Gap between Renting & Buying closing

[BoatBoy]

It smells like subprime doesn't it?

I have a few examples close to home of the kidults rushing out to buy a first home far far far fancier than anything we would ever have had as a first home, or as a home now, or as a home ever.

Those high paying jobs will be there forever and as 17 to 20 year olds, they've worked hard and deserve all the luxuries of life first up, and of course they wont listen to anyone with the runs on the board, what would they know?

Some people are just kidding themselves, recession, what recession?

Dave

 

[BV]

I have a few examples close to home of the kidults rushing out to buy a first home far far far fancier than anything we would ever have had as a first home, or as a home now, or as a home ever.

Dave

It sounds so much like my 25yo son...
He wants the best and he wants it now....
many of these kids could be in for a rude shock

 

[Propertunity]

I see this a lot with Gen Y.

Mum and Dad's place that they are moving out of is just a starting point for them - won't accept anything lower. In most cases it took Dad & Mum 25 years and possibly 3 - 5 house upgrades to get to their kidult's starting point.

I am confident many of these Gen Y's will be renting for many years to come.

I was pleasantly surprised over the week-end to meet a FHB who is quite prepared to start on the first rung of the ladder and do a reno as she can afford it.

 

[auror]

It sounds so much like my 25yo son...
He wants the best and he wants it now....
many of these kids could be in for a rude shock

Just wanted to comment on the above two posts. My partner & I are both under 25 and we wanted to buy a modest 2 br apartment for our 1st PPOR. It was our parents who convinced us to buy something big (as we could afford it) so that we wouldn't have to move as soon as kids came along

We bought a fantastic house in the end, considerably above budget but will take us 12 years to pay off in full.

I still think it's too big for us and feel a little guilty about owning a big house at our age... but we were influenced into doing so by our parents! Not all ppl 25 year olds & under have a want-it-all mentality

 

[BoatBoy]

It was our parents who convinced us to buy something big

Its your money, you should be responsible for your own decision and not buckle to peer pressure on this sort of decision.

We bought a fantastic house in the end,

well done

considerably above budget

Ah................. flasher than required then, and considerably above budget

but will take us 12 years to pay off in full.

cool

I still think it's too big for us and feel a little guilty about owning a big house at our age... but we were influenced into doing so by our parents!

Don't pass the blame, if there is any.
At the end of the day it was entirely your decision to go big and fancy now

Not all ppl 25 year olds & under have a want-it-all mentality

Totally agree, not all, but a lot, just need to go through any new estate on a weekend to see evidence of this.

But, if you got yours and you can afford it during a downturn, well done.

Dave

 

[auror]

Not passing the blame, everyone (including parents) very happy with purchase (bought at significant discount). You're right though, I need to take more ownership of our actions

 

[Casserole Dish]

Good idea buying with babies and kids in mind, however, once they come along life gets very expensive....

We started in a small house, had 2 babies in a small house and have clawed up to a bigger house now on one income.

I can't start to tell you how expensive these little humans are, just remember to factor that all in. Unless ofcourse you are holding off until the house is paid (12 yrs you said?) BUT the flipside of that is I personally recommend having babies young if you can as I tell you what, it's exhausting.

Sounds like the parents are itching for grandkiddies as well so the pressure will be on...

 

[auror]

Aah yes - paying for bringing up kiddies, good point Well the 12 years figure was based on our salaries this year (and assuming a constant salary over the next 12 years)... hopefully future pay rises will be enough to accelerate our repayments or fund the kidlets.

 

[eggnog]

Aah yes - paying for bringing up kiddies, good point Well the 12 years figure was based on our salaries this year (and assuming a constant salary over the next 12 years)... hopefully future pay rises will be enough to accelerate our repayments or fund the kidlets.

and future IR hikes may be enough to deccelerate your plans. Note that we are in the lowest IR for at least 40years so basing projections on current IR is not wise.

 

[BV]

and future IR hikes may be enough to deccelerate your plans. Note that we are in the lowest IR for at least 40years so basing projections on current IR is not wise.

Good point CFP
Hopefully we will be able to fix our loans before IR's go up

 

[Y33]

Although the gap may shorten between buying and renting there will always be those that rent.

auror,

Try putting $50 a week a side now into an account and get use to the idea of that is probably the minimum you may have to spend during the first year when bubs comes along. If you do this for a few years then you will have enough money to cover most cost for the first year or two. My better half and I decided we would spend a few years just us only and put our selves in a secure financial position before having kids. Now I'm able to stay home with the baby everyday without worrying about whether there will be enough money to go around.