Current market trends, such as rising property prices and the high cost of living, have made it increasingly difficult for first-time buyers to enter the housing market, especially in big cities like Sydney and Newcastle.
Even with pre-approval and a stable income, many young buyers struggle to meet the deposit requirements for home loans. The “Bank of Mum and Dad” has become the go-to for many, with parents stepping in to help cover deposits, offer loans, or act as guarantors to support their adult children’s property investment goals.
With more than 60% of first-time home buyers in Australia receiving help from the Bank of Mum and Dad in 2025, this source of financing is playing a growing role in shaping how home loans are secured, particularly in regional areas where affordability meets opportunity.
The Bank of Mum and Dad in Australia: A Guide for Property Investors
Financial support from one’s parents can take many forms. It could be an outright gift, a private loan, or acting as a guarantor. In regional areas, where entry prices are lower and rental yields can be more attractive, this support often goes further.
Deposits are one of the main ways that parents are helping, especially for first-time buyers who are juggling rising living costs.
When parents act as guarantors, usually for the deposit portion, they allow their children to access competitive home loans without needing to save the full 20% upfront. This can dramatically reduce the time it takes to enter the market and begin building equity.
Family Guarantees Or Bank of Mum and Dad
Guarantees are typically limited to the deposit amount, which helps to reduce the risk to the parents’ own finances. Although it’s not a blanket liability, it’s still serious business. Loans backed by family assets or equity need careful planning and clear boundaries.
Legal and financial advice is essential before entering any agreement. Parents should understand their obligations and structure the guarantee in a way that protects their future. At the same time, children must treat the arrangement with the same respect they would give to any other lender.
The Bank of Mum and Dad — Securing Finance
Government schemes like the Regional First Home Buyer Guarantee can work hand in hand with family guarantees. These options may help cover part of the deposit, lower the upfront costs, and open access to better loan terms.
Still, regional markets have unique risks, such as zoning restrictions, lender requirements, and potential environmental limitations.
That’s why good investment advice is key. Understanding how loans, guarantors and property market trends interact can help families make smart decisions that benefit everyone.
Thinking about using a family guarantee to support your property investment? Contact WPG Advisory for expert advice on home loans, deposits and market trends.