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one in five homeowners but are taking their second step property ladder Are receiving financial support from family or friends, new research indicates, The enduring role of the ‘Bank of Mum and Dad’ in the UK housing market is highlighted.
While 30 percent of first-time buyers reported receiving such support barclays‘The Property Insights report found that this trend extends to 20 per cent of people moving to their second home.
First time buyers receiving this support received an average of £76,239, While ‘second steppers’ achieved an even higher average of £81,451 for their home purchase.
Notably, nearly three in 10 (27 percent) homeowners who received financial assistance for their second or third property also reported benefiting from assistance for their first home.
This vital support typically comes in the form of outright gifts from parents, inheritance, or loans provided by family members or friends.
Nearly half (52 percent) of tenants surveyed also said it would be impossible for them to buy a home without an inheritance or loan from a family member.
One in six renters (16 percent) said they plan to buy a property in the next year, but more than two-thirds (68 percent) of these potential home buyers said property prices are a barrier to achieving that goal.
Six in 10 (59 percent) also said they were struggling with “moving goalposts,” moving savings goals to keep pace with rising home prices.
Jatin Patel, head of mortgages, savings and insurance at Barclays, said: “Our latest data highlights a market in transition. While first-time buyers are often thought of as the main beneficiaries of mum and dad’s bank, the reliance of second-stage buyers on family support underlines the impact of cost-of-living pressures on all sections of the market.”
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Julien Lafargue, chief markets strategist at Barclays, said: “With the Budget now published, there has been improved clarity allowing economic actors to start planning ahead. For the property market, this should mean a greater level of activity as we head into the new year.
“That said, affordability remains a challenge that can be addressed through a combination of lower interest rates, more Accommodation availability, and financing innovation.”
Barclays commissioned Opinium Research to survey 2,000 people across the UK in November and December.
Anisha Beveridge, head of research at property firm Hamptons, said: “The Bank of Mum and Dad is no longer just a lifeline for first-time buyers – it is increasingly supporting second and even third stage buyers too.
“Upsizing has become significantly more expensive in recent years, mainly because house prices have increased much faster than flat prices.
“Traditionally, homeowners borrowed more to cover the higher purchase price and stamp duty bill, but with mortgage rates still high, increasing affordability has become far more difficult and more expensive.
“As long as rates remain above the ultra-low levels of the last decade, family assistance looks set to become a more permanent fixture of the housing market.”