Over a third of first-time buyers now rely on gifts or loans from parents in order to get on the property ladder, research by the Social Mobility Commission has found. A further one in 10 benefit from inherited wealth.
The proportion of those turning to the so-called "bank of Mum and Dad" is now at an historic high of 34.1 per cent, up from 20 per cent seven years ago.
The results of the study have been slammed by former Labour MP and chair of the commission Alan Milburn, who said “The way the housing market is operating is exacerbating inequality and impeding social mobility.”
First time buyers who received parental help were able to buy a home an average of 2.6 years earlier than their counterparts who did not benefit from similar arrangements. For Londoners, the gap was wider, setting those whose parents cannot help them 4.6 years behind their peers.
Researchers predict that the number of first time buyers will rise slightly in the short term, then fall over the next 25 years. If economic activity weakens, the proportion of first time buyers relying on parental support could rise to nearly 40 per cent by 2029. However, if economic activity increases, that proportion could peak by 2022 before falling again.
Lead author of the report, Dr Paul Sanderson of Anglia Ruskin University, said: “Going forward, the gap is likely to continue between those in the UK who can acquire that most significant of financial assets, the family home, and those who cannot. Only better-off young people and those who have parents who have already accumulated housing wealth are likely to be able to consider home-ownership without radical changes to the housing market.”