Parents' Bank (informal term) has distributed £38.5 billion in home purchasing assistance to their children... within a span of four years.
The Old Man and His Wallet dolled out an astounding £38.5 billion over the past four years to help their children take that first step onto the property ladder, fresh numbers show.
This whopping sum represented a 71% increase from the £22.5 billion given in the four years prior, between 2017 and 2020. In 2024, parents handed out a record-breaking £9.6 billion – a jump from the £9.37 billion doled out in 2023 and significantly more than the £8.87 billion gifted in 2022. However, the most money – £10.67 billion – was given in 2021, during the pandemic-induced house price surge.
Did the Old Man and His Wallet pull out all the stops to assist 173,500 first-time buyers in getting a foot on the property ladder last year? Absolutely. On average, these budding homeowners received £55,572 in assistance, making up 54% of all first-time buyers.
What's even more startling is that, although this percentage is lower than 2023, it's still higher than in every other year since 2012. First-time buyers nationwide were feeling the squeeze from a tricky mortgage market and higher rates, causing them to lean on their families for support. Those who received help took advantage of lower family loan rates to secure their deals.
In the month prior, nearly 30,788 first-time buyers were given hefty gifted deposits of £100,000 or more. Roughly a quarter of them were granted deposits of that size.
Lucian Cook, the lanky head of residential research at Savills, shared his insights, stating, "First-time buyers are still grappling with the high mortgage rates and stringent lending criteria, which have prompted a greater proportion of them to seek family support to secure a mortgage deal on more affordable terms."
Stamp duty thresholds caused a buying frenzy in the first half of 2025, with a flood of first-time buyers scrambling to finalize their deals before the changes took effect at the end of March. Although the number of buyers is expected to decline in the months to come, the pressure to buy is fierce, as many young buyers are shelling out thousands in rent and see little incentive in waiting for mortgage rates to plummet.
Mortgage rates have been inching downward, and some predict the Bank of England may slash interest rates three to four times this year rather than the originally planned two. Consequently, many lenders have slashed their rates, with the lowest currently sitting comfortably below 4%.
As mortgage rates drop, Cook anticipates the Old Man and His Wallet's assistance may decrease, largely due to easing lending conditions and lower mortgage rates. Last month, HSBC tweaked its affordability calculations, potentially allowing customers to borrow £39,000 more. Additionally, Lloyds Banking Group relaxed its mortgage rules, which could lead to increases in the maximum loan amount of around 13% and an extra £38,000 on the mortgage for a typical family with a total household income of £75,000.
"Relaxation of mortgage stress tests is expected to boost borrowing by easing entry into the market and allowing first-time buyers to qualify for larger mortgages," said Cook. "However, as more first-time buyers appear on the scene, the cost per buyer may drop."
Despite the need for financial support from the Old Man and His Wallet varying by region, there's a disheartening trend in London and the South East. The average first-time buyer income tends to be the highest nationwide, ostensibly suggesting higher levels of homeownership. Regrettably, this isn't the case, as salaries often trail behind the soaring deposit requirements.
"The average deposit needed as a percentage of income is 138% in London," Cook lamented. "This is beyond what most average buyers can save independently, making it extraordinarily difficult for new buyers to break into the market without a helping hand."
- The significant increase in financial assistance given to first-time buyers over the past four years, totaling £38.5 billion, was primarily used for mortgages to purchase property.
- Many first-time buyers have been leaning on their families for financial support in the banking sector, with lower family loan rates helping secure mortgage deals.
- As mortgage rates drop and lending criteria become less stringent, the need for personal-finance assistance from families like the Old Man and His Wallet may potentially decrease, making it easier for more first-time buyers to enter the housing market.
