New buyers forced to turn to family

24 2008
Potential first-time property buyers are finding it so difficult to finance their purchases that they are turning to their families for financial help.

According to the Council of Mortgage Lenders (CML), an increasing number of people have to seek help from their parents or other relatives.

It is a result of the global credit crunch which has forced many mortgage lenders to withdraw some of their most attractive deals.

In particular, the removal of 100 per cent and 125 per cent deals has hit new buyers hard.

As a result, many people are turning to their parents for help with raising a deposit but not everyone can afford to lend their children money to buy a home so a large number of people are choosing to rent instead.

"We have seen [parents] who have enjoyed equity growth in their own property over a period, being able to draw on that to help relatives who are first-time buyers with a deposit," said Bernard Clarke from the CML.

"That's great for those who are in the fortunate position of having relatives who are able to and willing to do that - but not everybody's in that position," he added.ADNFCR-1219-ID-18567057-ADNFCR

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