Latest news with #Mozo
News.com.au
11-05-2025
- Business
- News.com.au
Bank of mum and dad making huge sacrifices to get kids on the property ladder
Younger Australians are increasingly turning to the bank of mum and dad to take their first steps onto the property ladder, but even with a leg up many are struggling to raise enough money to buy in Australia's capital cities. Survey data released by comparison site Mozo shows more than one in three first home buyers needed parental assistance. 'Despite these large contributions, Mozo modelling shows a $74k gift is often still not enough to cover a 20 per cent deposit on median homes in Sydney or Melbourne, especially with stamp duty and other upfront costs factored in,' the Mozo report said. 'Dual incomes remain essential and many first home buyers still fall short of lending thresholds even with family support.' According to Mozo, that was $4,113 more than in 2021. And 75 per cent of parents who had backed a deposit did not expect to be repaid, up from 33 per cent over the same period. PropTrack data confirms this, showing Australia's median house price is already at a record high in April, rising 0.2 per cent to $805,000, although prices in Australian cities are more expensive. An average house price in Sydney now costs buyers $1.18m, while Australia's second most expensive city Brisbane costs $882,000 and the ACT will cost buyers on average $852,000. Since March 2020 during the depth of the Covid lows, house prices nationally have recovered by 48.6 per cent, putting more pressure on those looking to get into the market. REA Group senior economist and report author Anne Flaherty said one positive for those looking to get into the market was house price growth was slowing. 'While national home prices rose in April, the rate of growth has slowed compared to the first three months of the year,' she said. 'Should interest rates fall in May, we may see the rate of growth pick up again as borrowing capacities increase and mortgage repayments decline.' More than half of the parents who did help their children had to dip into their savings, while 14 per cent are putting off their own retirement or accessed their superannuation to help the children. Even though parents are willing to sacrifice to help their own children, when asked if they were willing to sell the family home, the majority answered no. 'Interestingly, while financial support from parents has increased, fewer parents are willing to make extreme sacrifices to fund their children's homeownership goals,' Mozo's report said. Despite the large sums of money given from parent to child, Mozo's data warns there is a lack of any formal agreement or protection. 'That leaves both parties exposed if circumstances change. As house prices continue to outpace wage growth, the role of the 'Bank of Mum and Dad' is becoming both more vital and more financially perilous,' the report said.
Mercury
10-05-2025
- Business
- Mercury
Mozo report reveals bank of mum and dad for property
Don't miss out on the headlines from Property. Followed categories will be added to My News. Younger Australians are increasingly turning to the bank of mum and dad to take their first steps onto the property ladder, but even with a leg up many are struggling to raise enough money to buy in Australia's capital cities. Survey data released by comparison site Mozo shows more than one in three first home buyers needed parental assistance. 'Despite these large contributions, Mozo modelling shows a $74k gift is often still not enough to cover a 20 per cent deposit on median homes in Sydney or Melbourne, especially with stamp duty and other upfront costs factored in,' the Mozo report said. Australian parents have been asked on average to give their children $74K. Picture: NewsWire / Nicholas Eagar 'Dual incomes remain essential and many first home buyers still fall short of lending thresholds even with family support.' According to Mozo, that was $4,113 more than in 2021. And 75 per cent of parents who had backed a deposit did not expect to be repaid, up from 33 per cent over the same period. PropTrack data confirms this, showing Australia's median house price is already at a record high in April, rising 0.2 per cent to $805,000, although prices in Australian cities are more expensive. The new bank of mum and dad does not expect to be paid back. Picture: Mozo An average house price in Sydney now costs buyers $1.18m, while Australia's second most expensive city Brisbane costs $882,000 and the ACT will cost buyers on average $852,000. Since March 2020 during the depth of the Covid lows, house prices nationally have recovered by 48.6 per cent, putting more pressure on those looking to get into the market. REA Group senior economist and report author Anne Flaherty said one positive for those looking to get into the market was house price growth was slowing. 'While national home prices rose in April, the rate of growth has slowed compared to the first three months of the year,' she said. 'Should interest rates fall in May, we may see the rate of growth pick up again as borrowing capacities increase and mortgage repayments decline.' The bank of mum and dad is still not enough for a deposit in major capital cities. Picture: NewsWire / Max Mason-Hubers More than half of the parents who did help their children had to dip into their savings, while 14 per cent are putting off their own retirement or accessed their superannuation to help the children. Even though parents are willing to sacrifice to help their own children, when asked if they were willing to sell the family home, the majority answered no. Aussie parents are less willing to downsize their home: Picture. Mozo 'Interestingly, while financial support from parents has increased, fewer parents are willing to make extreme sacrifices to fund their children's homeownership goals,' Mozo's report said. Despite the large sums of money given from parent to child, Mozo's data warns there is a lack of any formal agreement or protection. 'That leaves both parties exposed if circumstances change. As house prices continue to outpace wage growth, the role of the 'Bank of Mum and Dad' is becoming both more vital and more financially perilous,' the report said.
