The Great Millennial Housing Divide: The Renters Vs the Owners

From bitter comments to fallouts and awkwardness, the bank of mum and dad is creating new class divisions.
housing generation rent parents inherited wealth mortgage
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Peter* spent his gap year like many white British 18-year-olds of a certain class: travelling around India, eating thalis and visiting temples. While away for the year navigating Rajasthan, Himachal Pradesh and Uttar Pradesh, his life changed – somewhat without his involvement. He’d finished his A Levels, secured place at a good uni back in the UK, and now, landed a nice flat in north London. Peter had remotely become a homeowner, alongside his older brother.


“It was a slightly odd situation," he tells me over the phone, because all the decisions were being made in his absence – "so I wasn't really involved. Then it was just a really weird moment of, ‘Oh my God, I suddenly own a lot of money and property.’” But, when speaking now to people he knows, “I am so closed about my house,” he admits. “I can't bear telling new people that I own property because I've done nothing to deserve it.”

Today, we face what feels like a great generational housing divide: those who’ll be trapped in an oppressive renting market, trying to sneak a glance over the wall at those who’ve received the unimaginable gift of lifelong financial security in the form of bricks and mortar. According to a survey by financial services group Legal & General, parents are giving their kids so much money for houses now that the “bank of mum and dad” is considered equivalent to a major mortgage lender. While a 2018 report claimed that one in three millennials will never own a home – forced to flush their cash away to anonymous landlords (cruelly, for around the same amount as a deposit), those who win the birth lottery may be given homes. Suddenly, the ‘generation rent’ anxiety facing an entire age group doesn’t apply to this rather quiet sub-set.

Speaking of which, Peter and his brother eventually sold the north London house, and with some money from his grandma, bought a different property in east London, where he lives now. “I do find it hard to negotiate in friendships,” Peter tells me. “Knowing that I own property has made the choice of lifestyle, of being a writer, kind of easier. I've got that safety net of wealth meaning I don’t need a mortgage. It's made certain things different – not in a tense way or super negative way – it's just a difference that has led to our lives going differently. Most of my friends are accepting and wouldn't judge me for owning property, but it just means that your priorities are different.”


As I enter my late twenties, the implications of London’s housing crisis grows more evident. And that's not through my yearly increasing rent or interactions with evil landlords, but on a more personal basis with my mates. Many of them have been given houses by parents, pulling the financial chasm between friends to an unimaginably vast yawn. Inevitably, this can cause friction, arising from the awkwardness of a two-storey dead giveaway of your secret wealth (with a garden!); or on the flip side, the bitterness and jealousy that inevitably comes from a friend charging you £525 a month for just being a poorer flatmate than them.

Charlie Thomson, who also lives in London, found that owning property young can change the way you’re perceived around friends. Charlie’s mother remortgaged her house to give him enough for a deposit, and he’s owned a two-bed flat in south-east London since he was 22. He's been paying off the mortgage since he moved in. “When I first did it, I was very reluctant to tell anybody,” he tells me over the phone. “There’s the constant chatter going on, not just on in the media, but in offices and on the bus and in university lectures, about just how expensive property is. So I was reluctant to disclose that I was in a position to basically buy a flat at 22.”

It’s impacted some of his friendships, as well as his self-perception. “People even say, ‘ooh, get Charlie, he's a big player, he's a big baller’ or ‘he's got his shit together’, which is sometimes difficult when you don't feel like that yourself. On the whole, it hasn't affected all of my relationships badly, but it's definitely affected a few. I felt that people see me in a different light.”


Sally McCormack, 25, found herself in a slightly different situation to her 16-year-old mates when she inherited a house in the Midlands after her father died. “I do feel weirdly guilty about it, but I suppose it's how most of our generation will end up affording a house – it just happened to me 30 years earlier than it happened to other people,” she says over the phone. “It's weird that I have a house but someone had to die to give it to me.”

Despite the added element of a bereavement, it still affects how friends behave around her: “There are definitely people who are more bitter about it. My close friends are completely lovely, but there are fringe friends who find out and are a bit like, ‘ugh’.”

This housing crisis has invigorated a new corner of the British class system, allowing those with capital to accelerate while their peers with less inherited wealth may flail for decades in a cycle of moving costs, vast deposits and rising rents. Historically, owning a home slipped a ticket to social mobility directly into your palm; it felt like something you could do with £10,000 after five years of work. For our generation, that vaguely achievable aspiration pulls further out of reach. We don’t have a way out of this stranglehold the way our parents might have. What’s more, as with most British discussions over money, there is a willing vagueness around the source of that cosy three-bed your 25-year-old mate mysteriously just moved into. We don’t talk about it, instead, swiftly changing the subject, or even posting gleeful (yet misleading) Facebook posts claiming to be “so excited for the new house!!” with no hashtag declaring #thanksforthe90kdepositdad.


So, how does that feel on the other side of the divide? Watching your mates suddenly excel financially thanks to their wealthy parents (if you’re lucky enough to know that’s the reason) can, at the least, be frustrating. At worst, it can damage a friendship.

Jack* found that renting from a school friend whose parents gave him a house (paid-for outright) created tensions in their relationship. So much so that they stopped talking for a while after Jack moved out. For the first few months, things went well. "It definitely strengthened the friendship in some ways,” he begins, “but there was also the tension of unspoken issues that come with every living partnership. Looking back, I likely projected my feelings of discomfort that stemmed from my friend's ownership of the space.” Jack started to feel like his friend had more rights to their shared space, to the TV and so on. “When you know it’s someone else’s property you eventually feel like you’re intruding.”

After moving out, the two friends needed some distance from each other. “After a couple of months we started meeting up again,” Jack says, “and things went back to essentially the same as before. I think in the end it comes down to how the owner-friend handles the renting process and the attitude of the renter. I didn’t feel this, but If you do feel constant resentment at their good fortune and owning something you don’t believe they deserve it’s always going to cause antagonism.”


Sometimes, the stress of having friends with so much more financial stability than you can have worse consequences than just damaging a friendship. Ryan McCann, now in his early thirties, felt inadequate watching his friends all progress faster than he was without really knowing why. This led to feeling distant from certain friends, not being able to talk honestly about financial difficulties, and eventually, mental health problems.

“Through my mid to late twenties, I started to feel really shitty when people working in the same industry as me and in roughly the same jobs seemed to be getting paid a lot more than me,” Ryan tells me. They all dressed better, went on flashier holidays, he remembers, and he felt like a failure. “It seemed like most people I worked with were doing better than me.”

It was a while before Ryan realised that the disparity wasn’t to do with his own lack of success – it came down to family money: “I literally ended up depressed and on meds as I couldn’t figure out why my life wasn’t progressing like theirs,” he says. “I really could have done with people being more honest about the parental help they got, rather than never mentioning it, making it seem like a level playing field.”

While a blend of politeness and ignorance can disguise the source of parent-funded properties, we've really found ourselves in this position thanks to an out-of-control housing market in London and the south. In a sense, we’re sleepwalking into an unprecedented intergenerational divide. Millennials are statistically poorer than previous generations. Britain still prizes property as a main source of social mobility, so where does that leave the young people who can't afford to step onto the property ladder in the parts of the country that raised them? In the meantime, emotions ebb and flow between friends. Peter still feels “totally guilty” about it, he says. “It’s such a mad thing – I haven't done anything to deserve this and it's just been handed to me on a plate.”

*Some names have been changed