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Australian financial advisor platform, Mozo, has found young first home buyers turning to their parents for help, resulted in the ‘bank of mum and dad’ becoming Australia’s 5th biggest lender.
With property prices increasing and income growth lagging behind, millennials are finding it harder and harder to get onto the property ladder. Mozo’s Kirsty Lamont highlights that this issue has led to the rise of parents lending to their children, whether it be for a deposit or home loan repayments.
This can be seen through Moz’s research, showing that in 1986, the average price of a property was $76,278, which was the equivalent of 4.4 times the average income of $17,321 per year. In 2016, the average house price rose to $547,714, which was 6.9 times the average annual income of $78,832.
Mozo further highlights that ‘the bank of mum and dad’ in Australia has lent $65.3 billion to young home buyers annually. With 29% of parents in Australia assisting their children in purchasing a property. Overall 67% of those parents that do lend to their children don’t expect to be repaid.
Mozo then highlights through analytics the contribution family lending has on the market.
Read the article in full by clicking the link below.
Credit: Kelly Emmerton
Source: www.mozo.com.au/
Tim K. Dean, Credi Founder | Commentator & Expert on Family Lending, Bank of Mum & Dad and Neo-Credit Scores is available for media interviews and appearances. More…
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Sign up and become one of the thousands of people and business around the world using Credi to protect them selves with robust loan documentation and management today.
Sign up and become one of the thousands of people and business around the world using Credi to protect them selves with robust loan documentation and management today.