The bank of mum and dad is now the seventh biggest lender in the UK – so what does that actually means for the property market? John Kelly, Managing Partner, Corum Property explains
There is a statistic circulating within the property industry at present that merits serious consideration. The gifts and loans flowing from parents to their children to facilitate first home purchases now total £9.6 billion annually in the UK.
That figure, were it a mortgage lender, would rank it seventh largest in the country – ahead of many of the banks and building societies whose names appear on high streets across the nation. The informal, undocumented, entirely unregulated transfer of wealth between generations has become one of the most significant forces in the British property market – and it is growing.
One in ten first-time buyers are now purchasing their homes outright with cash – without a mortgage, without a lender, without the requirement to satisfy a stress test. Three years ago that figure was closer to one in twelve. Rising mortgage rates, rising rents, and the considerable difficulty of accumulating a meaningful deposit on a single income have directed more buyers than ever toward the only source of capital that carries neither interest nor a credit assessment, in the form of their parents.
I have been working in the property market across Greater Glasgow and the West of Scotland for nearly four decades. In that time, I have observed the forces shaping who buys, where, and how shift in ways that would have been difficult to anticipate at the outset. What is occurring now is, in my view, one of the most significant of those shifts – and one that warrants considerably more honest examination than it generally receives.
Corum’s managing partner John Kelly (Image: Corum)
The cash buyer – particularly the cash first-time buyer – enters every transaction from a position of considerable strength. No mortgage approval to await, no survey conditions to satisfy and no lender scrutinising a chain.
A clean, fundable, immediate offer that sellers and their agents instinctively trust. In a competitive market, that position is not merely advantageous, it is transformative.
For buyers without parental support – those saving conscientiously, managing their finances responsibly, conducting themselves impeccably and yet finding the deposit target perpetually out of reach – the implications are sobering. They are not competing on equal terms, and the disparity is widening.
The evidence from within our own business is instructive. In Glasgow’s West End, where the concentration of professional families with accumulated wealth makes this trend particularly pronounced, we are observing a meaningful shift in the profile of first-time buyer. A growing proportion of younger purchasers are arriving with cash, or near to it, supported by parental capital at a level that was not commonplace a decade ago.
These are not buyers stretching to reach the first rung of the ladder. They are buyers with genuine purchasing power, precise requirements, and the capacity to proceed without delay. That materially alters the dynamic of every closing date in which they participate.
Across the Southside and the wider suburban market, the same forces are apparent, if less pronounced. Buyers who might previously have been committing to their absolute financial limit are arriving with larger deposits and cleaner positions. When two offers sit before a seller and one requires no mortgage, the deliberation tends to be brief.
There is a further dimension to this trend that receives insufficient attention, yet sits at the heart of a great many of these decisions. For a significant and growing number of parents, gifting capital to their children for a property purchase is not solely an expression of generosity. It is a considered act of estate planning.
Inheritance tax in the United Kingdom is among the most burdensome in the developed world, and the thresholds have failed to keep pace with the appreciation of asset values – most notably residential property – over the past two decades.
For parents who have accumulated substantial wealth, much of it illiquid within a family home, the prospect of a significant portion of that estate passing to the Treasury rather than their children is a powerful incentive to act during their lifetime rather than defer.
Drumellan House, Ayr is on the market for offers over £1,500,000 (Image: Corum)
Gifting capital during one’s lifetime – subject to the seven-year rule which removes the transfer from the taxable estate – has become an increasingly rational and increasingly common response to an inheritance tax framework that a great many families regard as neither equitable nor proportionate.
The bank of mum and dad, therefore, is not simply a manifestation of parental affection. It is also a direct consequence of a fiscal environment that makes early wealth transfer the logical course of action for those with the means to pursue it.
The rise of the mortgage-free first-time buyer is not, in itself, cause for alarm. Capital entering the property market, transactions concluding cleanly, parents facilitating opportunities for their children – none of this demands censure. What it does demand is candour. About the structural advantage it confers.
About what it signifies for those without access to such support. About a market in which the informal transfer of generational wealth is becoming one of the principal determinants of who buys, where, and when.
The property ladder has not disappeared. Certain rungs, however, have become considerably more difficult to reach without assistance. As for the parents quietly ensuring their children need not attempt the climb unaided, the motivation is increasingly as strategic as it is familial.
Why the property market’s summer lull is a myth
EVERY year, as the school holidays approach, the same narrative surfaces across the property industry.
The market is quietening, with buyers distracted and sellers waiting until September. It is a line repeated so regularly it has become accepted wisdom, but the figures tell us a that it is also, in large part, wrong.
Makerston House, Park Road, Paisley is on the market at offers over £900,000 (Image: Corum)
The assumption that summer brings a meaningful pause in buyer activity misunderstands something fundamental about who is still searching. This is not a market in which serious buyers take extended breaks; the buyers active in July and August are not casual browsers.
They are committed, motivated, and in many cases have already missed out more than once. The numbers from last year make the case clearly. Between May and June 2025, Corum recorded 8,014 viewings and 1,564 offers from 422 listings. Between July and August, viewings fell to 6,999 – on the surface, evidence of a slowdown. But offers came in at 1,384 from just 361 listings.
A smaller pool of viewers, but a stronger ratio of serious intent within it. The volume softens, but the quality of buyer does not.
The people coming through doors in July and August are families needing to be settled before the new school year, or even by Christmas, professionals who have been searching since January and cannot afford to stop, and buyers who have already sold and are living on a deadline the calendar does not accommodate.
These are precisely the buyers any seller wants at their door.
For sellers weighing whether to come to market now or wait until autumn, the calculation is straightforward.
Summer brings reduced competition from other sellers, a more concentrated and committed buyer pool, and the genuine possibility of concluding a sale before the autumn market arrives with renewed supply and renewed noise.
The seller who comes to market well priced and well presented in July is, in many respects, in a stronger position than the one who waits until the busier Autumn market.
