Tuesday 12 September 2023

Why more and more Mums and Dads are Buying Homes for Adult Children

With the Sydney property market pricing so many young adults out of the market, and with rental costs increasing astronomically, more parents than ever before are taking the proverbial bull by the horns and purchasing a property for their offspring. Recent sales indicate a definite trend showing parents are buying property for their children, either in their own name, the child’s or the family trust.

With soaring rental costs at times outweighing mortgage repayments, parents are seeing the sense in investing in a home for their child. Oftentimes, parents purchase the property and the adult child pays the mortgage or a least the majority of it. But there are some cases where parents are buying a property outright for their child to give them housing security.

There are a few recent cases where a parent has purchased an entire block for their children. For example a local family paid over $5 million for a block of four two-bedroom apartments in Randwick. With a crowd of over a hundred, local families were the most interested bidders, respectively attempting to secure the block for their adult children.

In another case, a father was the successful bidder at the auction of a Chiswick home, paying a massive $4 million so his daughter could live in the same street. And a concerned father bought a Paddington terrace for his children in their 20s. He paid a sizeable $3.8 million to stop them having to pay ever increasing rents.

Sydney University, Camperdown

University of Sydney AHURI research centre director and senior lecturer in urbanism, Dr Laurence Troy, said the university’s recent paper concluded that most young people were unable to purchase their first home without family support. “We now have a system of homeownership based on inherited wealth,” Troy said. “If you’re living independently in a private rental trying to save for a deposit, forget about it. It’s depressing, but people need to wake up to this.”

Some parents are also buying property for their younger children, particularly where the property is close to transport, universities and other tertiary institutions. Recently, a mother from Canberra purchased three apartments in Cramer listings in Wicks Place, Marrickville for her very young children who will one day move to Sydney for university. Popular urban locations where there is also a great youth culture and plenty of infrastructure are most attractive to such parents.

Cramer Property have a selection of outstanding apartments in Marrickville, Zetland and Rosebery. These brand new, architecturally superb properties are located close to tertiary education, transport and amenities. So, if you are in a position to help your child get on the property ladder reach out to the Cramer team today.

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