Almost 320,000 homes will have been bought using financial support from family members this year, according to forecasts by Legal and General. Cash totally £8.1 billion will support 47% of homes purchased by people under 55, says the financial services group.
The figures reveal that more buyers are being helped by the bank of mum and dad than in any period since Legal and General began tracking such transactions seven years ago.
Buyers in London are particularly reliant on the bank of family, with more than two-thirds (67%) receiving an average of £30,200 in support to fund their purchase.
Most buyers, who used parental help, said that without it they would have needed to put their home ownership ambitions on hold. A fifth of buyers said it would take them five years to save up enough to get on the property ladder, with 10% believing they would not be able to buy at all.
Bernie Hickman, chief executive of Legal & General Retail, warned that while family gifting has always played a part in the housing market, it can place a strain on savings, pensions and the retirement income of the giver. People thinking of helping a family member to buy a home should get financial advice he said.
Buying and selling at the same time?
Here are 10 things that could go wrong, and often do go wrong, and what, if anything, you can do to avoid them.
Buying and selling at the same time?
Here are 10 things that could go wrong, and often do go wrong, and what, if anything, you can do to avoid them.
“Our latest Bank of Family research shows just how the high cost of housing, particularly in London and other major cities, continue to shape the UK.”
He added: “Gifting a deposit is an incredibly kind and generous thing for those who can afford it, but it shouldn’t be a necessary part of the home buying process.”
Read more about this story on the Property Wire website.
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