Third of first-time buyers rely on bank of mum and dad
Around a third of first-time buyers receive help from family and more than half rely on at least two full-time incomes, as access to first-time home ownership has collapsed this century.
As many as 52 per cent of first-time buyers now rely on at least two incomes, up from just 40 per cent in the 1990s, and 54 per cent are tied into long-term mortgages lasting thirty years or more, according to building society Skipton Group.
The war in Iran has added to existing concerns over affordability in the housing market, as mortgage lenders pull deals at the fastest rate since 2022 and experts warn the conflict will hammer market confidence.
The age of first-time buyers is growing too, despite the increased reliance on the bank of mum and dad.
The average age of a first-time buyer in England has risen from 29 to 34 since the mid 1990s, driven by a collapse in the number of under-25s buying their first home, according to Skipton’s home affordability index.
While one in four people bought their first home under the age of 25 in the 1990s, only one in fifteen do so today.
The proportion of first-time buyers with children has fallen sharply in the last decade, from around a third to little more than a quarter.
Deposits are rising faster than wages, with the average household having to wait a year to save enough to buy its first home.
Affordability gains could be wiped out
The building society had forecast affordability to improve slightly towards the end of the decade, but Skipton has warned the economic fallout of the Iran war could wipe out these gains.
Even before the conflict broke out, around 40 per cent of potential first-time buyers were expected to face unaffordable housing costs over the next few years.
Stuart Haire, chief executive of Skipton Group, said the aspiration of homeownership has faded in recent decades, causing young Brits to lack independence and stability.
Gen-Z adults are three times as likely to be living with their parents than the same age group was a decade ago, with 68 per cent of current 23 year-olds residing at home, according to UCL research.
Haire said: “With fewer people buying in their twenties, there’s a growing dependence among first-time buyers on two full-time incomes or help from their parents.”
A recent report by the Royal Institute of Chartered Surveyors (RICS) found that a quarter of property professionals recorded a fall in new buyer inquiries in February, up from 15 per cent the month before.
Tom Bill, head of UK residential research at Knight Frank, said: “Demand had been recovering after the uncertainty caused by November’s Budget, but the Middle East conflict will dampen sentiment during a traditionally busy period for housing transactions.”