Bank of Mum and Dad widening gap for first-time buyers

First-time buyers who get parental help are younger and buying more expensive homes than people buying without assistance.

According to figures from UK Finance, first-time buyers who are given parental support are aged just over 30 on average and earning £56,000 on average.

By contrast, those buying without support are typically aged over 32 and earning around £65,000 on average.

Higher earners getting less expensive homes

Although people purchasing without financial support usually have higher incomes, they appear to have less buying power than those who rely on the Bank of Mum and Dad.

Despite assisted buyers generally earning less, they’re buying more expensive properties, worth £317,846 on average.

That compares with £279,381 for people who aren’t getting help.

This is partly because family support is enabling some first-time buyers to put down larger deposits.

Across the UK, people getting help from their family are putting down deposits of £118,073 on average.

But those who are buying unassisted are putting down deposits of £60,741 on average.

This gap was found to be largest in London.

Figures showed that first-time buyers in the capital who had parental support put down an average deposit of £224,054.

Meanwhile, a first-time buyer purchasing without financial help puts down an average deposit of £145,133.

Family wealth a bigger factor than earnings

The findings suggest that family wealth is a more decisive factor than how much a person earns when it comes to buying a home and what type of property they’re purchasing.

But UK Finance believes the increasing dependence on parental help could be storing up problems for the future.

“While most first-time buyers are still managing to purchase without help, growing reliance on family support risks deepening inequality in the housing market,” said head of analytics James Tatch.

“A balanced approach that tackles both supply and affordability is crucial to keeping homeownership within reach for all.”