The proportion of first-time buyers in England relying on the so-called “Bank of Mum and Dad” has reached more than 34 per cent, according to research for the government’s Social Mobility Commission.
In 2013 to 2014 34.1 per cent of first-time buyers received a gift or loan from their parents to buy a house.
Meanwhile a further 9.6 per cent relied on inherited money to get on the housing ladder.
The proportion of first-time buyers reliant on parental generosity has increased in recent years and the report said it is now at a historic high.
If economic activity remains at the levels in the commission’s baseline scenario for the next 25 years, the proportion of assisted first-time buyers will reach 40.6 per cent by 2023 to 2024.
The report stated: “As the parental contribution is, in part, counter-cyclical, the proportion helping their children in this way could remain at or around current levels even if macroeconomic fundamentals become weak.
“In any event, aspiring first-time buyers for whom family help is unavailable will most likely remain disadvantaged, even more so if their parents fall into the least educationally qualified category.
“Going forward, the gap will almost certainly be maintained between those in the UK who can acquire that most significant of financial assets, the family home, and those who cannot.”
The research also found that people are buying their first home later in life than their immediate predecessors.
In 1990 39 per cent of those aged between 20 and 24 years old were able to buy their own home but just over 10 per cent managed to do so in 2015.
But those receiving money or a loan from their parents could buy at a younger age than those who did not receive such help, the difference being some 2.6 years.
Analysis of homeownership levels among cohorts of young people since 1990 shows that while the percentage of those owning their own homes continues to rise as they grow older, no group exceeds the level of ownership of their immediate predecessors for any given age band.
Other forms of parental assistance found by the research included the sale of a property to a child at less than market price or inheriting a property in which to live, but these were insignificant in size.
damian.fantato@ft.com
