Bank of Family lending on the rise as first-time buyers ask for help
Research from Legal & General’s Ignite reveals the number of applicants reliant on gifted deposits was up by 10% in November.
The continued resurgence in first-time buyers looking to get a foothold on the housing ladder has seen a significant rise in borrowers relying on financial support from family members – the ‘Bank of Family’.
Latest data from Legal & General Ignite, the free mortgage research and sourcing platform for brokers, shows first-time buyers are increasingly relying on financial support from the ‘Bank of Family’, with searches for products accepting those with a gifted deposit seeing a 10% rise.
FINANCIAL SUPPORT
November also saw a further 12% increase in searches for gifted equity and concessionary purchases, highlighting the ongoing need for external financial support in the property market.
The data also shows portfolio landlords looking to increase their market share.
Searches related to ‘second residential property’ grew 29%, while brokers searching for HMO (House in Multiple Occupation) products increased by just under 20%.
Holiday let and Airbnb searches also increased slightly, maintaining their position among the top eight searches with a 1% increase.
NAVIGATE AFFORDABILITY
Kevin Roberts, Managing Director, Legal & General Mortgage Services, says: “As the property market continues to evolve, it’s clear that first-time buyers are driving significant momentum, seeking support from the Bank of Family to navigate affordability challenges.
“The data from Legal & General Ignite also highlights the resilience of the overall mortgage market, with diverse trends among portfolio landlords and a sustained interest in capital raising, even during these uncertain times.”
But he adds: “Affordability does remain a persistent concern though, reflected in the notable level of defaults and missed mortgage payments, as well as the continued reliance of first-time buyers on the support of family and friends.”
Earlier this year, research and forecasts from Legal & General and the Centre for Economics and Business Research (Cebr) found that financial support from the Bank of Family is expected to help fund 318,400 housing transactions in 2023.
