Telegraph article - ‘We gave our son £325k to buy a flat – or he would have been stuck renting forever’

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https://archive.ph/JujMC#selection-4141.0-4152.0

It found that this year, 42pc of properties bought by people aged under 55 will have help from the <a class="break-all" href="https://archive.ph/o/JujMC/www.telegraph.co.uk/money/sons-13000-more-bank-mum-dad-daughters/" rel="nofollow" target="_blank">Bank of Mum and Dad,* *equal to 335,000 transactions. By 2026 that will reach £11.3bn.

'His recent clients include Rick and Linda Denton, who rearranged their finances to free up £325,000 to help their 29-year-old son onto the property ladder.
The couple, both 63, were keenly aware that without assistance he and his girlfriend, despite both having full-time professional jobs, would be stuck in expensive rental accommodation forever.

Rick Denton knew his son would be stuck renting forever without financial help
Their gift has enabled their son to buy a two-bedroom flat in Denmark Hill, south London. Their 30-year-old daughter, a lawyer, was given a similar amount to buy her flat in West Hampstead, north London, three years ago.
“We felt it was important to give them a good start in life,” says Rick, who has worked in financial services, and is now an investor, company director, and entrepreneur. “We wanted to make sure they got through university debt free, and could buy a reasonable property in London. We didn’t want them bowed with debt.”
But equally Rick and Linda, who runs her own public relations firm, didn’t want to give their kids a completely free ride. Their son <a class="break-all" href="https://archive.ph/o/JujMC/www.telegraph.co.uk/money/property/mortgages/lloyds-offfers-first-time-buyers-mortgage-5-times-salary/" rel="nofollow" target="_blank">borrowed four times his annual salary to help pay for the rest of the property, with his girlfriend’s wages also factored in.
The couple, who live on Guernsey, were able to finance their contribution by dipping into their investment portfolio.'

Am I the only one who feels that if this continues, the young (who don't have Bank of Mum and Dad) might be totally demotivated (and that the rest of the UK would also become the inheritocracy that London is as there would be a ripple effect).

I did benefit from the inheritocracy too (parents paid my university fees/london rent for 3 years, DH and I had rent free living for 3 years at his mum's house in London), but definitely not to the tune of £325k. I am mystified as to why the son needed such a huge sum to buy a 2 bed flat (I also bought a 2 bed flat in my 20s) and the only other alternative to such a large sum would have been an existence in precarious private rental forever. They also paid his uni fees too so the parental subsidy from age 18 was much more than 325k. Apparently average gift to London FTB (cash gift) is 70k as of 2024.

The big difference now is that they are no longer the minority and wages are taxed at a far higher rate than wealth. Those with gifts are 70% of the first time buyers with the result that only 30% of my generation currently own their homes.

And the point is people don't need to earn good money to buy house if they get gifted a lot of money (effect is compounded)..so actually while the prices may not rise much in real terms, they may still be unaffordable.

inheritance gets taxed unlike these gifts. In fact they are taxed at 40% above 1 million.so this limits the amount of wealth that gets passed down..

There was a thread earlier where someone on 100k to 200k felt she couldn't afford london (no family help unlike me) and the overwhelming consensus was her to go to the north. OK so if everyone on 100k went to the north and traded in their 1 bed flats for houses, what happens to the people in the north. Are they going to earn 100k salaries to keep up too?

DH has been given money all his life, university fees, any trip he wants to go on, expensive hobbies etc. His parents have money through inheriting etc, they’re frugal too. We got given about £250k for a house deposit which has helped us enormously as we have a small mortgage now.

I’ve never had a penny from my family because they don’t have the same mentality. I had a house that I saved for and bought before meeting DH, I saved for it by living in houssshares, getting the bus etc. DH is absolutely terrible with money, he earns more than me and despite all the handouts I have more saved than him now!

If I had the money, I'd buy my daughter a house in a heartbeat. Why wouldn't I?

ETA: sorry, didn't mean to quote your post there.

I think gen z have it worst.

