According to the Office of National Statistics, there is a 20 per cent increase in 20-34 year olds living with their parents since 1997, an increase of half a million. Meanwhile, the number of 20-34 year olds has remained fairly stagnant.
First Direct said that children living at home long past the age they should can take solace in the fact that there are bargains to be found.
The average UK rental price for a one bedroom property hit £1,050 per month in July 2012 and First Direct claimed that if rents continue to climb at the same rate seen over the last year (3.69%), the average could reach nearly £1,260 by 2017.
First Direct pointed out that home rent is likely to be cheaper, while not paying utilities, insurance or tax could save almost £4,000 per year. These savings could be put towards saving to buy a house, with First Direct predicting as much as £60,000 could be saved over five years through rent, bills and furnishing costs.
However, it isn’t just children that can benefit, with some mortgages enabling parents to use rent from their children in order to make overpayments, reducing the term and cost of a mortgage.
According to First Direct, if a child was charged £500 per month to live with them instead of renting their own place a parent could reduce the terms on their mortgage by around four months and save over £1,000 in interest in the first year alone.
First Direct senior product manager Ian Bartholomew said: “If both parties can manage to get along, older children returning to the family home can be a great idea. It can help children save for a deposit to buy their first home more easily and parents can save money and reduce the amount owed on their mortgage.”
