For many young people in the UK, the dream of buying a home can seem unattainable.
Indeed, with the cost of living rising and average house prices surpassing £300,000 for the first time in January 2026, as BBC News (6 February 2026) reports, many are struggling to get on the property ladder.
It’s unsurprising, then, that the average age of first-time buyers has risen from 32 to 34 since 2019, as Mortgage Strategy (4 December 2025) reports.
But high prices aren’t the only factor holding young people back from buying their first home. Research cited by FTAdviser (16 December 2025) found that, for Gen Z (born between 1997 and 2012), the biggest barrier to home ownership is a lack of awareness about the buying process.
So, by sharing your wisdom and experiences to teach the next generation about mortgages and budgeting, you could help give them a valuable leg-up onto the property ladder. Read on to explore three key lessons to share with them.
1. Creating a budget could help first-time buyers save for a deposit
According to Mortgage Introducer (30 April 2025), 62% of first-time buyers surveyed said saving for a deposit was a huge barrier to home ownership.
Creating a comprehensive budget that prioritises saving – and sticking to it – could help many people raise the funds they need to secure their first home.
As such, you might wish to share the following tips with someone struggling to save:
- Identify all your outgoings: From utility bills and subscriptions to coffee dates and car parking, identify where your money is going every month. It might be helpful to divide your costs into categories such as “entertainment” or “groceries”.
- Find opportunities to cut back: With your expenses laid out, identify where you can reduce spending, such as by cancelling unused subscriptions, shopping around for more competitive prices, or sacrificing some of your leisure activities. Even small savings can add up to make a big difference.
- Set monthly spending limits: To help keep costs low, set caps for spending in different categories. One popular method is the 50/30/20 rule, whereby you allocate 50% of your income to needs such as rent and bills, 30% to entertainment and leisure, and 20% to savings.
- Track your spending: To stick to a budget, you generally need to know how much you’re spending. Record your costs as you go using an app, spreadsheet, or notebook to help you stay on track.
Of course, a budget alone might not be a silver bullet in saving for a first home. The outcome will largely depend on the individual’s income, essential outgoings, and persistence in sticking to the budget. But by being more intentional with their spending and prioritising saving, they could accelerate their progress towards home ownership.
2. Calculating how much they can afford to borrow can help buyers set a goal
Saving without a specific goal in mind can feel aimless – and endless.
By calculating how much they could afford to borrow, and therefore how much they need to save for a deposit, first-time buyers can stay focused on their goal.
Several factors will impact a first-time buyer’s borrowing potential, including their:
- Regular income and employment status
- Credit score
- Monthly outgoings
- Deposit size and ratio to the property value.
You might help your loved one to understand how much they could borrow by explaining how each of these areas impacts the calculation and supporting them to find the information they need. They can then use an online mortgage affordability calculator to generate an estimated loan value or apply for a mortgage in principle.
3. Understanding how mortgages work can help young people prepare for their future
Mortgages can be confusing for first-time buyers. In fact, the research cited by FTAdviser found that 25% of Gen Z feel overwhelmed by the prospect of home ownership.
Discussing mortgages with your loved one can be extremely valuable in helping them take the next step towards buying their first home.
Here are some topics you may wish to cover with them:
- Interest rates: You might explain the difference between a variable and a fixed interest rate, as well as how interest is applied. It could also be worth explaining interest-only mortgages and what they can mean for repayments.
- Repayment terms: One confusing aspect of mortgages is the two different time frames – for example, you might have a three-year deal for a 30-year mortgage. It could be helpful to explain what these timelines mean to help them choose a suitable mortgage.
- Remortgaging: While remortgaging may not seem important when you’re only just trying to buy a home, it can be helpful to understand that your initial repayment rate is likely to change after a fixed term has ended.
As well as educating them about how mortgages work, you might wish to offer guidance on selecting suitable options, such as variable vs fixed rates. You could even draw on your own experiences of mortgages, interest rates, and home ownership to help them understand the possible outcomes of their decisions.
Advice alone may not be enough to help a first-time buyer get on the property ladder soon
While offering the above guidance could be hugely valuable to many young people, in some cases, it simply may not be enough to help them buy a home in the near future.
Property prices are at an all-time high and interest rates, while gradually falling, remain high at 3.75% as of February 2026.
As such, many rely on financial support to get on the property ladder. In fact, MoneyWeek (24 January 2026) reports that 40% of first-time buyers received financial support from loved ones in 2023/24.
You might be considering gifting a portion of your wealth to help fund the deposit. There are several options for you to consider, such as:
- Gifting them a lump sum, which could help reduce your estate’s Inheritance Tax (IHT) bill, depending on how much you give and when you give it.
- Supporting them with regular expenses, such as rent or bills, so they can prioritise saving for a deposit. This could also reduce your estate’s IHT bill if you meet the strict criteria for an exemption.
- Releasing equity from your home to gift to your loved ones, although it’s important to consider the impacts on your own wealth, lifestyle, and financial legacy. Equity release will reduce the value of your estate and potentially affect your eligibility for means-tested benefits. What’s more, the amount you owe when you pass away or move into long-term care can be significantly higher than the amount initially borrowed, due to interest accruing on the loan.
If you’re considering releasing equity from your home, or have a loved one searching for a mortgage, we can help evaluate the options and answer any questions.
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.
Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.
Equity release will reduce the value of your estate and can affect your eligibility for means-tested benefits.
A lifetime mortgage is a loan secured against your home. To understand the features and risks, ask for a personalised illustration.
The Financial Conduct Authority does not regulate tax planning or estate planning.