Report: Support for first-time buyers
Support for first-time buyers
In order to investigate the pressures that families are facing in terms of housing, Shelter commissioned NatCen Social Research to provide research on the assistance that first-time buyers receive. They assessed the level and extent of the financial contribution that parents make in order to help first-time buyers fund deposits. The research revealed the following:
Parents contribute an estimated £2 billion per year, in the form of gifts or loans, to help fund first-time buyer deposits.
Almost 40% of first-time buyers in the years 2009-13 received assistance from friends or family in order to purchase their first home.
The proportion receiving assistance from their parents has increased over time. Since 2009, 27% of first-time home purchases with a mortgage were purchased with parental assistance compared to just 17% in 2005-8.
Of those first-time buyers that received assistance from their parents, the average value of the gift or loan received was £17,000, compared to their average deposit which was £28,000. This means that parents were contributing more than half of the value of the deposit necessary for the purchase.
This report is part of Shelter’s ongoing work to look at every element of the housing crisis in the hope of fixing it for good. It is clear from this report that parents are having to contribute more and more in order to get their children on the housing ladder. If they are not able to (and we know that, in the last decade, levels of home ownership fell for the first time since records began), then this will place even more pressure on other areas of the housing market. People at the sharp end of the housing crisis – those in overcrowded accommodation, those facing eviction or repossession – will feel this more than anyone. At Shelter, we offer advice and support to people in those positions every day, but we can only fix these problems in the long term and ease the pressure in the system for good if we look at the root causes of our housing crisis – like the lack of homes throughout the country that people on low to middle incomes can afford.