Buy-to-let property investment helped by the ‘bank of mum and dad’

Contact Us


According to a July 2016 article in the Daily Telegraph, many parents and grandparents are giving their children money to enter the buy-to-let property market.

The Daily Telegraph estimated that parents and grandparents in the UK have contributed around £5bn to help their children buy their first home. This makes the ‘bank of mum and dad’ the UK’s 10th biggest mortgage lender.

Now, the Daily Telegraph has discovered a new trend for parents to give financial help for their children investing in buy-to-let property. Instead of buying property to live in, many young people are purchasing buy-to-let properties as their first step on the ladder, and to receive rental income.

Most of these investments have been outside London. In the same article, My Home Move, a conveyancing organisation, highlights the Midlands as a good area in which to invest in property as buy-to-let yields are somewhere between 5-6% there, compared to a London yield that is dropping below 4%.

Many investors, after owning a buy-to-let property for a while, then release money from it to use as a deposit for other property, even though a second property will mean paying an extra 3% in stamp duty.

One successful investor quoted by the Daily Telegraph. Nicole Dean, used £25,000 gifted by her father to invest in property. She recommends the arrangement to those able to do it, saying:

“It was nice and easy. It’s something we’d definitely do again as it’s all gone really well.”

Buy-to-let property investment helped by the ‘bank of mum and dad’

Find exactly the right mortgage for you with a free mortgage consultation

[bsf-info-box icon="Defaults-check" icon_size="32" icon_color="#ffffff" title="Free initial consultation"][/bsf-info-box][bsf-info-box icon="Defaults-check" icon_size="32" icon_color="#ffffff" title="No obligation" el_class="white"][/bsf-info-box]

[fc id='3'][/fc]

According to a July 2016 article in the Daily Telegraph, many parents and grandparents are giving their children money to enter the buy-to-let property market.

The Daily Telegraph estimated that parents and grandparents in the UK have contributed around £5bn to help their children buy their first home. This makes the ‘bank of mum and dad’ the UK’s 10th biggest mortgage lender.

Now, the Daily Telegraph has discovered a new trend for parents to give financial help for their children investing in buy-to-let property. Instead of buying property to live in, many young people are purchasing buy-to-let properties as their first step on the ladder, and to receive rental income.

Most of these investments have been outside London. In the same article, My Home Move, a conveyancing organisation, highlights the Midlands as a good area in which to invest in property as buy-to-let yields are somewhere between 5-6% there, compared to a London yield that is dropping below 4%.

Many investors, after owning a buy-to-let property for a while, then release money from it to use as a deposit for other property, even though a second property will mean paying an extra 3% in stamp duty.

One successful investor quoted by the Daily Telegraph. Nicole Dean, used £25,000 gifted by her father to invest in property. She recommends the arrangement to those able to do it, saying:

“It was nice and easy. It's something we'd definitely do again as it's all gone really well.”

[templatera id="5896"][interactive_banner_2 banner_title="Mortgages" banner_image="id^6029|url^https://ascotmortgages.co.uk/wp-content/uploads/2019/09/m1.jpg|caption^null|alt^null|title^m1|description^null" banner_link="url:https%3A%2F%2Fascotmortgages.co.uk%2Fmortgages%2F|title:Mortgages||" banner_style="style2" el_class="lifebanners" image_opacity="1" image_opacity_on_hover="1"][interactive_banner_2 banner_title="Bridging Finance" banner_image="id^6027|url^https://ascotmortgages.co.uk/wp-content/uploads/2019/09/b3.jpg|caption^null|alt^null|title^null|description^null" banner_link="url:https%3A%2F%2Fascotmortgages.co.uk%2Fbridging-finance%2F|title:Bridging%20Finance||" banner_style="style2" el_class="lifebanners" image_opacity="1" image_opacity_on_hover="1"][interactive_banner_2 banner_title="Equity Release" banner_image="id^6030|url^https://ascotmortgages.co.uk/wp-content/uploads/2019/09/m2.jpg|caption^null|alt^null|title^m2|description^null" banner_link="url:https%3A%2F%2Fascotmortgages.co.uk%2Fequity-release%2F|title:Equity%20Release%20||" banner_style="style2" el_class="lifebanners" image_opacity="1" image_opacity_on_hover="1"][interactive_banner_2 banner_title="Life Insurance" banner_image="id^6028|url^https://ascotmortgages.co.uk/wp-content/uploads/2019/09/b4.jpg|caption^null|alt^null|title^ |description^null" banner_link="url:https%3A%2F%2Fascotmortgages.co.uk%2Finsurance%2Fmortgage-life-insurance-cover%2F|title:Life%20Insurance||" banner_style="style2" el_class="lifebanners" image_opacity="1" image_opacity_on_hover="1"][interactive_banner_2 banner_title="Test" banner_image="id^6671|url^https://ascotmortgages.co.uk/wp-content/uploads/2019/09/er.jpg|caption^null|alt^null|title^null|description^null" banner_link="url:%23|title:Test||" banner_style="style2" el_class="lifebanners hide" image_opacity="1" image_opacity_on_hover="1"]

Contact Us