The new report from FTSE100 financial services group Legal & General and Cebr shows that, amidst a reduction in transaction volumes across the UK housing market, BoMaD will fund nearly 20% fewer property purchases than in 2018.
The jump in BoMaD loan sizes has increased total lending for the Bank of Mum and Dad by 10% this year - up to £6.3bn from £5.7bn in 2018. As a result, BoMaD is now the 11th largest mortgage lender in the UK.
Key findings from Legal & General’s 'Bank of Mum and Dad' research include:
- BoMaD will continue to support thousands of buyers across the country in 2019 - involved in more than a quarter of a million (259,400) property purchases down from 316,600 transactions last year, but it still amounts to nearly one in five (19%) transactions in the UK mortgage market
- BoMaD will help buyers to purchase property worth nearly £70bn this year
- In the North West, the average BoMaD ‘loan’ has nearly doubled from £12,900 to more than £24,000
- The South West saw the average contribution rise by over £10,000 to £29,700
- BoMaD lenders in London are contributing the most to help family or friends onto the ladder (£31,000 per transaction on average), but those in Wales are also supporting loved ones to the tune of £30,600
- Borrowers in the West Midlands are set to receive the least support (£13,700)
- Nearly a fifth (19%) of BoMaD lenders were providing financial support because they felt it was their personal responsibility to help younger family members buy a home
- Over three-quarters (77%) of those receiving support in 2019 are home movers, not first-time buyers, compared to less than two-thirds (62%) of home movers in 2018.