Sky News AU
10-05-2025
- Business
- Sky News AU
Mozo report reveals bank of mum and dad for property
Younger Australians are increasingly turning to the bank of mum and dad to take their first steps onto the property ladder, but even with a leg up many are struggling to raise enough money to buy in Australia's capital cities. Survey data released by comparison site Mozo shows more than one in three first home buyers needed parental assistance. 'Despite these large contributions, Mozo modelling shows a $74k gift is often still not enough to cover a 20 per cent deposit on median homes in Sydney or Melbourne, especially with stamp duty and other upfront costs factored in,' the Mozo report said. 'Dual incomes remain essential and many first home buyers still fall short of lending thresholds even with family support.' According to Mozo, that was $4,113 more than in 2021. And 75 per cent of parents who had backed a deposit did not expect to be repaid, up from 33 per cent over the same period. PropTrack data confirms this, showing Australia's median house price is already at a record high in April, rising 0.2 per cent to $805,000, although prices in Australian cities are more expensive. An average house price in Sydney now costs buyers $1.18m, while Australia's second most expensive city Brisbane costs $882,000 and the ACT will cost buyers on average $852,000. Since March 2020 during the depth of the Covid lows, house prices nationally have recovered by 48.6 per cent, putting more pressure on those looking to get into the market. REA Group senior economist and report author Anne Flaherty said one positive for those looking to get into the market was house price growth was slowing. 'While national home prices rose in April, the rate of growth has slowed compared to the first three months of the year,' she said. 'Should interest rates fall in May, we may see the rate of growth pick up again as borrowing capacities increase and mortgage repayments decline.' More than half of the parents who did help their children had to dip into their savings, while 14 per cent are putting off their own retirement or accessed their superannuation to help the children. Even though parents are willing to sacrifice to help their own children, when asked if they were willing to sell the family home, the majority answered no. 'Interestingly, while financial support from parents has increased, fewer parents are willing to make extreme sacrifices to fund their children's homeownership goals,' Mozo's report said. Despite the large sums of money given from parent to child, Mozo's data warns there is a lack of any formal agreement or protection. 'That leaves both parties exposed if circumstances change. As house prices continue to outpace wage growth, the role of the 'Bank of Mum and Dad' is becoming both more vital and more financially perilous,' the report said.
Perth Now
10-05-2025
- Business
- Perth Now
Insane bank of mum and dad cost revealed
Younger Australians are increasingly turning to the bank of mum and dad to take their first steps onto the property ladder, but even with a leg up many are struggling to raise enough money to buy in Australia's capital cities. Survey data released by comparison site Mozo shows more than one in three first home buyers needed parental assistance. 'Despite these large contributions, Mozo modelling shows a $74k gift is often still not enough to cover a 20 per cent deposit on median homes in Sydney or Melbourne, especially with stamp duty and other upfront costs factored in,' the Mozo report said. 'Dual incomes remain essential and many first home buyers still fall short of lending thresholds even with family support.' According to Mozo, that was $4,113 more than in 2021. And 75 per cent of parents who had backed a deposit did not expect to be repaid, up from 33 per cent over the same period. PropTrack data confirms this, showing Australia's median house price is already at a record high in April, rising 0.2 per cent to $805,000, although prices in Australian cities are more expensive. The new bank of mum and dad does not expect to be paid back. Mozo Credit: Supplied An average house price in Sydney now costs buyers $1.18m, while Australia's second most expensive city Brisbane costs $882,000 and the ACT will cost buyers on average $852,000. Since March 2020 during the depth of the Covid lows, house prices nationally have recovered by 48.6 per cent, putting more pressure on those looking to get into the market. REA Group senior economist and report author Anne Flaherty said one positive for those looking to get into the market was house price growth was slowing. 'While national home prices rose in April, the rate of growth has slowed compared to the first three months of the year,' she said. 'Should interest rates fall in May, we may see the rate of growth pick up again as borrowing capacities increase and mortgage repayments decline.' The bank of mum and dad is still not enough for a deposit in major capital cities. NewsWire / Max Mason-Hubers Credit: News Corp Australia More than half of the parents who did help their children had to dip into their savings, while 14 per cent are putting off their own retirement or accessed their superannuation to help the children. Even though parents are willing to sacrifice to help their own children, when asked if they were willing to sell the family home, the majority answered no. Aussie parents are less willing to downsize their home: Picture. Mozo Credit: Supplied 'Interestingly, while financial support from parents has increased, fewer parents are willing to make extreme sacrifices to fund their children's homeownership goals,' Mozo's report said. Despite the large sums of money given from parent to child, Mozo's data warns there is a lack of any formal agreement or protection. 'That leaves both parties exposed if circumstances change. As house prices continue to outpace wage growth, the role of the 'Bank of Mum and Dad' is becoming both more vital and more financially perilous,' the report said.
