A recent report by Legal & General and the Centre for Economics and Business Research has concluded that the “bank of mum and dad” is now the equivalent of a top-ten mortgage lender in the UK. Parents in the UK contribute an average of £17,500 to buying their child’s house.
The research shows that parents will lend more than £5 billion this year, providing deposits for more than 300,000 mortgages and helping to purchase homes worth £77 billion. On average, parents or family contribute £17,500 to a child’s house — about 7 per cent of the average purchase price. Nigel Wilson, the chief executive of Legal & General, said that such a model risked increasing inequality, because “many young people are not lucky enough to be able to access parental support”.