A million more grown-up children set to move in with their parents in the next decade as house prices push ownership dreams out of reach
- 3.8 million grown-up children expected to be living with their parents within the next decade
- It is an increase of 1 million on current levels, claims Aviva report
- Rising house prices - which have jumped 52% in the past decade - are being blamed
A million extra grown-up children are expected to be living with their parents by 2025 due to soaring house prices, a new report by insurer Aviva suggests.
The Bank of Mum and Dad has long been a familiar route for many grown-up children looking to get onto the property ladder.
But house prices have risen so much in recent years that even financial support from parents may not be enough to get them straight onto the property ladder, according to the report.
It claims that the new 'House of Mum and Dad' is stepping in to fill the void, enabling buyers to save longer for a deposit - with an extra million grown-up children expected to be living at their parent's house by 2025.
Rising house prices are expected to lead to a total of 3.6 million grown-up children with their parents in 2025
The report found that 23 per cent of adults aged between 21 and 34 were living with their parents in 2015, the equivalent of 2.8 million people.
It is an increase of 32 per cent - or 684,000 people - since 2005.
The figure is predicted to rise by one million to 3.8 million by 2025, according to the Aviva Changing Households report.
It blamed the lack of affordable housing, pointing out how house prices have risen by 52 per cent during the past 10 years from an average of £184,000 to £279,000.
A total of 57 per cent of grown-up children also said they would consider living with their parents as a way of helping to save for a deposit.
This was only beaten by the 71 per cent who said they would move in with their parents to care for an unwell relative.
|Average UK house price||Homeownership||Average UK annual salary (mean)|
|Difference (%)||52%||- 6 percentage points||+ 14%|
Many of those living back with their parents see it as an advantageous move.
They cited having company, cheaper shared living costs and more people to share chores as some of the main benefits.
Only 12 per cent said that the disadvantages of living in a multigenerational household outweighed the benefits.
|Adult children still living with parents (have not yet moved out)||70%|
|Adult children moved back home for other reasons||13%|
|Adult children moved home after university/higher education||10%|
|Adult children moved back home to save up for a house deposit||9%|
|Parent or elderly relative moved in||9%|
Despite the challenges, buying a home remains a life goal for many people, according to the report.
However, they accept that it is now a longer-term goal and accept that they need to save for longer.
Among the over 55s, 53 per cent said they want to become a homeowner as quickly as possible. This drops to 43 per cent of 25 to 34 year olds, the report found.
With house prices continuing to rise, more people are expected to live with their families.
Lindsey Rix, managing director of personal lines at Aviva, said: 'We're familiar with the term 'The Bank of Mum and Dad' but our research suggests that the Home of Mum and Dad is becoming the norm for lots of young people, particularly as a temporary measure, such as while they try to save a deposit for their own home.'
However, she added: 'Rather than being an inconvenience, our report shows it is often a positive experience, with shared living costs reducing financial strain and the added benefit of constant company.
'If house prices continue to rise at their current rate, we can expect the number of multigenerational houses to continue to grow.'
Buying agent Henry Pryor said: 'At this rate the UK property market is going to look like The Waltons as the House of Mum and Dad becomes the house of Grandma, the kids and no doubt the grandchildren too.
'Parents will look forward to retirement if only because by then they may get their house to themselves.'
It comes as an economic forecaster said that house prices have surged to more than six times average earnings.
Fathom Consulting said the UK's house price to income ratio is now at 6.1 times earnings, 'within a whisker' of its pre-recessionary peak of 6.4 times and well above the long-term average.
It said house prices would need to plummet by up to 40 per cent to fall in line with average earnings, or household incomes would have to grow at 10 times their current pace for the next five years to fall into line with the pre-2000 average of 3.5 times earnings.
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