Yahoo
03-05-2025
- Business
- Yahoo
The only Aussie bank that doesn't expect repayments
Australian parents are digging deep into their pockets to help their children get onto the property ladder, but the way they're doing it has changed dramatically. The Bank of Mum and Dad has now turned into the Gift from Mum and Dad. Financial site Mozo has discovered 75 per cent of parents are giving their kids money for a home deposit without expecting it to be repaid down the line. That's a massive jump from the 33 per cent who said the same back in 2021. Rachel Wastell, Mozo's personal finance expert, told Yahoo Finance this is a "significant generational shift" in the way that the Bank of Mum and Dad is now operating. But she warned several pitfalls are emerging as a result of this change. Mums and dads warned early inheritance cash boost for struggling kids could impact pension Woolworths worker with three jobs shares bank balance as average Aussie savings revealed Banks reveal impact after Aussies try to drain ATMs in cashless protest Mozo's research found parents are now giving, on average, $74,040 to their child to help them get on the property ladder. That can be a game-changing amount of money to someone, and can get them across the line to secure the keys to their castle. But Wastell told Yahoo Finance that it's only one piece to the mortgage puzzle."It's exciting to get a gift, obviously, and to be able to get that deposit, but if it gives you a false hope that you can afford more than you can, does that put you in a sticky predicament later?" she said. She said it's really important to look at a mortgage as the weekly, fortnightly, or monthly repayments, rather than just the property price and deposit that's needed. "You really need to sit down and say, 'Okay, can I can I afford this loan?'" Wastell said. "Not just at the rate that's being offered, but if the rates change." One in three parents feel some sort of emotional pressure to become the Bank of Mum and Dad when their kids are buying property. But some are going to extreme lengths in order to provide. Mozo's report found 3 per cent of parents are taking out a loan themselves or using a credit card to give their kids the cash boost. This statistic left Wastell "shocked". "If you are a parent who is putting yourself into high-risk debt situations to help your children get on the property ladder, I think you need to be very concerned about that," she told Yahoo Finance. "If you can't repay that and you're getting into credit card debt to help your child, I just it's a it's a bad situation." The personal finance expert has also heard anecdotally that parents are delaying their own retirements in order to give their kids a leg up. "What happens if you get yourself into so much to helping your children that they then have to turn around and try and help you?" she said. "There's a whole range of kind of risky situations that could happen there. "The support is great, but just make sure, if you are a parent, that you can afford it." Gifting $74,040 is no small chunk of change. Back in 2021, the average loan from the Bank of Mum and Dad was $69,907. But Mozo found that because Aussie house prices have soared by 51 per cent in the last five years, a 20 per cent deposit has increased by $66,160 over the same period. Just over half (54 per cent) of parents said their cash boost to their kids came from savings, while 29 per cent came from their income. The third most popular form was cutting back on personal expenses (19 per cent), while an early inheritance and acting as guarantor came in joint fourth at 8 per cent. Four per cent of parents are either delaying their retirement or selling their assets to help out. Back in 2021, 33 per cent of parents didn't expect to be repaid for their gift, 22 per cent expected full payment plus interest, and 25 per cent wanted to be repaid without interest. Fast forward to 2025, that's now changed to 75 per cent not expecting repayment, 3 per cent want it all back plus interest, and 12 per cent are just happy with being repaid without interest. Nearly a quarter (23 per cent) of parents have also allowed children to live at home rent-free while they saved for a deposit, which is up from 15 per cent in 2021. Interestingly, that cost to parents has dropped dramatically. The cost of having kids live rent-free with them was $13,845 in 2021, but only $6,226 this year. "The shift suggests that while the trend of providing free accommodation to children is more common, parents may be opting for a 'set them up and send them off' approach," Wastell said. "Perhaps parents are offering this support for shorter periods, or with tighter budgets, as larger upfront gifts become the norm."
