Despite being labelled the Bank of mum and dad generation, six in ten first-time buyers have a second source of income to help them save for a deposit – a figure that rises to more than eight in ten in London.
And starting a business emerged as the most popular “side hustle” with half of those doing so starting a venture completely unrelated to their current job.
Others are working bar jobs at weekends or using their professional skills more widely, such as a web developer designing websites for friends and family in the evenings.
And it doesn’t look liker ending when they have moved in. Many are planning to keep up the habit to help pay for renovations or furnishings, according to a new survey from Ipswich Building Society.
The importance of the extra income is highlighted by the fact that it account for two fifths of a deposit on average. With a typical first time buyer deposit at almost £59,000, that means around £23,020 is being generated from these so-called “side hustles”.
This research highlights the fact that this generation are committed to helping themselves rather than solely relying on older family members
Kevin Davis, Head of Direct Mortgages said: “There’s been much discussion in recent years of the rise in gifted deposits, where parents and grandparents are keen to help their children get a foot on the property ladder, however that’s simply not an option for everyone.
“This research highlights the fact that this generation are committed to helping themselves rather than solely relying on older family members for handouts.
“Running a business is not for the faint-hearted and doing so alongside another job shows a commendable effort. We know that rising house prices are problematic for buyers who are trying to get on to the property ladder for the very first time but a silver lining will be if their efforts to save a deposit result in a new wave of entrepreneurs.”
But he gave a warning about proof of income for mortgage affordability assessments: “During a mortgage application, if buyers wish for additional income from their side business to be used in the affordability assessment, and not just as a means to build up a deposit, they will need to demonstrate that this income is ongoing and should be prepared to provide tax returns as evidence,” he said.
Do Millennials really want it all?
More on he survey here