Over half – 56 per cent – of first-time buyers under 35 who bought a house in the last five years benefited from family financial support, shows research from Legal & General.
It adds that, currently, the Bank of Mum and Dad is lending an average of £19,000 to FTBs in this age group, and that 21 per cent received more than £30,000.
In 2020, £1.36bn is forecast to be lend to FTBs from what is quickly becoming one of the nation’s biggest lenders.
Of those under the age of 35 who have received financial support from family, the majority – 71 per cent – said that if the had not done so, their purchase would have been delayed by four years on average.
And in what is perhaps one of the more striking statistics in the report, 9 per cent of people over the age of 55 planning to buy a house this year said that they too would have to delay their purchase if not for the BoMaD.
Legal & General adds that 61 per cent of all lending from the BoMad in 2020, or £2.14bn, will go to those over 35 years old, funding 101,800 transactions.
Meanwhile, the cohort under 35 is expected to make 79,631 BoMaD-funded transactions this year.
Overall, a third, or 33 per cent of all people who plan to buy a home in the next five years, will be looking for financial support form either family or friends, Legal & General adds.
Legal & General chief executive Nigel Wilson says: “While the BoMaD 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 [it] 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.
“We must address the UK’s ongoing housing crisis. Only then will we be able to tackle the issue of affordability. Britain’s housing sector is a critical engine behind the country’s economic growth and we need a strong property market now more than ever to drive the economic recovery from Covid-19.”
