By the end of 2017, Britain’s Bank of Mum and Dad will have helped to buy homes of an added value of £75bn, as parents are loaning £6.5bn to their house-hunting offsprings.
New research by Legal and General and combination with Cebr has revealed that 25% of property transactions in the UK are now being funded with parental help.
The expected total of loans of £6.5bn is a significant increase from last year’s £5bn. This puts the country’s mums and dads on one level with the Yorkshire Building Society, Britain’s 9th largest mortgage lender.
The ones getting most support from their parents are millennials, as the report reveals that 79% of funding goes to those aged 30 and younger.
Nigel Wilson, CEO of Legal and General, said:
“Younger people today don’t have the same opportunities that the baby-boomers had, including affordable housing, defined benefit pensions and free university education.”
Almost 40% of Londoners receive help from their parents, with the amount mum and dad were willing to contribute varying drastically depending on location.
Overall, England’s South West saw parents most willing to chip in with an average of £30,000. London followed closely behind with average parental support coming up to £29,400.
Welsh home buyers were least able to rely on support from their parents as financial help average at £12,500.
In addition to this, some siblings seem more likely to get the full support than others as only 40% of parents stated they would support all their kids equally and 18% actively choosing to only help old the eldest offspring.
“Parents want to help their kids get on in life, and the Bank of Mum and Dad is a testament to their generosity, but it is also a symptom of our broken housing market.”