UK households still believe the main barrier to home ownership in the UK is saving enough money for a deposit, despite Help to Buy, according to the latest Genworth Index.

The insurer’s index report compares British consumers’ financial security and vulnerability with 19 countries across Europe and worldwide, whilst also assessing the impact of financial issues on the domestic mortgage and property markets.

81% of British adults feel that saving a deposit remains the key obstacle to owning a home – particularly in a market where house prices are rising and real wage levels have stagnated. This figure rises to 83% for the 25-34 year-old demographic group, showing deposit saving is a real concern for those most likely to be considering buying their first home.

Many households now expect parents to help first-time buyers fund a deposit. 79% of all adults feel aspiring owners need to borrow money from their parents in order to put down a deposit on a first home – a figure which rises to 83% for the key 25-34 demographic.

Even 83% of households in the higher income bracket – those earning over £25k pa -believe parents’ help is required possibly reflecting an increased ability to help or a heightened intention to do so. However, a separate study by Genworth among aspiring first-time buyers shows the reality that less than one in five (18%) can draw on parental help to raise a deposit.

British households also anticipate house prices are only going in one direction – up – with 72% braced for further increases in the next two years. Those in London (80%) and the South (78%) are much more likely to believe this compared to those in the Midlands (69%) and the North (62%).

Londoners see the greatest need for an increased supply of properties with 68% agreeing that more houses need to be built in the UK. This is higher than the national average of 56% and much more than those in the North – only 52% felt there needs to be a greater volume of housing available.

The Index – based on a survey of up to a thousand consumers in each of the 20 countries – also looks at the extent to which households are experiencing financial difficulties and how they feel their financial situation will change over the year ahead.

The report shows that Great Britain has twice as many financially vulnerable households as those classed as financially secure, however it continues to outperform its traditional economic neighbours and has maintained its European placing.

GB registered an ‘Index Score’ of 41 (2012: 39) on the scale of financial security placing it fifth on the European table ahead of both France and Germany but lagging behind the Nordic countries.

The majority of British households – 51% – have experienced financial difficulties at least ‘sometimes’ in the past 12 months. This type of pressure was more keenly felt by those under-55 (63%) than those over-55 (33%).

Simon Crone, vice-president of Mortgage Insurance Europe at Genworth Financial, said: “With the ongoing increase in house prices and incomes failing to keep pace, it is not surprising that the vast majority of British adults believe saving for a deposit remains the single biggest barrier to buying a property.

“Standard of living costs have also risen considerably in the past few years and saving continues to be difficult for many. With most British households anticipating that house prices are going to continue to rise while wage levels will not, the difficulties households face in saving for a deposit are not going to go away.

“Our Index reveals a growing expectation from both children and parents themselves that they will be required to help ‘fill the gap’ when it comes to their offspring’s savings and the level of deposit required. The Bank of Mum and Dad is now an institution which is increasingly called upon and has become a permanent fixture of the British housing market – but with many households financially vulnerable, not everyone has the luxury of this parental support.

“It’s clear therefore that we need to continue to build more homes and ensure we have a growing supply of low-deposit mortgages available in order to lessen the deposit burden for those who want to get on the property ladder.

“The Help to Buy mortgage guarantee scheme has acted as a much-needed catalyst to the high loan to value (LTV) mortgage market, but remains a short-term solution to a long-term problem. With this support due to end by 2017 it is absolutely vital the Government presents an exit plan which ensures high LTV mortgage availability continues to flourish and does not fall off a cliff.

“There is an ongoing and genuine interest in owner-occupation in Britain however we need a strong volume of new homes to meet this demand and the requisite finance options in order to help make the purchase. The next couple of years are a crucial period in the British housing and mortgage market if we want to ensure that the next generation of home-owners are not overlooked.”