First time buyers receive half of deposit from parents
And more than two thirds of mums and dads who stump up the cash to help their children onto the property ladder offer it as a gift meaning they get nothing back in return, the report from Santander Mortgages found.
However, almost three in 10 first time buyers receive the money as the equivalent of an interest-free loan while only three per cent of parents contribute towards their children’s deposit as an investment.
Women are more likely to be gifted the money by their parents than men and for those yet to buy their first home, the average amount they look to receive from the ‘Bank of Mum and Dad’ is £17,900.
With the average first-time buyer deposit coming in at just under £25,000 this represents a 71.6 per cent subsidy. Some 22 per cent estimate their parents will contribute £20,000 or more.
A third (34 per cent) of those who have children yet to buy a home say they will contribute money towards a deposit in order to help them on to the property ladder.
Miguel Sard, head of Santander Mortgages, said: “Raising a deposit can be a huge challenge and our research shows that many rely on financial help from their parents in order to get a foot onto the property ladder. Buying your first home can be a daunting but there are ways to make it easier and support is available to help first time buyers with upfront costs.”