The real cost of your children living at home

Recently released research from movewithus’ online property portal, whitehotproperty.co.uk, has revealed that children living at home for 5 years could cost their parents as much as £12,500, or the price of a 12.5% house deposit*.

The research conducted by the movewithus website, which specialises in helping FTBs onto the property market, highlights that the average child is costing parents at least £170 a month**, not taking into account the fixed costs of running a large home. With an annual cost of £2,500, including extras, such as Christmas and Birthday presents, having a child live at home for another five years could amount to a total cost of £12,500.

With property prices and interest rates at their lowest point for ten years, experts are claiming that now is the optimum time for First Time Buyers to enter the market, with affordable houses and cheap borrowing available.

But, with lenders adopting stricter criteria for borrowing and asking for larger deposits, in some cases over 25%, First Time Buyers are unable to take advantage of the market.
In a bid to save up the money for a deposit, many potential First Time Buyers are now resorting to the Bank of Mum and Dad and staying at home. If they managed to save £500 a month, it would take 50 months to save for a deposit for a £100,000 property: four years and two months – thus costing their parents well over £12,000.

whitehotproperty.co.uk offers one in four properties on its website with a buyer incentive, such as cash towards a deposit, paid stamp duty or assisted purchase schemes, specifically to help struggling First Time Buyers in this position.

Robin King, founder of movewithus, commented: “The research has revealed some quite staggering results. Children are no longer able to flee the nest, as before, and are having to opt for cheaper living with their parents. However, there is a price to pay for having your offspring at home and, with the average age of people moving out of the familial home continually rising, the costs can be significant. With whitehotproperty.co.uk we aim to alleviate the situation through offering First Time Buyers incentives, such as cash towards a deposit.”

*The £12,500 cost of having a child stay at home for five years is equal to a 12.5% deposit on a £100,000 property budget. If the child/ren can also find a property with a gifted deposit of 5%, then the child only has to raise the final 2.5% to equal a 20% deposit. If they were saving £500 a month, then this will take five months compared to 50, meaning the opportunity is unlikely to be missed. Based on a 4.59% interest rate this is a monthly repayment of £450.72. Obviously other factors must be considered.

**Monthly cost per child
Gas = £59/4 = £14.75Electricity = £36/4 = £9Food = £400/4 = £100Phone = £22/4 = £5.50Broadband =£12/4 =£3Water = £28/4 = £7other/car = £10Clothes/holidays = £20.75Total = £170Annual Cost = £2040 + Five year = £10200