The results of our “First-Time Buyers” research for the Yorkshire Building Society have been published today. Our nationally representative survey of 18 to 40 year old “potential first-time buyers” found that:
- The majority (59%) of first-time buyers expect help from the “Bank of Mum and Dad”
- The vast majority (80%) of these expect the help they will receive from parents to be less than £20,000 – the cost of a 10% deposit on the average price of a first home in England
- Two thirds (66%) feel guilty about accepting help from the parents and wider family
Recent research has highlighted the difficulties experienced by young people trying to get onto the property ladder. Evidence from the English Housing Survey has shown that home ownership is in decline for young people, with just under four in ten young people aged 24-35 owning their own home in 2015-16, compared with over half in 2005-06. Intergenerational inequality in home ownership was also highlighted in a recent Resolution Foundation report. They found that “Millennials” (those born in 1981-2000) are significantly less likely own their own home compared with “Baby Boomers” (those born in 1946-1965). In 2015, research by Shelter found that it would take a couple with children twelve years to save a 20% deposit for a house, and a single person without children thirteen years
In the face of these difficulties, our research found that young people still aspire to own their home, but a reliance on “the bank of Mum and Dad” is now the norm. Two thirds of young people aged 18-24 want to own their own home in the future with a similar proportion believing that they are likely or very likely to do so in the future. And it’s not just wishful thinking; over half of those aged 18-40 are currently saving to buy a house, although three in five potential first-time buyers think they will need help from “the bank of Mum and Dad” to make their first step onto the property ladder.
Some young people are worried about accepting this financial help to buy a property. Around three in five voice concerns about how help from “the bank of Mum and Dad” might affect their parents’ and family members’ finances. Young people are concerned about the financial burden they are putting on their family, with two thirds feeling guilty about accepting help. Furthermore, young people expect the current trend of intergenerational dependence to continue, with roughly two thirds expecting to help their children or other family members buy a house in the future.
Feelings about getting help from parents and other family members (%)
The current housing market presents significant challenges to potential first-time buyers. Although half of potential first-time buyers are saving to buy a house, a significant proportion expect that they will need help from their parents to get onto the property ladder. However, young people are accepting this help begrudgingly, whilst being wary about the financial impact help from the “bank of Mum and Dad” might have on their families.
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