A recently published report from Legal & General Group ranks the Bank of Mom and Dad as the 7th largest home lender in the U.S. Aside from major mortgage lending companies and banks, family and friends actually play a larger role in helping buyers achieve their goal of homeownership.
According to the report, family and friends accounted for $317 billion worth of property purchases across the U.S. in 2018.
“For many, perhaps most, young adults, buying a house without help is an increasingly unattainable goal. More than half of prospective homeowners under the age of 35 now expect to have help from family or friends to buy a home; this is worrisome from several standpoints," said Legal & General Group Chief Executive Nigel Wilson.
"Over half of parents and others helping finance home purchases that we surveyed agreed that it is harder for younger generations to get onto the property ownership ladder than it was for them. While they cited the failure of income to keep up with the cost of living (64 percent) and high rents (49 percent) as reasons for this generational difficulty, the larger issue was property prices, which nearly three-quarters of BoMaD lenders say have risen to a point where they are unaffordable.”
To learn more about how family members and friends helped account for $317 billion worth of property purchases in 2018, click on the image above.