The Bank of Mum and Dad pays rent costs too

The Daily Telegraph - Your Money - - YOUR MONEY - Sam Mead­ows

Par­ents will pay £2.3bn this year help­ing their chil­dren with rent, as the “Bank of Mum and Dad” stretches be­yond help­ing with house de­posits. The fig­ures, re­vealed by Le­gal & Gen­eral In­vest­ment Man­age­ment this week, show that par­ents are also foot­ing the bill for rental fees. It found 10pc of par­ents had paid for a se­cu­rity de­posit, 6pc for mov­ing costs and 5pc for let­ting agents’ fees.

Dan Bat­ter­ton, a fund man­ager at the com­pany, said: “The lack of af­ford­able hous­ing, low wage growth rel­a­tive to in­fla­tion and bur­dens of stu­dent debt mean that many kids can’t even rent some­where with­out sig­nif­i­cant con­tri­bu­tions from their fam­ily.”

The out­lay on rent, along with £6.5bn in mort­gage pay­ments, means the Bank of Mum and Dad will spend £8.8bn this year.

Kasper van der Ploeg, 19, is a ben­e­fi­ciary of the Bank of Mum and Dad. He is be­ing sup­ported by his par­ents while he com­pletes an in­tern­ship at a cen­tral Lon­don ho­tel, as part of a uni­ver­sity de­gree in his na­tive Hol­land. His par­ents pay half the £900-a-month rent on his flat­share in Pim­lico.

“Rent is so ex­pen­sive here, par­tic­u­larly in Lon­don, if I didn’t have the sup­port from my par­ents I would be spend­ing ev­ery penny I have on rent,” he said.

Ale­jan­dro Ar­ta­cho, the founder of on­line let­ting agent Spota­, said ris­ing house prices and rents were push­ing more young peo­ple to flat­shares than they have in the past.

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