I think it could be a generational thing but millennials, people of my generation, are finding it increasingly difficult to get on the property ladder without any kind of financial backing or support from somewhere. I know that we wouldn’t be in our position now had we not been fortunate enough to have Jamie’s parents help us get a “boost up” (remember those?) – although that is something I’ve had to come to terms with.
I have always seen myself as fiercely independent. I’ve hated ever borrowing money, even if it was just a fiver, and I always had a set plan in my head about getting myself sorted with a good house, a nice car and a few holidays before I ever started a family, but some things you just can’t plan. I always knew that if I was going to live independently that I would want my money paying something off that I would own at the end rather than feeling like I was throwing money down the drain in rent.
However, I was actually part of a conversation the other day about how certain people always feel they’re entitled to own their own home, or feel that they’re entitled to go on holiday abroad each year when the reality is they’re unable to afford it. Growing up I never felt like I was entitled to own my own home, but it was definitely something I aspired to. It was something to work hard towards and would act as a reward . The problem is that house prices are rising, the cost of living is going up and wages are pretty much stagnant. It’s incredibly difficult to be in a position where you’re saving enough money for a deposit, or people are already stuck in a renting rut with few ways out.
It was the Summer of 2012 and I had just spent the last month buying a few bits for the one bed annex we were about to move into. Jamie had been in Tanzania for the whole of July and on his arrival home we were set to start living together. We’d only been together since the start of the year but everything had fallen into place so quickly and I was happy to be moving into a space we could call our own.
We had a fantastic deal when it came to renting as it included all the bills; we literally only paid for a couple of other extras on top of that, as well as all of our own food. The only problem was, I just hated renting full stop. I felt like it was dead money and that it wasn’t going into anything but I was just so happy to be in our own bubble and living our own lives. We were there for a few months when our life got unexpectedly turned upside down.
Getting On The Property Ladder; The Bank Of Mum And Dad
To cut a long story short, I found out I was pregnant with our first baby. It was only then that I really think it sunk in that we were going to have to make our living arrangements a lot more permanent. However, we couldn’t afford a deposit on a new house and Jamie and I knew the annex didn’t have the space we’d need to raise a child. That’s when conversations with Jamie’s parents began and we started to look at properties to buy. This came as quite a bit of a shock to me, and I always felt awkward talking about it, but I think that’s because I always knew that neither of my own parents would ever be in a position to help me financially. I just had to accept that I had been welcomed into this family with open arms and kind of put my own thoughts about money to one side for the sake of our whole future.
Coming To An Agreement
It’s Allowed Us To Live And Progress
- While some parents might loan their children an average of £24,346, the average “gift” from other parents is £32,101.
- The majority of parents offering the loan don’t formalise an agreement with their children. This is fine, but by failing to provide a deed of gift or letter of intent, this could legally put their children at risk!
- One in five millennial buyers agree a monthly repayment plan with most paying back an average of £500 per month for approximately 4 years – although 25% will be renegotiated due to change in circumstances.
Post Office Money and The Money Charity have created a ‘Bank of Mum and Dad’ conversation guide to help all parties involved reach a family financial agreement that will protect the relationship. You can read the guide here and it’s absolutely worth a look – I was really surprised at some of the numbers and found myself nodding along like a nodding dog ornament in the back of a car!
I’d love to know if, especially as a millennial, you’ve faced any challenges in getting on the property ladder and if/how you’ve overcome them.