Despite a growing reliance on the Bank of Mum and Dad, over half (53%) of parents of 18-35-year olds are not willing to take financial advice to navigate the mortgage market. This is despite the fact 38% of parents surveyed said they were unaware of the major four specialist mortgage products for new buyers, said the Halifax.
Nearly a third (32%) of parents questioned said that they are both willing and able to financially support their children’s purchase, although many may not have been fully aware of all the options available, said the bank.
Only around one in five parents (21%) have heard of guarantor mortgages, and just over a quarter understood that a mortgage could have multiple applicants such as friends and family to spread the monthly costs.
CML data on affordability reveals that monthly mortgage payments as a percentage of monthly income, currently 28%, are below the long term trend of 34% average over the past 25 years.
Although, just 18% of parents view the current economic environment as an opportunity to take advantage of lower rates and prices, just 8% of those whose children have not stepped onto the property ladder are concerned about slow house price growth so wouldn’t invest in their child’s first home at the moment.
Stephen Noakes, Halifax’s commercial director for mortgages, said: “Whilst it’s important that first-time buyers understand everything that is involved in buying a home, for many parents getting a better understanding of the state of the market and the range of products available today may make a difference to homebuyers and parents alike.”
