‘Boomerang generation’ gets parents into debt

By Martin Williamson, head of residential property at Latimer Hinks Solicitors

By Martin Williamson, head of residential property at Latimer Hinks Solicitors

First published in News

EMPTY nest syndrome used to be something that many mothers, in particular, dreaded. In years gone by, children would go to university and, most likely, stay away when they found a career and started their own families.

In the years between graduation and ‘settling down’, most young people would have been able to get on the property ladder, either in their own right or with a partner.

Nowadays, however, we are seeing increasing numbers of young people joining the so-called ‘boomerang generation’. They graduate or move away to work for a few years, then return home.

New research has found that a quarter of 22 to 30 year olds depend on their parents for somewhere to live. A study by the Institute of Fiscal Studies has also shown a decline in the number of young people owning their own home compared to their parents when they were the same age.

The research, which was commissioned by the Joseph Rowntree Foundation, found that from 2011 to 2013, 28 per cent of those aged 22 to 30 were still living in the family home – a total of 2.1 million.

Other new research by Shelter reveals that nearly two million working young adults aged between 20 and 34 years old in England are still living with their parents. The charity said data it has taken from the Census shows that there are 1.97 million people in this age group in England who are still living with their parents, accounting for one quarter of all young adults in employment. It is urging stronger action to help the “clipped wing generation” fly the nest.

Times are certainly changing.

Among those born in the 1960s, 45 per cent owned a house by the time they were 25. That compares with 34 per cent born in the mid-1970s and just 21 per cent of those born in the mid-1980s.

Several factors have changed in the intervening years: the main one being that there has been a 40 per cent rise in average house asking prices. This means that many young people are saving for far longer than they used to.

The continuous rise in rental prices is also deterring young people from standing on their own two feet, while the age at which many choose to marry has also hit 30 for the first time.

What does this all mean for their parents?

Well, never has a phrase been truer than ‘children are for life’.

The family home now echoes with the sound of grown-up children draining their parent’s nest eggs, retirement funds and pensions.

The debt charity StepChange has even reported a 44 per cent increase in the number of over 60s falling behind with mortgage payments in the last three years.

For further information log on to latimerhinks.co.uk or call 01325 341500.

Please note: This article is intended as guidance only and does not constitute advice, financial or otherwise. No responsibility for loss occasioned/costs arising as a result of any act/failure to act on the basis of this article can be accepted by Latimer Hinks.

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