First time buyer age soaring

A recent study has shown how the average age of the first time buyer has soared over recent decades, with the younger people of today expecting to be around twelve years older than their parents were when they manage to purchase a property for the first time. The study was carried out by the Post Office and showed that the difficult economic and financial climate had really taken its toll on potential first time buyers.

Over the past few years, first time buyers have been hit hard by the problems in the mortgage and property markets. Many have been unable to afford to raise the huge deposits that lenders have been demanding and many others have been unable to get a mortgage at all due to increased restrictions and stringency from lenders, who have been exercising increased caution.

The study involved polling parents and younger people and showed that the average age of parents when they bought their first property was around twenty three whereas their kids expected to be around thirty five years of age on average by the time they managed to afford a property themselves. This would see the average age of the first time buyer soar by twelve years, with parents in the 1960s purchasing in their mid twenties and younger people today having to wait until their mid thirties. The average twenty-something of today earns around £21,000 in terms of salary, but with average property prices at £164,000 most would be unable to consider buying a property on their own.

One industry official stated: “Many would-be first-time buyers may have been put off trying to get onto the housing ladder by the size of deposits now needed. Some may be deterred by their perception of high mortgage repayments.”

Tags: GBP, first time buyer, post, 1960s, would-be first-time buyers, recent study, average property prices, Parent

Offspring claim financial independence whilst taking cash from parents

A recent study has found that there are many young adults in the UK who class themselves as being financially independent, yet they are still taking money from their parents to help fund a wide variety of things. Read more

Tags: future, way, class, financial independence, help, cash, Parent, financial future

Parents make sacrifices for children

Parents are making considerable financial cut-backs in order to afford what their children want, according to new research.

Findings from Engage Mutual reveal that up to 49 per cent of parents with children under 18 say that they have given in to their children’s pleading in the last 12 months.

A further 68 per cent said they would make financial sacrifices to be able to afford gifts that their children ask for.

Karl Elliott, spokesperson for Engage Mutual said: “With kids being spoilt for choice for toys, technology and games, many feel pressure from their peers to keep up with the latest gadgets and labels.”

He added that the research gives a new perspective into family finance with some children ‘wearing the trousers’ when it comes to family spending.

The survey found that up to 44 per cent of parents with children under 18 say that they cannot always afford what their children want or need, with 81 per cent of these parents being more likely to make sacrifices.

Meanwhile, the child poverty action group has welcomed the proposals in the budget stipulating that £1 billion will be put aside to help child poverty.

Tags: pressure, family, research, order, Parent, survey found that, Childhood

Blocked spending on credit cards problematic

Young travellers who take a parent’s credit card with them on their travels are finding it blocked for appearing fraudulent, gapyear.com has said.

Backpackers are often found to be spending abroad while their parents are simultaneously carrying out transactions on a copy of the same card at home which can lead to the provider stopping the card.

Tom Griffiths, founder of the travel website, said: “Because they visit a few countries in a limited amount of time, it looks like fraudulent behaviour.

“And, if they’re away from home, the credit card company tries to contact them but obviously they’re inaccessible, so their cards are being blocked. That’s a big problem at the moment [for] backpackers.”

He added that many parents give their children a credit card for cases of emergency as their “biggest fear” is them finding themselves without “access to cash” while away from home.

Furthermore, he said, there is now a specialised card coming in for backpackers and gap year travellers that is prepaid and allows transactions with no risk of blocking. It also removes the common problem building up “uncontrollable debt”.

According to gapyear.com 230,000 people take a gap year between the ages of 18 and 24, spending an average of £3-4,000.

Tags: copy, Credit Cards, credit, Parent, fear, amount, card.tom griffiths, Credit card

Parents forking out for offspring debt

Some 7.5 million parents are having to financially support their adult children, new research has found.

A MoneyExpert survey found that 40 per cent of parents with adult children have to help out with debt problems, with some £2,540 being paid per family on average.

Mobile phone bills and car finance were the most popular debt types that 24 per cent of parents have helped to cover the cost of, closely followed on 23 per cent by credit card bills.

Overdraft finances on 20 per cent and student loan debts on 15 per cent also featured as the fourth and fifth most common types of debt.

MoneyExpert chief executive Sean Gardner commented that the figures reveal that child expenditure is now a financial burden for many parents even when their kids reach adulthood.

“With the cost of living so high at the moment and with so many people living a buy-now-pay-later lifestyle, parents are often forced to help out with their children financially in later life,” he added.

Recent statistics from the debt charity Credit Action reveal that the average graduate debt for adults under the age of 30 is £12,363, but the figure represents both a decrease of £889 on 2006 and the first drop in graduate debt for six years.

Tags: graduate debt, Credit card, credit, adult children, Student loan, Parent, Financial services, adult

Bank of mum and dad calls in its debts

University graduates are still reliant on their parents to help them get onto the property ladder but the bank of mum and dad is getting stricter.

According to new research, 39 per cent of graduates rely on money from their parents to get a deposit on a new home.

However, more and more parents now expect their children to pay them back rather than simply offering the money as a gift.

Scottish Widows Bank says that in 1996 38 per cent of parents gave their graduate children the money for a deposit as a gift but this has fallen to just 32 per cent today.

The reduction in charity from parents may be a symptom of poorer finances for most people and this is supported by the fact that the number graduates needing a loan has also increased.

In 1996, nine per cent needed to turn to their parents for money, while today that figure stands at 18 per cent.

Another contributing factor is high rental costs which Scottish Widows says are forcing many graduates to turn to their parents for financial help.

“Rental rates are so high for some that it is very difficult to put enough money aside to save for a deposit meaning many graduates have to rely on their parents to fund that first step onto the property ladder,” said Richard Clark from the bank.

“House prices and affordability are huge barriers for first time buyers but they should be aware that there are other options available to them – both lenders and the government need to keep working on ways to solve this ever growing problem.”

Tags: house prices, charity, Parent, University graduates, poorer finances, loan, money, Business Finance