No matter what age you are, there is always a good argument for turning to your mum and dad for support. There is definitely a great deal to be said for the support, advice and guidance provided by your parents but of course, it may be that the most support your parents give you is financial support. This is why a lot of people are happy to say thanks to their parents because the financial backing goes on for a very long time.
It is understandable that children and youngsters rely on their parents for money but even when people become of age where they can work for a living and start to bring in an income, there is a lot to be said for turning to the bank of mum and dad for support. Clearly some parents don’t have the means to provide this support to a child and some parents would prefer not to give money to their child, hoping to provide a harsh lesson that may set them up to work hard in everyday life. However, there are many occasions when parents provide fantastic financial support to their kids and the best support may actually come at the point when a child leaves home.
Parental support is always important
A child may leave home for a spell to go to college or university but there has been a trend in recent times of people staying at home for longer. There are many reasons for this but one of the key reasons comes with the fact that the cost of housing is so much these days that it isn’t always possible for people to afford to buy a home when they would like to. This means that they will stay with the parents for a longer period of time and this may actually convince parents that they are better off supporting the child to move out in order to get some freedom and space for themselves!
This has been backed up by a study which suggests that the volume of first-time property buyers who are turning to the “bank of mum and dad” for support is at an all-time high. This report was carried out by the Social Mobility Commission and their findings suggest that over a third of property buyers in England are reliant on money from their family. This finding was based on the most up-to-date official data, which relates to 2013/14, and it was found that 34% of first-time buyers are reliant on a loan or cash from their parents. This is a big jump from a figure of 20% which was the figure from 2010/11.
Inheritance wealth also being used to buy homes
Further proof that first-time buyers require assistance in buying a home comes with the fact that an additional 10% of buyers are using inheritance wealth to put towards their first home. This leaves you close to 50% of all first-time property buyers in England relying on family support or inheritance to get on the property ladder. There have been great strides in recent times with respect to Government support and mortgage lenders being fairer in their offerings but it is clear that many people are still reliant on assistance from loved ones to get on the property ladder.
If parents have the means to support their youngsters, they will but many parents aren’t in a position to do this, and this means that there is a major problem in the property market. This will further price certain people and people from certain areas and backgrounds out of the property market, which isn’t something that anyone is really in favour of.
If you are looking to buy a property soon it is vital that you examine your finances in great detail and consider what you need help with. If you are in a position of needing short term assistance to improve your finances, it may be that a short term loan like a guarantor loan will be of benefit or assistance.
If you aren’t in a position where you can receive financial backing from your parents, don’t despair but you do need to be honest about your finances and work hard towards achieving your aims and goals, particularly in the property market.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn’t sat behind a laptop or researching a story, he will be found watching a gig or a game of football.