“With housing costs sky high it’s not surprising that the Bank of Mum and Dad is no longer just relied on for help with buying a home, but renting costs too.”

Campbell Robb, chief executive, Shelter

The “Bank of Mum and Dad” will help finance 25% of UK mortgage transactions this year, according to research conducted by Legal & General.

It is estimated that UK parents lend their children £5bn (R94bn) each year to help them gain a foothold on the property ladder. Combining their lending power would make the “Bank of Mum and Dad” one of the top 10 mortgage providers.

Parental funding provides deposits for more than 300 000 mortgages each year, facilitating the purchase of homes worth £77bn (R1 447bn). The average contribution is estimated at £17 500 (R330 000) - or 7% of the average purchase price.

A recent government housing survey reveals that the number of first-time buyers who rely on the “Bank of Mum and Dad” has risen sharply over the past decade – with 27% of first-time buyers relying on family or friends to assist them with a deposit last year. In addition, more people are using inherited money for their first purchase while a growing number are teaming up with a partner.

Despite government programmes like Help to Buy, the total number of people buying a home for the first time has fallen by a third during the past decade, while the average age of first-time buyers has risen from 30 to 33 years during that period.

Now it has been revealed that Britain’s housing crisis has become so severe that the “Bank of Mum and Dad” has had to extend into the private rentals market as well.

It is estimated that parents are subsidising their adult children’s rent to the tune of £1bn (R19bn) a year – with 450 000 UK adults requiring parental assistance to remain in their rented homes.

Research suggests that the combination of falling homeownership levels and escalating rentals mean that today’s millennials will pay an estimated £53 000 (R1 million) in rent before their 30th birthday. In contrast, the baby boomers (those born between 1946 and 1965) typically spent £9 000 in today’s money.

Just under two-thirds of baby boomers owned their own home by the time they reached the age of 30, compared with just 42% of the millennial generation. Decades of rising prices and declining house building are among the biggest reasons for the shift in home ownership patterns.

So, while young people are spending more of their disposable income on rent and finding it harder to save for a deposit, baby boomers are the most likely to be landlords and benefit from the strong rental market. An estimated 39% of landlords are baby boomers, receiving a 50% share of all UK rental income.

While the “Bank of Mum and Dad” plays a vital role in helping young people take their first steps on the housing ladder, not all young people have parents who can afford to help them and some who do, still do not have enough to buy a place of their own.

The nation’s housing crisis is perhaps the most visible example of growing inequality between generations, as the drop in home ownership leads to a concentration of wealth among older people.

Britain’s new Prime Minister Theresa May has spoken of the need to address the “housing deficit” – noting that the drastic shortage of genuinely affordable homes means for millions of people finding a home is fast becoming out of reach.

Prepared by Sandra Gordon | Research and Market Analyst at Pam Golding Properties