The housing difficulty young people face getting on the housing ladder is highlighted in a new survey which found 40% of parents worry their children will never be able to buy a home.
According to Gocompare.com Money, the average age parents expect their children to leave is 25, while just over a quarter (26%), don’t think their kids will leave home until over the age of 26.
A fifth of parents think their children have a better chance of inheriting a home than buying one.
While many first-time buyers rely on the Bank of Mum and Dad to help towards the cost of their home, almost a quarter (24%) of parents said that they were unable to offer any financial help at all.
Just over half (51%) said they would like to help, but doing so would leave them short of savings. Just 19% said they could comfortably afford to help their children buy a home.
In order to help increase their prospects of home ownership, over a third (34%) of parents would suggest that their children move to a cheaper area, while 9% said they would go as far as to encourage their kids to emigrate and buy abroad.
While the outlook for their children’s home ownership prospects might be bleak, when one door closes, another opens.
Nearly half (48%) thought their children should go and see the world before worrying about buying a home while 21% would tell their children to rent instead of buying.
However, 23% of parents admitted that knowing their children may never be able to afford their own home left them feeling angry.
Matt Sanders, from Gocompare.com Money, said: “There are a variety of explanations why many twenty-somethings are not financially independent from their parents and continue to live under the same roof – sometimes well into adulthood.
“Young people are more likely to stay in full-time education than previous generations, and while they benefit from a university education, tuition fees mean they are saddled with more debt. Over the last decade or so, house prices have risen as have the size of mortgage deposits lenders require – however wages have remained relatively static. As a result, Millennials’ experience with home ownership has been very different to previous generations.
“Millennials keen to fly the nest could benefit from a tax-free Lifetime ISA. Available from April 2017, Lifetime ISAs can only be opened if you’re between the ages of 18 and 40 and are designed to help the under 40s put cash aside for either their first house or a pension.
“Savers can contribute up to £4,000 within a tax year, which will then be boosted with a Government bonus of 25% – but only if the money is used to buy a first-home or for retirement from the age of 60. So, savers paying in the maximum allowance in one year will earn an extra £1,000 tax free – or to put it another way, £1 is added for every £4 saved.
“A Lifetime ISA has to be held for a year before you can put your savings towards the cost of your first home. This means that anyone looking to buy within the next 12 months could consider taking out a Help-to-Buy Isa where the savings bonus is paid out on completion.”
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