Three in 10 mortgaged first-time buyers across Great Britain received family support towards their deposit this year and increasingly more are turning to brothers and sisters for help, research from Hamptons reveals.

Analysing data from Skipton Building Society the agency found that other family members beyond parents are increasingly lending their financial support to first-time buyers.

RECORD

So far this year siblings made up a record 11% of family members contributing to first-time buyer deposits, more than double the share recorded five years ago (5%) and surpassing grandparents’ contribution (8%) for the first time.

They gave an average of £10,250 to their sibling so far this year which comes against a backdrop of high inflation and rising rents limiting a first-time buyer’s ability to save for a deposit.

Parents remain most likely to gift money towards a child’s deposit, making up 72% of those lending support so far this year.

However, this share has gradually declined from a peak of 80% in 2018 as first-time buyers increasingly look to other family members for help.

MOST GENEROUS

Parents are also the most generous, gifting an average of £15,250 so far in 2023.

Aneisha Beveridge, Head of Research at Hamptons, says: “Is the bank of Mum and Dad running dry?

“As homeownership rates decline through the generations, younger parents today are less likely to be homeowners than their predecessors, which reduces their ability to withdraw equity from their home to pass on to children.”

And she adds: “First-time buyers are increasingly leaning towards other family members to boost their deposits. Siblings are at the forefront with older brothers and sisters at the more affluent end of the spectrum putting their hands in their pockets.

“They are highly likely to already be homeowners who want to help their younger siblings take their first step onto the property ladder.”

Elsewhere, more than half (52%) of prospective buyers say the current economic climate has impacted who they plan on buying a property with, and who they might have to share their property with, according to the latest research from Mortgage Advice Bureau.

Economic uncertainty, fuelled by high inflation and interest rates pushing rents and mortgage rates up, is the biggest barrier standing in the way of homeownership according to two in five (42%) homebuyers.

OBSTACLES

Saving for a deposit (32%), a slowdown in the housing market (27%), and being accepted for a mortgage (25%) also ranked highly as major obstacles.

Ben Thompson, Mortgage Advice Bureau Deputy Chief Executive, says: “The difficult and volatile economy has significantly changed the game for prospective buyers.

“For 15% of this demographic, it means they have already delayed homeownership plans.

“As high inflation levels dig deeper into people’s finances, many will be finding it incredibly difficult to stash away funds for deposits and subsequent mortgage repayments – especially those seeking to buy alone.”