'Bank of mum and dad' leaves borrowers feeling guilty

  • New research reveals 66% of 18-40 year olds expecting financial support feel guilty about receiving help from their parents or other family members to purchase their first house.
  • The number of young adults in the UK expecting any help from the ‘Bank of Mum and Dad’ is double the number who received support with their deposit in 2016.
  • Four in five first-time buyers expect support from parents to total less than a 10% deposit on the average UK first home.

The concept of the ‘Bank of Mum and Dad’ is growing in importance but more than half of potential first-time buyers expecting to receive financial help from family to complete their purchase would feel guilty about doing so, new research reveals.

The latest First-Time Buyers Report by Yorkshire Building Society shows 66% of UK adults aged 18-40 expecting to receive help from family to get their foot on the property ladder would be remorseful about leaning on financial support from the ‘Bank of Mum and Dad’.

Findings from the report show that relying on the ‘Bank of Mum and Dad’ is becoming the norm, with three-in-five (59%) would-be homeowners expecting to receive handouts from parents or other family members in order to buy a property. Around a third (31%) expect to receive financial help with their deposit, in line with the proportion (29%) of first-time buyers in England who received support with their deposit last year [i].

Almost four in five (82%) of these young adults expecting to receive help to get onto the property ladder believe it’s unfair that their generation is finding it harder to buy their first home compared to their parents’ generation. The majority (59%) of those expecting support are concerned that by accepting help it would negatively impact their parents’ future finances.

The study, which was conducted by the National Centre for Social Research, involved a survey of a nationally representative UK sample of 18-40 year olds to examine the attitudes and concerns first-time buyers have towards buying their own home.

While the average property price for first-time buyers in England is £198,325 [ii], meaning a 10 per cent deposit would set aspiring homeowners back nearly £20,000, four in five respondents (80%) expecting help from parents and family expected the total value of this support to be less than this level.

The survey also revealed how 14% of adults aged 25-40 expecting help from family anticipated the value of the support they received to be more than £40,000, compared to just 5% of 18 to 24 year olds.

Simon Broadley, Senior Manager at Yorkshire Building Society, said:

In what is a tough environment for young aspiring homeowners, the ‘Bank of Mum and Dad’ continues to support young peoples’ dream of buying their first home.
But while it’s clear that parents are willing, where they can, to help their children get on to the property ladder, the burden of how it could negatively impact their family’s finances is leading many young adults to feel guilty about accepting help.
There are many parts of the country where average house prices dwarf earnings. Our survey shows how the financial and moral dilemmas facing first-time buyers remain acute regardless of whether they are fortunate enough to have parental support available.

Despite angst over family support, findings from the Yorkshire’s report demonstrate how young adults remain optimistic about the prospect of owning a property, with almost two thirds (65%) believing it was likely or very likely that they would become homeowners, and more than half (56%) admitting they are currently saving money to buy their first property.

Aspiring homeowners also clearly still place importance on achieving their homeownership ambitions, with more than half (56%) saying that buying a property was “essential” to feeling that they had succeeded in life, compared to 63% in 2016. One in five (20%) reported owning a house is more important to them than any other life event, including getting married or having children.

The majority of those surveyed also believe owning a home would be good for their future prospects, with more than four in five (83%) saying they thought it would be a good financial investment. 

Simon added: “Despite the challenges facing potential first-time buyers, our results paint an optimistic picture and show how young adults in the UK still value owning their home, even going as far as to suggest it would be the most important milestone in their life.”

ENDS PR67-17

[i] Department for Communities and Local Government (2017) English Housing Survey: First Time Buyers, 2015-16 London: DCLG

[ii] HM Land Registry  House Price Index, December 2016 



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