The “Bank of Mum and Dad” will help fund one in four property purchases this year – but is starting to feel the pinch, according to new research.
Figures from Legal & General and economics consultancy Cebr suggest young homebuyers are growing increasingly reliant on their parents to help them get onto the property ladder.
Research shows 27% of buyers will receive help from friends or family in 2018, up from 25% in 2017.
Mums and dads will help 316,600 loved ones buy a home – an increase from 298,300 in 2017, according to projections.
However, while parents remain a major lender, they will be handing over less cash, the report said.
The average amount they are expected to contribute towards a property purchase is expected to decline from £21,600 in 2017 to £18,000 this year.
Total lending will dip from £6.5bn last year to £5.7bn in 2018.
Nigel Wilson, group chief executive at Legal and General, said: “The Bank of Mum and Dad remains a prime mover in the UK housing market, and will lend the best part of £6 billion to buyers this year, with over 315,000 transactions being underpinned by parental help.
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“However, it’s clear that households are feeling the pinch, as (Bank of Mum and Dad) contributions have reduced by an average of 17% from nearly £22,000 to a still very generous £18,000.”
The research involved surveys and analysis of existing figures, including HM Revenue and Customs (HMRC) house sales reports.