06 November 2023

A step onto the property ladder: why families need your advice

According to our research, Bank of Family support for first-time buyers has reached record levels.

In 2023, parents, grandparents and other family members helped with 318,400 property purchases. And one in 10 people said they wouldn’t have been able to buy their home at all without this kind of helping hand.

It shows there’s a genuine need for the Bank of Family, and that financial gifts are not just a ‘nice to have’. They help ensure that much-needed deposit to attract better rates and broaden buying options.

A snapshot of the unsupported

Comprehensive financial advice is crucial. Yet, in our survey, only one in four Bank of Family lenders sought advice before helping a loved one take a step onto the property ladder.

Of those who did seek support, the most common source was a professional such as their mortgage broker or financial adviser. This was the case for 12.4% of our sample as a whole.

We also found almost a quarter used their property wealth to help their loved ones. That includes through equity release but also through down-sizing, re-mortgaging, or passing on an inheritance early.

Whole-of-family advice is crucial

As their mortgage broker or independent financial adviser, it’s crucial that you’re ready to support the whole family. Given the rising cost of living and today’s mortgage-rate pressures, both giver and receiver should understand what their decisions might mean before they take them.

  • Talk younger family members through the advantages of Bank of Family gifting, such as better interest rates and early inheritance.
  • Explain to older family members the range of products available to help them release the equity in their home, including over 50s lifetime mortgages and retirement interest-only mortgages. Some of which they might not be aware of and which could be relevant when rates are changing frequently.
  • Guide everyone through some of the things they should know, such as the fact that financial gifts may be subject to inheritance tax down the line.

Building family relationships

Being able to provide comprehensive professional advice like this for the whole family will connect you to clients in genuine need – such as the 72% in our survey who didn’t get support before making significant financial decisions. And it will make you a trusted resource for future financial advice, too. So it’s important you’re equipped with the information and perspectives you need. 

Get started by reading and sharing our guide to gifting PDF: 3MB with your clients. Then speak to our team of experts for more about the products we offer to support the Bank of Family.

How a lifetime mortgage can help

A lifetime mortgage is a loan secured against your client’s home and is a way for your clients to release some of the equity in their home. They can use the money released to help family members put together a deposit for their first home. Or they might choose to help them cover other expenses like solicitor costs, moving expenses or furnishing a new property.

Lifetime mortgage lending or equity release is an important market because of the way it gives people access to the value in their homes without them having to sell up. For many homeowners, particularly those aged over 50, their property is their most significant asset. So it’s no surprise that many might consider using it to help loved ones onto the property ladder.

Bank of Family

With Bank of Family lending expected to hit £10 billion by 2025, there’s a huge opportunity for you to guide more families through the process. Read our article.

Family of women