Half of first-time buyers under-35 get financial help from parents
The Bank of Mum and Dad now funds one in two house purchases among under-35s, according to Legal & General.
The financial giant found that 56% of first-time buyers aged under 35 received financial support from their parents to help them step on the housing ladder.
In 2020, parents will play an active role in 73,160 property purchases among those aged under 35.
Nearly three-quarters (71%) of these new homeowners would not have been likely to buy without financial help from family or friends. Instead, they would have to delay their housing plans by four years on average.
One in three expect support
The research follows earlier findings from Legal & General, which showed that the Bank of Mum and Dad is stepping in to support loved ones as the economic impact of COVID-19 takes hold. A third (33%) of all people looking to buy in the next five years plan on getting financial help from family or friends.
Nigel Wilson, CEO at Legal & General: “The Bank of Mum and Dad’s role in Britain’s housing market is ubiquitous. Across the UK, parents, grandparents, family and friends are digging into their pockets to help young, hopeful buyers and even growing families to make their housing plans a reality. These generous lenders are often funding most or all of the deposit buyers need to step onto or up the ladder.
“But while the Bank of Mum and Dad is playing a clear and present role for many buyers, it remains a symptom of a broken housing market. Thousands of people simply don’t have a Bank of Mum and Dad to rely on. For those that do, generous family members are still having to draw on retirement savings and rainy day funds even as the country experiences its most significant economic challenge since the Second World War.”