5 ways to help young adults get on the property ladder – without gifting the deposit

Whether it’s your child, grandchild, or any other loved one, as young adults fly the nest you may be hoping to help them buy their first home.

Over recent years, financial support has become increasingly common (and often necessary) for young adults to get onto the property ladder. In fact, a TSB survey of 1,000 first-time buyers found that 96% received financial help to pay their deposit, with 68% receiving support from family.

But it isn’t always possible to gift a large sum towards a deposit. For instance, your assets might be tied up in property or other investments, you may need to prioritise retirement saving, or you may not be able to offer equal support to all your children.

Whatever your circumstances, you may be able to support in other ways. So, you can help give loved ones a leg up onto the property ladder, without making impractical financial sacrifices.

Read on to discover five ways you could help a young adult get on the property ladder sooner.

1. Help them save up by alleviating their living costs

While you may not be in a position to gift a large portion of the deposit, you may be able to relieve some of your child or grandchild’s costs to help them set more aside for their deposit.

Depending on your financial circumstances, you might consider:

• Paying a portion of their rent
• Covering specific monthly costs, such as their phone contract or car insurance
• Helping with one-off expenses, such as car repairs or a new laptop.

If you can make these contributions out of your regular monthly income, while also affording your own living expenses, the gifts may be eligible for an Inheritance Tax (IHT) exemption. Alternatively, in 2025/26, you may be able to use your £3,000 annual exemption or £250 small gift allowance to ensure the gift is not included in your estate for IHT purposes.

As such, it’s often worth keeping a record of your gifts. That way, should you pass away, your executor may be able to exclude the gifts’ value from your estate.

Learn more – Understanding Inheritance Tax: Thresholds, rates, and who pays it

2. Regularly contribute to their savings pot

Rather than offering to cover some of their expenses, you might opt to make regular contributions to their savings.

You could either transfer funds into their current account for them to save however they choose, or send the money directly to their savings account.

If you choose the latter, be sure to check if the account has a deposit limit, a cap on monthly payments, or withdrawal restrictions before making the transfer.

You might encourage your loved one to pay into a Lifetime ISA (LISA), a type of tax-efficient savings or investment account designed to help people get on the property ladder or save for retirement. Savers can open one of these accounts between ages 18 and 40, and pay into one until age 50. Crucially, they can offer a valuable 25% government bonus of up to £1,000 a year (2025/26).

However, the funds must normally be used to purchase a first home or withdrawn after age 60, otherwise your child could incur a withdrawal charge that exceeds the amount of bonus received.

Bear in mind that you won’t be able to pay into their LISA yourself so it may be worth sending the gift to your loved one for them to pay into their LISA.

3. Cover housing fees besides the deposit

While the deposit is usually the largest expense associated with buying a first home, your child or grandchild will also incur a number of additional fees.

As such, you might wish to cover some of these costs so your loved one can focus on saving for the deposit. For example, you might support with:

• Solicitor fees
• Survey costs
• Mortgage broker fees
• Moving costs
• Furnishing expenses
• Stamp Duty, if the home is bought for over £300,000 in England – thresholds may differ in Scotland and Wales.

Paying some or all of these fees could help your loved one get on the property ladder sooner, as they may need to save for fewer expenses to afford their first home.

4. Provide free or low-cost accommodation

Alternatively, you could help a loved one save up without sacrificing your own finances.

According to TSB’s survey of 1,000 first-time buyers, 80% moved back in with their parents while they saved for their deposit.

Whether it’s your child, grandchild, or any other loved one looking to get on the property ladder, offering them a place to stay could have a significant impact on their savings. Even if they contribute to utility and grocery bills, the reduction in rent expenses could help them save up much quicker.

You might offer them a room in your own home. Alternatively, if you own multiple properties, you may be in a position to let them move in at reduced rental cost.

5. Offer financial guidance

Finally, you may be able to support first-time buyers with financial wisdom.

In 2024, research cited by UK parliament found that, of the 4,000 young adults surveyed, just 41% were considered financially literate.

As such, your loved one might benefit from some guidance to help them get on the property ladder. You might consider talking to them about:

• Creating a realistic budget – and sticking to it
• Using a LISA to boost their pot
• Growing savings with interest
• Building a strong credit score
• Choosing an affordable home.

If you’re unsure of how to offer such guidance, a financial planner could help steer you in the right direction.

Get in touch

If you’re wondering how you could support a loved one to buy their first home, we can help you create an affordable plan tailored to your circumstances. Email Marnel.Stafford@fosterdenovo.com or Ryan.Edwards@fosterdenovo.com, or call 07305 970959 or 0207 469 2800, to find out more about how we can help you.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate estate planning, cashflow planning or tax planning.