The mortgage market has seen record levels of demand from consumers since reopening after lockdown, and even with fewer high loan-to-value mortgages available, many first-time buyers are looking to get their housing plans on the move. A growing number are turning to the Bank of Mum and Dad (BoMaD) to give them the help they need, our latest research reveals. Even with the economic uncertainty caused by the pandemic, more property purchases are being funded by loved ones in 2020 (23%) than in 2019 (19%).
Our new report reveals that more than half of first-time buyers under the age of 35 receive financial support from BoMaD, equating to more than 73,000 property being supported by loved ones. These first-time buyers benefit from an average of £19,000, but some receive much more: 21% of respondents under 35 receive more than £30,000. All of this adds up £1.36 billion in BoMaD contributions in 2020, helping loved ones purchase £18.11 billion of property.
But benefitting from these financial contributions isn’t specific to the under-35s. In fact, 61% of BoMaD’s lending in 2020 (£2.14 billion) is to help those over 35 – in part due to the fact that these first-time buyers tend to be looking for larger, more expensive properties – and will support 30,000 more property purchases in this age group than for those under-35.
Without financial support from loved ones, far fewer property purchases would be possible. Some 71% of under-35s say that if it weren’t for this, their purchases would be delayed by an average of four years; for those over 55, one in 10 would have had to delay their purchase.