Parents spending billions supporting children who can’t afford to buy
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Parents are spending £20.1 billion each year supporting adult children who can’t afford to buy their first home.
The latest quarterly First Time Buyer Index, published by specialist bank, Aldermore, reveals that wannabe buyers living at home will cost their parents an average of £416 extra a month on food, drink, petrol and electricity bills, equating to nearly £5,000 a year.
With 4.02 million UK parents with adult children currently living at home, this adds up to an estimated total of £20.1 billion each year. Nationally, a third of parents (33 per cent) have had to sacrifice saving for retirement as a result of the additional costs involved.
In the East of England – which includes Hertfordshire - over a quarter (26 per cent) of aspiring first time buyers are currently living with their parents.
A quarter (25 per cent) strongly agree that buying a home is unachievable for them at the moment, while 21 per cent are planning to use parental or family assistance for their deposit – rising to 27 per cent for those looking to buy in London.
Charles McDowell, Aldermore’s commercial director - mortgages, said: “First time buyers have a notoriously difficult time getting on the property ladder. Since saving an adequate deposit remains the biggest obstacle, more and more people have had to move back into the family home to boost their savings.
“Our report reveals just how difficult this can be to navigate, with real impact not just on parents’ finances but also on the relationship with their children and their own ability to save.”