With property prices soaring, it can seem impossible to get onto the ladder without the ‘Bank of Mum and Dad’.
As Aussie house prices skyrocket, more first-home buyers are turning to the ‘Bank of Mum and Dad’ to help get a foot onto the property ladder but not everyone is as fortunate.
Aussies have revealed the exact amount their parents have gifted them, with some receiving hundreds of thousands of dollars.
One social media user said their parents gifted them $140,000 to help them purchase a block of land and later gifted their sibling $170,000 for them to also buy land.
Another said they received around $100,000 from their parents and mother-in-law: “I still feel bad about it but at least their grandkids have a decent place to live.”
Another person said they felt “guilty” after getting $145,000 in cash from their parents to purchase a two-bedroom unit in Adelaide.
“Completely life-changing and something I feel a lot of guilt over when looking at the problems a lot of my friends are having in the current rental market,” they said.
Other amounts were comparatively smaller – around the $5,000-$10,000 mark – while others said their parents matched the deposit they had saved up.
“I think I had $40,000 at the time. Mum and Dad matched and [that] allowed me to purchase [my] first place for a bit under $400,000. Very lucky and thank them all the time. Will do the same for my kids,” they said.
Other Aussies got a leg-up by living with their parents rent free, giving them more breathing room to save up.
“This is really a massive one that many don’t even include. Being able to forgo even $200 a week in rent is like having an extra 40-50k after a few years,” one user said.
Bank of Mum and Dad
While it may seem like most people are getting parental assistance to get onto the property ladder, recent research actually suggests otherwise.
Just 11 per cent of households received financial assistance from their parents, a Finder survey of 1,096 respondents found. The average amount? $56,231.
About 35 per cent of first-home buyers said they didn’t receive any cash from their parents, but this included 12 per cent who still received assistance in other ways. Another 36 per cent said they didn’t want their parents to pitch in at all.
The average deposit for a first-home buyer is almost $119,000 – more than the average full-time salary of $94,000. This would take the average buyer more than 12 years to save up.
Finder home loan expert Richard Whitten said hopeful home-buyers needed to try “every trick in the book” to save up for a home deposit faster.
He urged Aussies to look for a high-interest savings account to stash their cash, with some offering interest rates of 5.5 per cent or more.
It’s also worth seeing if you are eligible for any first-home buyer schemes and incentives, he said, and looking into the First Home Super Saver Scheme.
“Getting your parents to go guarantor can be an option for some buyers if direct financial support is out of the question,” Whitten said.