The Bank of Mum and Dad provided £9.4 billion to their children last year to assist in buying homes—a sum nearly double what it was five years ago.

According to an analysis of UK Finance data by Savills, nearly 57% of mortgaged homebuyers in 2023 received familial financial aid, totaling 164,000 individuals. This marks the first instance since 2013, the year the Help to Buy scheme was launched, where more than half of new buyers utilized family support.

Help to Buy, which concluded on March 31 last year, offered buyers of new homes a government loan of up to 40% with no interest for the first five years. While the scheme enabled 328,346 first-time buyers to purchase homes worth £24.7 billion, it also indirectly raised prices, earning it the nickname ‘Help to Sell’ among critics. The Times has reported that while the previous government considered reviving the scheme, the new Labour administration aims to overhaul the planning system and build more homes.

Frances McDonald, Director of Residential Research at Savills, stated, “With no clear replacement for the support provided, a larger proportion of buyers now rely on family to step onto the property ladder.”

In 2023, £9.4 billion was given to first-time buyers to mitigate high property prices and soaring mortgage rates, up from £8.9 billion the previous year and £5 billion in 2019, according to Savills.

McDonald noted that significant rent increases last year also made it difficult for tenants to save for home purchases. “Record rental growth and increased mortgage rates have further hindered first-time buyers’ aspirations,” she added. “Consequently, more people needed family support to secure lower mortgage rates.”

The struggle for new rental properties continues as fewer tenants transition to homeownership. Hello Neighbour, a landlord platform, reported 52 viewing requests per property in July, with higher figures in more affordable areas like Havering, East London, seeing 216 requests per property.

Savills projects that the percentage of first-time buyers receiving parental help will decrease to 54% this year and 51% next year, stabilizing at 50% by 2026. However, as the property market accelerates, the actual number of recipients is expected to grow to 170,000 by 2026.

Future predictions suggest families will contribute an additional £30 billion to first-time homebuyers over the next three years as mortgage rates remain elevated. The so-called Bank of Mum and Dad will continue to be a significant funding source. As of July, the average interest rate for a mortgage with a 10% deposit was 5.66%, and 6.08% for a 5% loan—approximately double the rates from summer 2022. McDonald states, “Despite the Bank of England’s recent rate cuts, lenders will likely continue favoring less risky, larger deposit lending options.”