In 2016 the Bank of Mum and Dad will lend over £5bn, provide deposits for over 300,000 mortgages and help purchase £77bn worth of property in the process.
The so-called Bank of Mum and Dad is now the equivalent of a top 10 mortgage lender in the UK and will be involved in a quarter (25%) of property transactions this year, Legal & General research shows.
In 2016 the Bank of Mum and Dad will lend over £5bn, provide deposits for over 300,000 mortgages and help purchase £77bn worth of property in the process.
Nigel Wilson, chief executive of Legal & General, said: “The Bank of Mum and Dad plays an increasingly vital role in helping young people take their early steps on the housing ladder.
“But the generosity being displayed by UK families doesn’t make up for intergenerational unfairness – younger people today don’t have the advantages the baby-boomers had, including cheap housing that delivered windfall gains. People will always want to help family members – it is a natural thing to do.
“Relying so heavily on the Bank of Mum and Dad however risks increasing inequality as many young people today are not lucky enough to be able to access parental support when buying a home, or can’t afford to buy even with parental help.
“We have a supply-side problem in housing – we are simply not building enough houses. We need to build more, especially as the Bank of Mum and Dad could soon start to experience a funding crisis of its own.”
