‘Bank of Mum and Dad’ feels the squeeze
The average amount contributed by parents towards home purchases has fallen by 17 per cent over the last year, according to Legal & General (L&G).
While buyers who received assistance from their parents in 2017 enjoyed an average contribution of £21,600, those receiving assistance this year can expect an average contribution of £18,000. This equates to a fall in overall lending from £6.5 billion last year to £5.7 billion this year.
In contrast, the firm says that it expects 27 per cent of home buyers to receive assistance this year, a rise of two percentage points on last year’s figure.
This means that around 317,000 housing transactions in 2018 will receive input of some sort from the parents of the buyers.
Nigel Wilson, Chief Executive of L&G, said: “People are feeling a bit of a pinch around the economy and therefore we’re seeing pretty much a national trend outside of London for less to be given.
“The volume of transactions depending on Bank of Mum and Dad funding keeps on growing, even as parents find it harder to provide as much money for the deposit”.