Grandparents are saving families $88 million in childcare costs in NSW each year, with nans and pops in affluent suburbs more likely to be left holding the babies.
About 200,000 grandparents provide 12.7 hours of unpaid, informal care for children in NSW each week, according to research by the Council of the Ageing NSW (COTA NSW).
About 10 per cent of people aged over 65 look after their grandchildren while in some Sydney electorates almost one in five grandparents provide regular unpaid childcare.
"It's clear that many step in to make sure that their families can afford to stay in the area, often needing both mum and dad to work to keep up with mortgage payments and other costs," COTA NSW's CEO Ian Day said.
Grandparents in affluent suburbs are more likely to be part-time carers and Sydney's northern suburbs and the Hills District boast the highest number of elderly babysitters.
"[This] suggests that even higher earning families need grandparents to fill crucial care roles to meet living expenses," COTA said in a statement.
Topping the list of grandparents providing regular unpaid care are those in Davidson and Baulkham Hills followed by Cronulla and Menai in Sydney's south.
Overall, the report estimates grandparents in NSW are saving families $1.8 million a week or $88 million a year in childcare.
Mr Day said grandparents provided a number of types of support - from looking after sick kids to going to their sports and extra-curricular activities and taking care of them during school holidays.
"It isn't just the financial support that grandparents are providing through their care, grandparents provide very special emotional support, security, personal attention, intergenerational sharing, and love," he said in a statement on Monday.
Up to 15,000 grandchildren are permanently living with their grandparents, who as a group provide the most out-of-home care for children unable to live with their parents.
Sylvia Payten frequently cares for five of her 10 grandchildren living nearby in Manly.
"We help keep the wheels on the cart," she said.
"My daughter could not afford to pay for care and she also needed someone who could care for the kids when she was busy.
"It wasn't a situation that lent itself to putting the kids in formal child care, even if she and her husband could have afforded it." AAP