We don’t have to tell you just how expensive buying your first home is… According to Savills, the Bank of Mum and Dad gave away a total of £9bn throughout 2022, which is a rise of almost £4bn since 2019.
Their report stated that 170,000 first-time buyers (46% of all the first-time buyers in 2022) received financial help from their family.
Savills also mentioned they expect this number to rise by over 60% in 2023, pointing out that if this does occur, only two in five first-time buyers will purchase their first home solo. The report says that both higher mortgage rates and the end of the Help to Buy scheme as being the main factors for this.
However, while the number of first-time buyers receiving help from the bank of Mum and Dad is expected to go up, the total number of first-time buyers is likely to reduce to 200,000 in 2023, according to Savills. Savills also predict that the total amount of money provided by family members will likely fall as well, but is still expected to total £26bn over the next three years.
Savills director of residential research Frances McDonald said: “Since the Help to Buy scheme was introduced in 2013 it has supported more than 335,000 FTBs – providing £2.2bn of financial assistance in 2022 alone (bringing the total support received by first-time buyers to more than £11bn).
“With no obvious scheme expected to replace the support provided, a far greater proportion of buyers will be relying on family members to help them to take their first step onto the property ladder.”
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PLEASE NOTE: Article written 17th March 2023. Information contained within this article is likely to change and therefore should not be relied upon or form part of any form of decision making without seeking professional advice. *
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Any guidance and/or advice contained within this document is subject to the UK regulatory regime and is therefore restricted to consumers based in the UK. Any technical or regulatory information contained within this document was correct at the time of producing it but as it may be subject to change it should not be exclusively relied upon when making a financial decision. The Financial Conduct Authority does not regulate advice on Buy to Let mortgages.
Article written: March 2023 170323 MZ000269
