Finder’s RBA Survey: Experts question the ‘bank of mum & dad’ impact ahead of cash rate call
Ahead of tomorrow's RBA rate decision, economists are divided on the influence of the bank of mum and dad, with some warning it's pushing prices up.
In this month's Finder RBA Cash Rate Surveyâ„¢, 35 experts and economists weighed in on future cash rate moves and other issues relating to the state of the economy.
The majority of experts (86%, 30/35) are predicting a cash rate hold from the RBA this month, keeping it at 3.60%.
Panellists weigh in on the 'bank of mum & dad'
Finder's First Home Buyer Report 2025 – based on a survey of 1,006 first home buyers in Australia – revealed almost 1 in 5 (17%) first home buyers relied on the financial help of mum and dad to save their deposit, up from just 11% in 2022.
That's almost 20,000 first home buyers a year who were lucky enough to receive financial assistance from their parents.
Graham Cooke, head of consumer research at Finder, said family support had become a crucial step to home ownership for many Australians.
"For many young buyers, purchasing property without assistance feels almost impossible.
"Those who can lean on mum and dad are typically entering the market not just sooner, but in a much stronger position.
"This adds to the inequality in the market for those who don't have this option," Cooke said.
Nearly 1 in 3 experts who weighed in* (31%, 8/26) believe the 'bank of mum and dad' is distorting the property market.
Scott Kuru from Freedom Property Investors said, "It's clear many younger people are only getting into the property market with help from older (and usually cashed up) family members."
Mala Raghavan from the Tasmanian School of Business and Economics agreed.
"With a limited housing stock in the market, any demand-driven actions are bound to distort house prices," Raghavan said.
Michael Yardney from Metropole Property Strategists said more first-home buyers are counting on the bank of mum and dad to help them with a deposit, which is the biggest hurdle for getting into the housing market for many young families.
"This is creating a two-tier market of the haves and have-nots, families with property equity already and others," Yardney said.
Stella Huangfu from the University of Sydney said the bank of mum and dad is distorting the property market by giving some buyers extra purchasing power, allowing them to bid higher and enter the market sooner.
"This pushes up prices, especially in already competitive areas. It also deepens inequality, as those without family support are left further behind," Huangfu said.
On the other hand, Tim Reardon from the Housing Industry Association said family support is a natural part of a well functioning market.
"[Parents] are not a distortion, they are correcting the market distortion created by the severe lending restrictions imposed on first home buyers," Reardon said.
Garry Barrett from the University of Sydney said intergenerational transfers have always occurred.
Craig Emerson from Emerson Economics agreed, noting "There have long been mums and dads."
2 in 3 experts (65%, 17/26) believe the government's expansion to the First Home Guarantee Scheme will encourage first home buyers to take on more debt than they should.
*Experts are not required to answer every question in the survey.
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