Disclaimer: Gen Xer here, very comfortably off with a large property on a long fixed mortgage at a low rate, with a big AFPS75-heavy pension to come, so what I'm about to write is not motivated out of jealousy, frustration or lack of financial nous. I'm doing very well indeed. But I also pay close attention to the issues facing younger people now.
Boomers. It is no use harking back to 15% interest rates and disciplined budgeting and refraining from luxuries, etc etc etc. There are fundamental differences between the economic situation in which you paid those mortgage rates and the situation which millennials and Gen Zers have experienced for almost their entire adult lives. One, your interest rate spikes were more or less matched by wage inflation, at least if you had an effective union (as many more civilians did). Two, your mortgage interest was tax deductible. Three, your mortgages were restricted to a lower multiple of earnings, which kept a lid on house prices and deposit sizes. Four, the large increase in City remuneration following deregulation of investment banking and the slightly later influx of foreign money to London property had not yet had their distorting effects on the market, with ripples out along commuter lines and into the regions via second homes. Five, housebuilding has fallen ever further behind population growth, constrained by the grip of NIMBY voters on local planning authorities and compounded by changing social norms which have increased the number of single-occupant and single-parent households. All of that makes getting onto the property ladder without some form of windfall support an increasingly hopeless task for young people.
Making life doubly miserable for them in the latest crisis is the fact that wages are emphatically not keeping pace with inflation, and rents (for those not fortunate enough to be eligible for social housing) are astronomical due to the imbalance between supply and demand.
My parents had completely unremarkable careers which if they'd been military might have seen Dad rising to FS and Mum to Cpl with 10 years out of the workplace mid-career. Yet they were able to retire before either reached 60, mortgage free in a house which (had they not sold it to top up Dad's superb final salary pension) would today be worth almost a million pounds, having put a child through private school at their own expense and holidayed at least once per year (a rate which has increased since retirement). The idea that a young couple of similar standing today could accrue such wealth or aspire to such a lifestyle is simply laughable. Their discretionary spending could be zero, and it would still be impossible.
So, please save the exhortations to budgetary discipline. The best way you can help younger people to get on is to write letters in support of every planning application for housing in your district, green belt or not. Be a YIMBY. If you want to go all in, vote for election candidates who promise to support housebuilding. Yes, it will erode the paper value of your property. No, you did not earn all of it.
Last edited by Easy Street; 12th Jun 2023 at 20:58.