Santander research has found the ‘Bank of Mum and Dad’ is still playing a key role in their offspring’s first property purchase.
It found current homeowners have received, on average, half of their deposit (49%) from their parents or their partner’s parents.
The study from Santander Mortgages shows 68% of parents who provided money to help their children get on the property ladder will get nothing back in return as it was intended as a gift. 72% of females were gifted the monies by their parents, in comparison to only 62% of men.
29% received the money as the equivalent of an interest-free loan while only 3% contributed towards their children’s deposit as an investment.
For those that are yet to buy their first home, the average amount they look to receive from parents is £17,900. With the average first-time buyer deposit being just under £25,000 this represents a 71.6%t subsidy. 22% estimate that their parents will contribute £20,000 or more.
34% 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.
“The mortgage market is still competitive, with options available to suit most budgets. Our range of Help to Buy mortgages offer competitive fixed and tracker rates to buyers with a 5% deposit and our 1I2I3 Current Account also gives 1% cash back on mortgage payments.”