Pocket money to purchase a property?
According to Shelter, one in five parents surveyed have had to dip into their retirement funds to help their children take their first step onto the property ladder. It was revealed that around £2 billion worth of contributions were made by parents in a year to help their children purchase a home.
Since 2009, 27% of the UK’s first time buyers have had to rely on their parents for financial support to raise a deposit compared to 17% in the previous 4 years according to Shelter. The housing charity also found out that the average amount contributed from parents to child is £17,000. To put this in perspective this is over half of the yearly national average wage for a deposit.
Parents are not always finding it easy to help their children with one in five parents taking money from their retirement fund and cutting back on their own spending. Shelter has also revealed that it takes couples an average of 12 years to save up a deposit for a home which rises to 30 years for a property in London.
This is highlighting the seriousness of the current state of the housing market where the generation rent is likely to extend. The resolution is pinned on the Government building more affordable housing before even more young families, single people and couples are priced out of the housing market. The chief executive of Shelter, Campbell Robb has said that there is, ‘something seriously wrong when people who work hard and save each month and still have no hope of buying a home without significant financial support from their parents.’
Have you had to borrow money from your parents to put a deposit down on your house?
Amanda McGovern, Pali Ltd
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