Nationwide, some 25% of home buyers had support of the ‘bank of Mum and Dad’, with 13% drawing upon family inheritance and 12% on parental loan. Some 41% of 25- to 34-year-olds are now using inheritance or a loan from parents to fund a home purchase. 14% of 18-24 are using cryptocurrencies compared with just 1% of homeowners overall.
London accounts for the highest proportion of homebuyers using family inheritance to fund property purchases, according to new research from client compliance platform Thirdfort.
Some 18% of Londoners cited family inheritance as a source of finance for home buying, compared with 16% in the East of England, and 14% in the South. Meanwhile, just 10% in the Midlands cited the same and those in Scotland and Wales were least likely to use inheritance with just 9% and 8% saying the same.
The survey of 2,054 UK adults by YouGov also shows those in the East of the country were more likely to receive family support overall. A third of homeowners in the East received either a loan from their parents or inheritance to help buy a property. Homeowners in London were next with 31%. However, just 19% of homebuyers in the Midlands received family support while only 15% in Scotland said the same.
The research also that those aged 25 to 34 were most likely to receive family support, with 41% using inheritance or a loan from parents to fund a home purchase. Those aged 35 to 44 were next with 37% using inheritance or a parental loan.
| Region | Family inheritance | Parental loan | Combined family help |
| North | 11% | 11% | 22% |
| Midlands | 10% | 9% | 19% |
| East | 16% | 17% | 33% |
| London | 18% | 13% | 31% |
| South | 14% | 13% | 27% |
| England (NET) | 13% | 12% | 25% |
| Wales | 8% | 12% | 20% |
| Scotland | 9% | 6% | 15% |
| Northern Ireland | 14% | 14% | 28% |
The findings also show that 14% of 18–24-year-olds are using cryptocurrencies as a source of finance for property transactions, significantly greater than the 1% of homeowners overall. No homebuyers over the age of 45 reported using cryptocurrencies to fund home buying.
The survey results highlight the breadth of funding sources home buyers now draw upon:
- Savings (59%) and employment income (46%) are the largest sources of funding
- Some 25% of use some form of ‘bank of Mum and Dad’ support, with 13% drawing upon family inheritance and 12% on a loan from parents
- Investments account for 8% while business ownership accounted for 2%
Olly Thornton-Berry, co-founder and managing director of Thirdfort, said:
“Our research shows that homebuyers now draw upon a wide range of sources to fund transactions. Verifying those sources of funding and wealth is a complex but essential focus for property professionals who have a regulatory responsibility to ensure that funding is legitimate.
Though some areas such as savings and employment can be easily verified, others such as gifts and investments pose a significant risk to property professionals and the wider economy. That’s why it’s important for home buyers and property professionals to use the latest tools and technology to ensure transactions are safe and secure.”
Thirdfort automates Know Your Client, Anti-Money Laundering and Source of Funds verification using AI, biometric verification, and Open Banking. It has transformed a cumbersome process that has historically taken weeks into one that takes just minutes.
The firm has recently developed a new source of funds feature to helps property professionals analyse clients’ bank accounts, highlight red flags, and provide them with the evidence they need to feel confident they have corroborated a client’s story. This enables lawyers and agents to spend less time trawling through bank statements and more time on fee-earning work.
Overall, Thirdfort has verified more than 1m people on behalf of more than 1,000 conveyancers, lawyers, estate agents and other regulated professional services firms. This number accounts for around 2.5% of all adult smartphone users in the UK.
This article was submitted to be published by Thirdfort as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.
