Home invasion: fifth of adults live with parents until they're at least 26

It has been dubbed the hotel of mum and dad but few guesthouses have such favourable terms. As the housing crisis bites, a fifth of young adults are staying in the family home until they are at least 26, and the same proportion are not paying a penny towards their keep.

A survey by Nationwide, the building society, found that the proportion of adults living at home varied around the country, from just under 9% in the east Midlands, to more than double that in London, where house prices and rents are highest. While many around the country contributed financially, it found that 20% were paying nothing at all.

Young adults are being squeezed by low wages and rents which have hit record highs, while those who want to buy a property are finding the monthly cost of renting is preventing them saving enough to get on the housing ladder. Research published by the homeless charity Shelter on Friday showed half of tenants were unable to save a penny towards a deposit, while a quarter could only put by £100 or less each month. Mortgages are cheaper than ever before thanks to record low interest rates, but the best deals are still reserved for borrowers with large deposits.

Faced with this, young adults are increasingly returning to the family home in order to save money, and parents who cannot afford to offer their offspring a lump sum seem willing to help. Nationwide’s survey found that 28% of adults were living at home because they were trying to save a deposit. However, it also found that 30% were not saving any money.

A Nationwide spokesman said: “The hotel of mum and dad is often staying open for longer than many anticipated, our latest research shows. Rental costs and deposits or the need to save for a mortgage deposit mean that some children understandably have to wait before flying the nest. And, for some, moving out may never be an option.”

Michael Day, 30, who lives with his parents and his older brother in the family home in Bristol, says he has been caught between paying high rents and saving for a mortgage deposit. Rents for a one-bedroom home in the city are between £500 and £800 a month, while buying a similar property would cost about £130,000. “I don’t really want to move out to rent as it’s more than a mortgage but you need such a big deposit to get a mortgage so it’s been a bit of a vicious circle.”

Day does not want to share with strangers, so his options are limited. At home, he pays a nominal rent to cover bills and is able to keep the rest of his earnings from his job at a candle retailer. He plays golf at county level and he admits that instead of saving he spends his spare cash on golf and holidays. “You need so much money that I will have to save for the foreseeable future,” he said. “Because it’s been so difficult I’ve been going on holiday and enjoying it.”

Sue Green, of Saga, a business that sells insurance and products to the over-50s, said the majority of parents may not have planned to have their children living with them well into their 20s or 30s. “Most will be more than happy to house them in the family home rent-free because it might help their kids get on the property ladder sooner,” she said. “Children who don’t pay rent may contribute in other ways like buying groceries, family takeaways or doing odd jobs around the home.”

Green added that parents were often willing to make sacrifices “if it means the whole family are together watching Strictly on a Saturday night”.

Angus Hanton, co-founder of thinktank the Intergenerational Foundation, said older generations were “the architects of the housing crisis” and children should not be blamed for staying at home. “The under-30s have suffered a fall in average incomes of about 20% since the 2008 downturn. Rents and car insurance have never been so high and mortgage lending rules have been tightened for the young but not for older buy-to-let investors, who squeeze out the young,” he said.

“Student-fee debt is rising rapidly yet many jobs on offer – zero-hours and short-term contracts – are turning younger workers into second-class citizens. Rather than blaming the young we should be standing up for their interests so they can afford to build lives of their own.”

Jenna Gavin, 29, lives in Southport, Merseyside, in the family home where she grew up. She moved out for a year to go to university, but has been living with her parents ever since. She works as a medical receptionist nearby so she wants to stay in the area. But renting a one-bedroom flat would cost more than £420 a month before bills, which would take up a lot of her earnings.

“I don’t want to rent – I don’t want to spend all that money and have nothing at the end,” she said. “I’ve looked at buying and seen mortgage advisers but I just can’t borrow enough to get on the property ladder.”

Gavin is trying to save but is struggling to amass the necessary funds. “You don’t really see it building up as much as you need – even a 5% deposit is such a lot of money and I would like to put down more,” she said.

Her parents are happy not to charge her rent. “They want me to try to save up and I contribute in other ways – I bring food in and I do things around the house.”

Gavin gets on with her parents and has her own space in a room that she moved into when she was 14, but she said she had always imagined she would have her own place by the time she was 30. “I don’t see that happening, as it’s next year, so hopefully in a couple of years I’ll have moved out.”