When it comes to buying houses, our ability to relate to older generations wanes. Millennials (and even 'Generation Y') have grown up accepting defeat when it comes to financial independence; difficulty in finding jobs (and holding on to them) and the acknowledgement that it will be near impossible to step a foot on the property ladder is our reality.
Us Londoners, especially, laugh at the prospect of ever winning the keys to our own place – we can barely afford a shoebox room in Zone 3 (even when we're sharing with housemates/a partner). Our destiny is renting until we are inevitably priced out altogether.
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While the housing situation is bleak, ‘Generation Rent’ (as we are so called), have become almost desensitised to the onslaught of bad news upon bad news when it comes to housing. However, new depressing statistics have slashed our hopeful ‘on day things must turn around’ singsong. As reported by Cosmopolitan UK, the organisation Shelter has worked out the salary first-time buyers need to be earning at this very moment in time if they want to buy a house by 2020. You might want to sit down for this.
The organisation has estimated that first-time buyers need to be earning £64,000 a year if they hope to own a house within in the next three years. Ouch.
Currently, the average UK salary is £27,600 according to the Annual Survey of Hours and Earnings (ASHE). Even if you can’t do the maths, you can see that this is less than half what Shelter estimate we need to be earning.
While UK house prices do vary wildly in different places, the stats are based on UK-wide averages. When the salary predictions were first released last year, Shelter’s Chief Executive Campbell Robb said: ‘When house prices are increasing six times faster than the average wage, it's no wonder people on ordinary incomes are being locked out of a home of their own.’
Shelter’s director of policy, Anne Baxendale, said: ‘When house prices are so out of step with wages, it’s no surprise that people are finding it near impossible to make the leap from renting to buying.’
‘It doesn't have to be like this,’ she told Cosmopolitan UK. ‘Rather than scraping around for second rate solutions, we need a whole new approach to housebuilding in order to deliver high quality homes that people on ordinary incomes can actually afford.’
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