Many Australian parents are putting off hanging up their work hats for a few more years so they can help their children become first homebuyers.
New research from homeloans.com.au has found that almost two in three parents (65%) are making financial and personal sacrifices to help their children or grandchildren with home ownership plans, now or in the future. More than one in four (29%) of these parents are prepared to retire later than planned in order to provide financial assistance.
Homeloans.com.au head of marketing, Will Keall, said that the 2018 Generational Property Ladder Survey highlights just how far parents will go to help secure their children’s future:
“Due to tougher mortgage lending standards it’s increasingly difficult for younger generations to break into the property market. To help with this, parents are doing what they can to help their children become first homebuyers, from cutting back on their own spending to going guarantor on a loan.”
Breaking down the figures
Of the 1072 parents and grandparents surveyed in July 2018:
- 39% are willing to live more simply by sacrificing small luxuries like going to restaurants or movies
- 33% are willing to delay big expenses like holidays or a new car
- 30% are willing to dip into their hard-earned savings to provide financial assistance
- 26% of parents that are currently providing assistance have dipped into savings to do so
- 10% are willing to refinance their own mortgage to free up cash
- 49% have given cash gifts to help their children or grandchildren buy a home
- 60% of respondents looking to provide a boost would consider a cash gift
- 16% have provided an interest free loan
- 35% of respondents looking to provide a boost would consider an interest free loan
- 46% would let their children or grandchildren move into the family home while saving for a deposit
- 36% are willing to be a guarantor on a loan from a financial institution
- 32% are willing to purchase a home in partnership with their children or grandchildren
- 13% have set up a trust fund for their children
