Your family's fortune: 'We bought our first home for £40,000'

Younger generations are finding it harder than ever to get onto the property ladder. 

With the average house price in the UK now sitting at just over £280,000, research has shown that it now costs first-time buyers 191% more than their parents back in the 1990s. 

This has led to 28% of 20 to 34-year-olds returning home to live in 2023, and it’s therefore little wonder that more parents and grandparents are stepping up to help younger generations out. 

But just how much has the challenge (and adventure) of buying your home changed over the years?  

In the first of our new series, telling the stories of house buying across the generations, we speak to Victoria and Ana, mother and daughter from Horsham. 

We get their perspective on buying, selling and affording their dream homes – and the worries they have when it comes to owning property in the future. 

Victoria, 58: “Our generation has seen our kids ‘boomerang’ back home while they save for a house” 

“I was 21 when Andy (my boyfriend back then, now husband) and I bought our first home for £40,000. It was tiny, with one bedroom and a hanky-sized garden, and you couldn’t swing a cat.  

“At that time, we were both earning around £6,000 a year and we didn’t have anything new. Our furniture, crockery and cutlery all came from our parents. 

“I wouldn’t say it was easier for us in those days, but it was different. Every month, I would check everything from my cheque book against my bank statements and we’d have £5 left over. That would be for our treat: a Chinese takeaway. 

“Three years later [in 1989], we bought our second house and the Bank of England base rate went up to nearly 15%. We were earning £18,000 between us, and our mortgage was £800 a month for a two-bedroom, open plan house - it became unfeasible for us to keep it. 

"We sold up and moved near to my family in Devon, but we couldn’t make a life down there because there were no jobs for us.  

“So we ended up moving back and living with Andy’s sister in Hertfordshire. I was temping at AstraZeneca and he got a job refuelling at Gatwick, so we could make the move to Horsham.  

“We got married and moved to the three-bedroom house where we are now. It cost £92,000 in 1995, which I think was a good price, and now it’s worth nearly £600,000. 

“Things have always been tough, mortgage-wise. We still haven’t paid off our mortgage, but that’s not the end of the world. I know younger people are taking out 30-year mortgages now. 

“That length wouldn’t worry me because, every time we move, we’ve extended ours - so if you look at it, we’ve had a mortgage for more than 30 years anyway. 

“We’ve had both of our children living with us at various times. As much as I love them, I do like having the house to ourselves and now they both live nearby so we still get to see them lots.

“House prices are so high it’s impossible to buy on your own now. You have to have a partner because you need to share the cost, but I don’t think that’s too different to when we started out. 

“I’m sure if you spoke to our parents’ generation, they’d say they had it hard too. In a way, we were lucky because we didn’t do so much shopping and we couldn’t afford to go out, so we had friends over.  

“I do worry about this generation financially because we were lucky to have company pensions and I think with big mortgage payments it’s harder to save for retirement. 

“When my mum died we paid out a fortune on Inheritance Tax, but now I feel like we’ll be able to live comfortably and give the children some inheritance.  

“We’ve said to them: we’ll live our lives and there’ll be money left in the property, but nothing’s certain. What if one of us needs the money to pay for care?” 

Ana, 27: “Buying a house on your own is impossible for people our age” 

“Matt and I have been together for eight years and we bought our first house four years ago. We’ve been incredibly lucky because Matt’s mum gave us an early ‘inheritance’ we could use as a deposit. Without that, we might not even be moving into our first house yet. 

“Before we bought the house, we were living between both our parents’ homes. We were so ready for our own space, especially Matt, who was constantly packing and always carrying an overnight bag, which he hated. 

“If I was single at this age, there’s no way I’d have been able to buy. Right now, I’d say I’m making good money, but buying somewhere on your own is [still] impossible for people our age - you have to do it with someone else. 

“I only have three friends who’ve bought their first house – the rest are renting and living at home and we’re close to 30 now. I do feel lucky, because if I was on my own, I’d still be living with my parents. 

“The deposit is the biggest barrier for my friends, along with the high cost of living. Building up savings is impossible when you need £50,000 or more for a deposit.” 

“How can you own a car, live your life and save that much? It would take forever. People say to give up little things like takeaway coffee, but if I did that, I wouldn’t get a house until I was 150,” says Ana. 

“My parents gave us advice when we first moved in, and the best thing they told me was to get a house that needs a bit of work so you can make it your own. 

“We would have loved to buy in Brighton, but even with a deposit we couldn’t afford it, so we bought a detached two-bedroom house with lots of character in Burgess Hill. It was for sale for £320,000, but we got it down to £317,500 and then we needed to decorate.  

“We were lucky because we had a low mortgage rate at that time and then when it came to selling it was during Covid when houses were in demand. 

“A year ago, we bought our second home to move closer to family in Horsham, which was around £600,000. It’s definitely an investment and I think we’ll be here for a while. 

“When we were looking for the second house, there was another one where the owners had done everything to it, so we went for the one that needed a bit more work. There was a shed on the side of the house we didn’t use, so we built an office there instead. 

“We borrowed the most we could over the longest amount of time, but I don’t worry about having a 30-year mortgage.  

“I spend more than a third of my income on mortgage and bills and I try to save a third. We want to enjoy our money now and have some funds later in life too.  

“I’m putting what I can into my pension, but if the mortgage was less I would do more. We don’t go out as much now we have the house, but if I had more money I’d like to update my car. 

“When gas and electricity prices went up our bills tripled. I’m quite a cold person so I need the heating on during the winter - that was definitely coming out of our ‘enjoyment’ money.

“It’s great to have our own house, but we have the best of both worlds because I live a few minutes away from Mum so I can pop back home to see her. I’m happy to be living back in Horsham.”