Is it normal for parents to give kids deposit?

[splendidisolation]

Just wondering what's "normal".

Re parents giving adult kids money for deposit on a house.

I read this a lot on MN and it kind of surprised me.

Is this the norm?

Do they give all the deposit?

Even if they're not minted?

Your experiences/thoughts please!

My mum charged me board as soon as I was working at 16. Every month that many that she told me was going towards the bills she actually was saving for me to go towards a deposit.

I plan on doing that with mine when they are older!

Money not many

My parents gave me a good chunk of money towards the deposit on my first flat. I'd certainly like to do the same for our kids one day - if we are in a position to. That will depend on how much we need to help with uni fees, our health/pensions etc but in principle yes. Much rather give money towards that or a business venture than a big wedding.

A colleague and her husband have been working 7 days a week saving for their 24 year old precious snowflakes 20k deposit on a 4 bed 3 bath house for just herself for the last 18 months..because she has her heart set on it.
And you know, you do it for your kids don't you.

Meanwhile, precious snowflake has gone to Spain for a week because she is SO stressed from all the questions the man from the bank was asking about her outgoings which she doesn't have because mum & dad pay for everything, phone, car loan, food,clothes (only designer will do) holidays.

Bonkers situation, bonkers.

The problem with wanting your DC to have independence and stand on their own two feet is that the rent/mortgage balance in many areas is so hopelessly out of whack that if you stay paying rent you’ll never be able to save for a deposit, whereas if you manage to get a mortgage you’re suddenly massively better off. A deposit in that case is a huge investment, not just in the conventional sense but because it saves you from haemorrhaging money on rent. Similarly I’d never buy my DC a car “just because” but if I was living in the middle of nowhere and it enabled them to get a job/stop bankrupting themselves on buses then it’s a no brainer if I could afford it either as a gift or a loan.

I think by the time you add up the family members who’ve given help with deposits, and the ones who’ve given tens of thousands of pounds of help by letting children live with them rent free to help them save or provided thousands of pounds worth of free childcare then that’s the majority of first time buyers accounted for.

Personally we were lucky enough not to need any help from relatives with deposits when we bought, but my DSis would never have been able to afford to buy a flat without significant family help because she and her DP are in less lucrative career paths. That support was the difference between their current comfortable (but not luxurious) lifestyle, and her struggling to make ends meet and facing housing insecurity until the day she died. It doesn’t seem to have damaged her strong work ethic or given her a massively sense of entitlement. The relatives in question have apparently adjusted their wills to reflect the help they gave DSis to make things “fair” in the end between the two of us, which is nice of them though I wouldn’t have felt strongly about it if they hadn’t - she needed help and they gave it.

I think it's not so much become "normal" as becoming almost impossible for young people to buy without family help, at least in London and much of the south-east.

DSS bought a house in Brighton because the £40k trust fund he inherited from his grandmother at the age of 5 had become over £100k when he was 21. The GPs weren't rich, but she had never put her income into the family pot, just squirrelled it all away.

One friend got given £20k from her parents (they had inherited a house from each of their own parents) to add to the £10k they'd saved for a wedding, but their wedding was done on a shoestring.

Another friend's DP's parents offered them the choice of a big wedding or £30k for a deposit, they opted for the deposit. My friend's parents had already paid off all her student loan with their inheritance, so they'd also managed to save £20k and bought a flat in east London.

I only know one person who's bought without parental help before they were 40, and she's done it by working really hard, living like a pauper (she hasn't had a holiday in 9 years) and saving like mad. She's buying a tiny flat in quite a rough area of Sussex and it's £150k.

DSS won't need an inheritance from us, so we hope to be able to help DGD eventually. She's only 2, so we're planning ahead for her and any future DGCs.

My son saved for 15 years for the deposit for a flat and I gave him an extra £10,000. He is finally buying a two bed flat at 35.
Rent is so exorbitant where he lives you cannot rent and save all at once and as he did so well I felt obliged to help him out.

I can't even afford a deposit to buy a house for myself let alone my children 😮🙁.

I shall be buying a house soon with deposit saved by myself and boyfriend. It's taken ages to save. I worked extremely hard, got better paid jobs, sacrificed a few things. We live in a shit flat to keep the cost down so we can put more towards our deposit. Mum and dad will not be giving us anything towards it. They did, however, after seeing how hard it is to get on the ladder, offer to lend us 20k, but we'd need to pay it back with interest. Though I appreciated the offer, because I want to show other people that it can be done without parental help, I declined.

We've given DD and her DP 7k and her DP's parents gave the same. Towards a house that cost £140k. They were both wasting money on 2 separate rents.

DH was given enough to buy a house outright by his parents.

My parents didn't give me anything but bought me a dishwasher. However I'd had a sizeable inheritance which more than covered the deposit.

My best friend was given £30k deposit by her parents and they also paid £10k towards her wedding.

