common sense way of looking at it. We found a one bedroom flat for £20,500. I did indeed give up work to become a mother two years later, and we had an easier time of paying our bills than our sons do today. These days both my daughters-in-law have no choice but to work to help pay the mortgage, as now a combined salary is taken into account.
George and Sophie were disappointed at not being able to move into the area of their choice. They said that many young people are moving to other cities such as Manchester or Birmingham, but for them a move out of London was not possible, so they would continue to rent.
I feel sorry for young couples today, although my mother shakes her head and informs me that most married couples in her day lived with one set of parents for years in order to save up for a deposit. She says that nowadays they ‘want it all and want it now’. The thought of Sam and I having to live with either my mother or his parents at the time of our marriage still appals me today. To fund our deposit Sam worked all day and all night at his MOD job, then went home for half a day’s sleep. When he came back in the afternoon he carried on working through the night and into the next morning, going home for another half day’s sleep. This regime carried on for about 6 months before we were married, and I hardly ever saw him. However, at the end of 6 months he had saved the princely sum of £2.500, enabling us to put a deposit down on the previously mentioned one bedroom flat in Addiscombe, South East London. Today I expect that same flat costs in the region of £300,000. It’s madness.