'Bank of mum and dad' rules first-time buyer market

Finder's First Home Buyer Report 2025 showed that nearly one in five (17 per cent) of first home buyers were relying on financial aid from their family to save up their deposit, up from 11 per cent in 2022.

According to the data, 20,000 Australians a year received funds from the “bank of mum and dad” to contribute towards their first home, as younger buyers attempt to work around rising costs.

Denox Global Realty sales manager Daniel Ou Yang, based in Sydney, told REB that while many first home buyers have been using the five per cent deposit scheme, those who can benefit from their family’s finances were at a greater advantage.

“The buyers using these government schemes, their budget – it doesn't allow them to access all of the properties, or some of the better properties available in the market.”

“Often, [with] a very attractive listing, which does get quite a bit of competition, it’s the first home buyers that do have support from family or that have larger savings, that end up being the ones that successfully purchase the unit,” he told REB.

He said for agents, it didn’t matter where the money came from as long as buyers had pre-approval.

Yet, having extra funds can help buyers feel more comfortable in their purchase and facilitate the agent's job.

“Sometimes the parents help the buyer with a full cash purchase, and then that way the buyer is a lot more confident in [the] cooling-off period and offering more favourable terms to the vendor. That does help us also select them to be the purchaser,” he said.

“In most circumstances, if you've got the parents' help and push comes to shove, they have to offer 10k, 20k more, it’s a lot easier when you have the support of the family to help you with that 20k.”

Ou Yang said that ultimately, due to the high living expenses in Australia, particularly in Sydney, it has been difficult for any first-home buyer to save up for a suitable property without support.

“I think you either need dual income or you need to have a lot more savings, or you'll need financial support from the family or the government to actually be able to access the market in Sydney,” he said.

The report also found that first-time home buyers who received parental support were generally able to save substantially more on house prices than buyers who did not receive financial assistance from their families.

Buyers who had support from family were also typically two years younger when they entered the market than those without extra help.

Data showed that first home buyers with parental support and a two-year head start could save up to $220,000 on Perth’s median house, $165,000 in Adelaide, $160,000 in Brisbane, and $140,000 in Sydney.

Additionally, receiving help from the bank of mum and dad increased the financial security of first home buyers, with the average assisted buyer having 41 per cent more leftover in their savings after buying their first property.

Receiving parental aid was also found to cut the amount of time required to save for a deposit, with 29 per cent of those who received support taking five years or more to save, compared to 40 per cent of those who did not receive assistance.

In addition to parental support, other ways first home buyers saved up for their deposit included living at home (21 per cent), spending less on eating and drinking out (20 per cent), saving over a period of time (17 per cent), and working a second job (17 per cent).

Finder’s head of consumer research, Graham Cooke, said first home buyers have been facing the brutal reality that housing affordability has deteriorated significantly in the past decade, with rising prices outpacing wage growth.

“Yet despite these hurdles, hundreds of thousands of Australians continue to dive headfirst into the housing market, driven by a complex mix of economic rationale and emotional urgency,” he said.

He noted that the current system was asking too much of buyers, and that owning a home should not require a decade of saving, assistance from parents or accepting mortgage stress as a norm.

“The fact that so many Australians are willing to take on that challenge anyway is a testament to the enduring cultural power of homeownership – and the hope that things might get easier,” he concluded.

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