So 2/3 here - I wouldn't be told or ask amongst any wider circle

Why do you care if it's "normal" or not? FWIW am planing to give both kids chunks of money as I'd rather they have it now than when I'm gone and they have debts (student loans) that I never had. But we are lucky as we have it to give (or we will when I've saved a bit more, heh).
Others may think/do differently. One can't prescribe.

In my husbands world yes, it's normal
In my world, no, my mum could never have afforded it

DH's parents gave us the deposit for our house but they're minted. My parents are/were skint so I would never expect it of them. In fact, I didn't expect it from PILs either, nor would I expect any of the parents to pay for weddings - done it twice, paid ourselves twice. But PILs really wanted to give us the deposit, plus it's a tax break for them, and it means we could afford a nice home for their grandkids, so we accepted.

No deposit for first flat.

If I have the money by the time my children are older I will help them out.

The way we afforded our places is to save and save and save. We were saving like crazy. We have had four 'jobs' between the two of us, mine for 12 years and DH for 7 years. We have been paid well but we also keep our living costs down. Yes we own two buildings but we are paying $3200 a month (£2200) for our unit. That includes building insurance, property taxes as well as repaying the mortgage. We were paying $2200 a month in our first place.

We don't need a huge home and I'm happy to share a building. With childcare we use the government run program which is full of kids whose family qualify for free childcare. It's also one of the cheapest daycare centers in town. We save $700 a month using them.

My parents remortgaged their home to lend me a deposit of £25k. I have to pay the interest which isn't much at all. I bought a house that needed work so I could pay them back. I paid them £20k in the first 2 years and will pay the rest back in the next year or two.

From why I gather, you can help but don't want to. The problem with that is salaries when you bought were probably more realistically aligned with house prices. This is no longer the case. If you want to force, your children to save up a deposit and sit there with prices potentially going up by 100k over the 3 years it takes to save the deposit only to once again see even a starter home out of their reach, that's your choice.

Dh and I will choose differently. We were given a sum from both sets of parents. Then lent some from my side as my mother and stepfather wanted us to buy a 2 bed instead of a 1 bed but only wanted to give enough deposit for a 1 bed. So we took the money and paid them off within 2 years.

Surely if you don't want to give it, you can lend it, can't you?

There's standing on your own two feet, paying your own way and there's getting screwed over by capital barriers.

Someone I know, who works hard at a very worthwhile job, has never been able to buy a house in the absence of family help because she couldn't save the deposit. I estimate that help to the tune of 10k would have made the purchase feasible for her. Over the years, the absence of this initial 10k has forced her to pay out about 200k in rent, for which she has nothing. If she's been in a position to pay part of that 200k upfront, she'd have had her own little flat some time ago.

If you can avoid that kind of trap for your kids, who are otherwise hard working, why wouldn't you ?

I don't know anyone who has bought in the South East during the last ten years without help from parents/ family. £50,000 seems a typical figure (often from both sets of parents) and far higher gifts not uncommon.

The amateur economist in me wonders whether first time buyer type places have market prices based on the family contributions which so many who buy them will have.

My parents gave my brother and I money for a deposit in the early 90's. We were both renting in London at the time.
It's made a huge difference to our lives. I hope we can do the same for our children when they need it.

I agree that in some cases, it is the marginal amount that makes the difference.

Often people are a certain sum short and a gift or loan of that amount makes the different e which then has a cumulative effect over the years. KIrsty is absolutely right.

For me, it was the £10k my parents lent me which enabled me to get a 2 bed place, which then meant I could let a room and the mortgage became affordable. I have known others who were perhaps £10k short of the deposit and by the time they save it,mor ices had risen £40k and they missed the boat....more than once in some cases.

I agree that people should expect to save and work hard for a deposit and not totLly rely on handouts or loans from family. However these days,me fen with lots of hard work and saving, help may still be needed to bridge the gap. As a parent, I'd like my kids to show that hard work and if they had, I think I would help...perhaps matched funding?

I'd be interested to know from the people on this thread who had loans or gifts from family, how much they had saved themselves as well. I wonder if in light of the high house prices some people are so discouraged by them that they don't actually save because the end goal seems so unachievable......so they keep going travelling or buying gadgets. I maybe totally wrong.

Back in the day, I saved a 12% deposit and my parents matched it. I then took the max mortgage I could receive.

If they can afford it, why not.

My parents didn't contribute to my deposit in a house, but they helped in other ways - DIY etc.

I have been putting money away every month since my DS was born (he is 12) so he will have some help towards a deposit on a house.

My parents lent me part of the deposit (£6,000) which I repaid over the next 3 years.

In my experience (early 40s) only a few if my friends were given money. Some had a minimal 'gift' - upto £5k max I would say, I don't know anyone including those who bought in London having been gifted £50,000. That's an insane amount of money, especially if you have more than 1 child.