I once said on mumsnet that I got onto the housing ladder in London on a modest 75k combined and 3 years of living at home just 5 years ago (and had the budget to buy a 2 bed terraced in a place like slough or Wycombe or even hitchin). A mumsnetter corrected me and said a similar couple would need a £130k combined income today to get the same kind of budget/properties. She was unfortunately right. As the house in Slough is 450k today.

I don't think living in house shares and getting the bus is going to help someone get onto the housing market in many areas of the country. That ship has sailed, sadly.

Obviously not just a UK issue, but the baby boomers are probably the first peacetime generation in history to leave a tougher society to their children/grandchildren than the one they inherited.

And yet you still have the likes of the Daily Fail having a daily meltdown at comfortably off pensioners - who have enjoyed a lifetime of generous state benefits, free university, decent healthcare, affordable homes - missing out on WFA when millions of young people are being locked out of owning their own home for life.

I'm fortunate enough to have a housing association flat. Some private house shares in my area now cost more than I pay for my 2 bed flat. Insanity

I don't know anyone of my Peers who have been able to buy (all 30s and not in london) who did not receive any help from parents.
Some in form of inheritance but more just cash gifts and/or rent paid during early years.
For those of us with no prospects of that kind of help we just slept on and save on. Can't do much else.
I've seen it cause some friction in friendships where some have lied about it (not that they need to disclose anything to anyone but lying about it just makes others feel like crap)

I agree that who wouldn't want 100k free money. The thing I find most offensive about it though, that 2k you worked hard for - heavily taxed. The 100k you did absolutely nothing for - tax free.

Sadly I inherited nothing so everything I have was earned through hard graft. Took a mortgage out on a house myself. Lived hand to mouth for the first 2 years (couldn't afford to put the central heating on or take a holiday etc). In time I furnished it bit by bit. Over the years the pressure eased as my salary increased, I got married etc etc

I cannot think of a single reason why my children should not benefit from the fruits of my labour. If I can help them with a deposit I will. It's not taking anything from anybody - it my hard earned cash.

Totally my position too (I hope - mine are younger and so it will be a few years yet, at which point I should be in the position to do the same as you as long as nothing goes wrong).

That won't stop me feeling utterly depressed about the way things are going and the sheer unfairness that permeates our whole society at the moment, not least because while I may be the right side of the line and my children may, with some luck, just about stay the right side too, I can't see that being the case for any grandchildren and god save the generations that will come after that.

Plus who really wants to live in the kind of dog eat dog world we are becoming, even if you are doing better than those at the bottom?

It's great that you were able to save, however you are coming across as some who thinks 'young people can't afford a mortgage because they buy avocado toast and coffees).

House prices are insane. For most people, they dont have much left to save, even as a house share. Many people do need cars to commute, as they can't live near their workplace because it's too expensive, but no decent/similar job where they live. Public transport (especially trains) is largely unreliable and so expensive, many people opt to have a car so they aren't late for work 3 times a week.

Also, the money 'saved' on taking public transport instead of owning a car, comes nowhere near saving for a house deposit.

I'm 36, and bar 1, all the people I know that have bought a house, have had financial help.from their parents; living at home rent-free, being given money whilst at uni so they didn't have to work, being given deposits for a house, childcare, having their weddings paid for.

I agree that who wouldn't want 100k free money. The thing I find most offensive about it though, that 2k you worked hard for - heavily taxed. The 100k you did absolutely nothing for - tax free

The money given by parents to their children has already been taxed! Seriously - why should tax be paid again?

This is an absolute rubbish argument. The recipient of this money has paid no tax on it. By that argument, my cleaner shouldn't have to pay tax on the money I pay her with my already taxed income. Loads of money is 'taxed again'. I pay tax on my income. With the (already taxed) money left, I pay council tax, then I pay tax on any insurance I buy, then I pay road tax, and so on.
Also, it's very likely the money hasn't been taxed once, nevermind twice. If I sell my house, buy a small house, and give my kids 100k each, no tax would have been paid on that money.

