Borrowers feel guilty about using the Bank of Mum and Dad

More than half of potential first-time buyers expecting financial help from family to complete their purchase would feel guilty about doing so, new research reveals.

According to Yorkshire Building Society, 66% of 18-40 year olds expecting financial support feel guilty about receiving help from their parents or other family members to purchase their first house.

The report found that three-in-five (59%) would-be homeowners expecting to receive handouts from parents or other family members in order to buy a property.

Around a third (31%) expect to receive financial help with their deposit, in line with the proportion (29%) of first-time buyers in England who received support with their deposit last year.

Almost four in five (82%) of these young adults expecting to receive help to get onto the property ladder believe it’s unfair that their generation is finding it harder to buy their first home compared to their parents’ generation.

The majority (59%) of those expecting support are concerned that by accepting help it would negatively impact their parents’ future finances.

The study of nearly 1,000 aspiring first-time buyers was conducted by the National Centre for Social Research.

The survey also revealed how 14% of adults aged 25-40 expecting help from family anticipated the value of the support they received to be more than £40,000, compared to just 5% of 18 to 24-year-olds.

David Robinson, national intermediary sales manager at Accord, said: “In what is a tough environment for young aspiring homeowners, the ‘Bank of Mum and Dad’ continues to support young peoples’ dream of buying their first home.

“But while it’s clear that parents are willing, where they can, to help their children get on to the property ladder, the burden of how it could negatively impact their family’s finances is leading many young adults to feel guilty about accepting help.

“There are many parts of the country where average house prices dwarf earnings. Many first-time buyers turn to a broker for advice, so our survey results may help to remind them of the financial and moral dilemmas first-time buyers face when they help a client take their first steps on the property ladder.”

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