BANK OF MUM & DAD
THE BANK OF MUM AND DAD: OPEN FOR BUSINESS
The Bank of Mum and Dad is so popular it even has its own acronym: BOMAD. But why are first time buyers so reliant on financial support from the older generation, and how much help do they really need? Debbie Clark delves into the statistics to see how trends have changed, and why where you buy will have a huge impact on the level of support you require
Parents have been helping their children get a foot on the ladder for years and while we would all love to be able to get there without help, the reality is that in 2025 saving for a deposit is a gargantuan task. Any help we can get is therefore gratefully received! According to the latest analysis from Savills, gifts and loans from the Bank of Mum and Dad (BOMAD) totalled £9.6bn in 2024, with 173,500 first time buyers receiving, on average, a whopping £55,572. This equates to just over half (52%) of all first time buyers, which, although lower than the proportion that received assistance in 2023 (57%), is still higher than every other year since 2012 (53%). Levels of support from the BOMAD have rocketed recently, with assistance paid out since 2021 totalling £38.5bn – 71% more than the previous four years – as a result of a more stringent mortgage market and higher mortgage rates. “First time buyers are still feeling the impact of higher mortgage rates and tougher lending criteria, meaning that a greater proportion have needed support to get on to the housing ladder, and those who were able to, took advantage of greater family support to try and secure a deal at a lower mortgage rate,” says Lucian Cook, Head of Residential Research at Savills. How many buyers need assistance, and how much they require, varies dramatically by region. In London, average first time buyer incomes are typically the highest earned nationwide, but this does not translate to higher levels of homeownership, as incomes still struggle to keep pace with rising deposit requirements. “Here, the average deposit as a percentage of income is 138%,” explains Cook. “This is far beyond what most average buyers can save for independently, meaning that it is
low or no rent to their parents while they focused on building up a deposit. And arguably nothing is quite as motivating as living back at home! Others still will have no family support at all, but were able to take advantage of Government schemes and developer incentives to help keep their deposits as low as possible. The relaxation of mortgage stress tests is also expected to make life that little bit less stressful for first time buyers, and possibly their parents too! Cook says, “Relaxation of mortgage stress tests is expected to boost borrowing by lowering the barrier for entry and allowing first time buyers to qualify for larger mortgages. So, although more first time buyer activity may mean more Bank of Mum and Dad assistance, this is likely to be at a lower average cost per first time buyer.”
incredibly difficult for buyers to get a foot on to the ladder without receiving help.” In the South East, the average deposit as a percentage of income is 98%, and the South West and East of England are not far behind at 94% and 91% respectively. Unsurprisingly, it is buyers in these areas who are most in need of a withdrawal from the BOMAD. In contrast, parents in the North East can sleep safely in the knowledge that the average deposit as a percentage of income in the region is 56% so their children will likely need less financial support. Of course, the reality is that not all of us are fortunate to have parents with savings to support us. What about the 48% of buyers who didn’t have that helping hand last year? Many more will have benefited from moving back home in order to save, paying
24 First Time Buyer August/September 2025
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