I am not sure why a parent giving their child their money is even questioned. My friends all had their parents pay for their weddings, their first car and act as childminders while they worked etc. I had none of that. Bought my own car, had to pay nursery fees throughout and paid for my own wedding. I watched some parents pay thousands for their daughter's wedding dress alone!
Why do people suddenly question the fact parents help their kids buy a house but never question the other monies parents give to their children?

Either it's up to the parent what they spend their own money on or it isn't.

So both case I know of, in London, where the parents helped the first time buyers, it was a donation of 200k for one and 700k for the other. As second home buyers, my friend received around 600k from the in laws.

I agree, this is my position as well (minus the inheritance). We have created a world for our children were work doesn't pay and your chances in life are hugely dependent on how much money you are given, not that you earn.

This is an absolute rubbish argument. The recipient of this money has paid no tax on it. By that argument, my cleaner shouldn't have to pay tax on the money I pay her with my already taxed income

But your cleaner is working and is not one of your children. An irrelevant comparison.
By your reasoning you'd have to stop parents buying anything significant for their children. Some parents pay as much for their children's weddings than other parents give to help their child make a deposit on a house.

Now you either seem to need family money or a partner.

I've never been given money for a home. But I know a lot of people are. It creates a false sense of who can actually afford properties I think.

Typical Telegraph to feature such a wealthy family as though that is the norm! They have used PART of their investment portfolio, live in a hugely expensive place known for its wealth and have given their children the best part of a million pounds. Hardly typical!
DH and I had no financial help and, although we are now retired ourselves, are lucky to still have living parents so have had no inheritance We and our parents have helped our DCs onto the property ladder.
There is an increasing gap between those who have the advantage of help and those who don't. The only one of our DCs friends who has not yet bought, despite being on a similar wage to the others, is one of four children of a single mum who has struggled financially herself so cannot help them with a deposit.
My other concern, on a larger scale, is that this potentiates the North-South divide and the huge imbalance is not good for the country

You can't expect someone who can afford to buy a flat with their parents help not to buy a flat with their parents help

I guess cos a wedding dress or a car doesn't add to wealth. The financial benefits of Education, free childcare and even rent free living ultimately depend on the beneficiary's salary (which is taxed at 40% above 50k); I had my education paid for and DH didn't but ultimately he has always earned more than me (and his student loan payments have never been more than 400 quid per month and he has around 1k on his student loan balance; though we did have to overpay £10k in student loan repayments to reduce his balance). There are many people in London who live rent free with parents but can't do much with their good fortune due to low earnings.

Cash to buy a home is much more direct, a house is also a financial asset that appreciates. For many years it has outstripping median earnings. Housing is also a basic human need. When we price that commodity out of the realms of median earners, we are playing with fire.

Where have you got 30% from?
If you are 30 then your generation, like mine, is 'millennial.'
As of 2022 39% of 25-24 year olds were homeowners. As above, the millennial cut off is 26-44 (so 24-42 in 2022), so those are roughly the younger half of millennials. The older half are going to be more likely again to own, so well over 40% will own a home by now.
https://bmmagazine.co.uk/in-business/millennial-homeownership-reaches-12-year-high-amid-rising-wages/#:~:text=The%20IFS's%20findings%20reveal%20a,the%20highest%20percentage%20since%202010.

In 2023 only 50% of the whole population owned their own homes.
So millennials really aren't that far off the average, and will only become more likely to own over the next decade as they get pay increases and inheritances.
https://www.avanthomes.co.uk/about-avant/newsroom/40-home-ownership-statistics-for-the-uk-in-2024

Millennials are absolutely buying houses later on average but within the next decade will catch up to previous generations.

Over the course of human history it has never been the norm for most people, or even a majority of the population to own your own home - we're towards the end of a blip covering between approx 1990-2010 where over half the population owned - before that it was always a minority and has skewed between 47-53% since.

It's also skewed massively by where you live. I'm 36 and I can literally think of maybe 3 people I know between c.30-40 who DON'T own. That's my old school friends, uni friends, current friends and colleagues, both my siblings' friends and colleagues, etc.

Those people quoted in the first post are totally loaded if they can do that. Two people in professional roles can usually still buy if they save up for the deposit.