Those who receive a gift of $5000 or more from a parent are much more likely to own a home than others. But the trend for parents to give their children handouts to help break into the property market is increasing wealth inequality. 
New modelling by economists from Sydney University and RMIT University shows about one in 20 Australians receive funds from their parents specifically for home ownership each year.
These "inter vivos transfers" - made during a parent's lifetime - were found to have "large impacts" on home ownership rates.
Parental gifts of $5000 or more lifted the home ownership rates of beneficiaries aged between 25 and 65 years by 14 percentage points compared to the rate that would be achieved had no transfer been received. The effect of parental gifts on ownership among those aged under 45 was even more pronounced.
The nationwide study found the average parental gift was $13,500 and the average recipient was in their mid-30s.
But the modelling revealed that gifts and bequests from parents to children had increased the level of wealth inequality between 2002 and 2010. There was also a widening gulf between home owners and renters in access to wealth.
"There is evidence that those in rental tenures are less likely to receive transfers and benefit from the increased opportunities that come with such transfers," the study by Garry Barrett, Melek Cigdem, Stephen Whelan and Gavin Wood for the Australian Housing and Urban Research Institute said.
There has been a sharp fall in home ownership rates in younger age groups. The last census showed that three in four people aged over 55 years were owner-occupiers compared with only one in three among under-35s. The rate of ownership among under-35s has fallen 22 percentage points over the past three decades.
"The Baby Boomer generation has benefited from relatively good postwar economic conditions, which underpinned increasing rates of home ownership and the accumulation of wealth through an asset that had preferential tax treatment," the report said. "But this has seemingly been at the expense of their children's home ownership prospects."
The study also examined how bequests affected ownership patterns. It found that outright home ownership was 10 percentage points higher among Australians aged 25 to 65 who have received a bequest.
The authors say housing policies should be revamped in the light of the findings. Strategies to boost home ownership rates should target groups that are unlikely to benefit from parental gifts and other intergenerational transfers.
It may also be possible for policies to help "unlock" the wealth holdings held by older generations so as to directly benefit younger generations. This might also reduce pressure on government budgets.