- 42% of first-time buyers are receiving help from their parents
- Thousands of first time buyers taking a second job to get a property
- 43% of first time buyers have thought about giving up buying altogether
Bradford & Bingley’s third annual First Time Buyer Report (based on the UK’s biggest survey of first time buyers), reveals that just when many parents should be enjoying a golden retirement thousands are raiding their savings and having to contribute to their children’s mortgage to help them get on the property ladder. Some are even putting off retirement and re-mortgaging; whilst others are making changes to their lifestyle.
50% of parents helping their children will give them the deposit for their first home; nearly double the number who were giving, or lending their children a deposit one year ago. One in ten first time buyers receiving assistance are buying jointly with their parents, or relatives.
| Ways in which parents are helping |
% of those helping |
| Will give/gave deposit |
50% |
| Withdrew money from their savings |
24% |
| Help with payments |
17% |
| Act as guarantor |
15% |
| Buy jointly with you |
10% |
| Made changes to their lifestyle e.g. had cheaper or less
holidays |
4% |
| Remortgaged their home |
3% |
| Retired later than planned |
1% |
| None of these |
12% |
*this was a tick all that apply question
Two Job Culture
First time buyers aren’t all relying on their families though as one in ten are so desperate to get on the property ladder that they are taking a second job to make it possible. “Two jobbers” are working on average just under 12 hours extra per week. Others are working longer hours in their main job with nearly one-quarter (23%) working an average nine and a half-hours overtime each week to enable them to buy sooner.
| Government Region |
% of FTBs with a 2nd job |
| North East |
10% |
| North West |
12% |
| Yorkshire & The Humber |
15% |
| East Midlands |
5% |
| West Midlands |
18% |
| East of England |
12% |
| London |
7% |
| South East |
10% |
| South West |
8% |
| Wales |
12% |
| Scotland |
9% |
| Northern Ireland |
13% |
First time buyers are not only working longer hours but also making sacrifices to their lifestyle in order to save harder. Of these 55% are spending less going out to bars, clubs and restaurants and 26% are cutting back on mobile phone bills, TV subscriptions and gym membership.
Help with additional costs of buying
Not only are families paying deposits but nine per cent are paying the other costs involved with buying such as stamp duty, legal fees and surveys. Eleven per cent of those first time buyers making changes to their lifestyle to get on the ladder move back in with their parents to avoid paying rent. Parents might think that when their children finally get the keys to their property they no longer need to help but 14% are also given furniture.
Duncan Pownall, Bradford & Bingley’s mortgage development manager said: ”The message we are getting from our Report’s findings is that many first timers are prepared to compromise, work hard to save for a deposit and look to their families for extra help if needs be. As house prices continue to rise families are having to help more to get the next generation on the property ladder.”
Bradford & Bingley’s tips for first time buyers: -
- Do your research before you go househunting
- Do make the most of being chain-free when negotiating and don’t get pressurised by the vendor, or estate agent
- Do ask questions about anything you don't understand - the experts are there to help you
- Don’t buy anything that looks like it needs work if you don’t have the budget to do it up
- Do stick to your budget and avoid additional costs
Despite the huge amount of help being given by families one fifth are still taking four years, or more to get on the ladder and 58% are having to compromise on their first property. Nine per cent of those compromising move to another area of the country and four per cent buy in a different area from where they live and let their property out just to get on the ladder.
Duncan Pownall continued; “Home ownership is one of the nations top aspirations. Whilst 43% of first timers we talked to have at some stage thought about giving up buying they have all since bought, or are looking to buy this year.” Pownall continued; “Most first timer buyers have to strike a balance between how much they want that expensive holiday, or new car and how soon they want to have the keys to their own property. As house prices, council tax and utility bills rise banks are responding by coming up with new products specifically for first time buyers that look at what someone can afford to borrow rather than the old fashioned income multiples.”
ENDS
For further information please contact: Bradford & Bingley Press Office:
Mandy Pursey
Jessica Bigus
Sharon Keller
| tel: 020 7067 5645 |
tel: 020 7067 5647 |
tel: 020 7067 5634 |
Notes to editors: -
*This was a tick all that apply question so answers do not add up to 100%
- YouGov on behalf of Bradford & Bingley carried out research amongst a representative sample of 1,536 first time buying adult’s aged 18+. Surveys took place between 2nd and 9th March 2006.
- First time buyers were defined as those who had either bought in the last 12 months or are planning to buy in the next 12 months.
For further information about how first time buyers can get onto the ladder and details of Bradford & Bingley’s products for first time buyers including special offers log onto www.bradford-bingley.co.uk/firsttimebuyers.asp