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Published 03 July 2012 06:19, Updated 04 July 2012 06:57
More than 50 per cent of baby-boomer say they want to help their kids but less than 20 per cent expect to be able to.
Young Australians counting on their parents to help them out with property investments are rethinking their strategies given the stagnant state of the housing market.
While some members of Gen Ys have had help with buying property in recent years, a new survey shows that fewer young people now expect their baby-boomer parents to help them out with buying their first home than previously.
The latest RaboDirect National Savings and Debt Barometer shows that 64 per cent of Gen Y individuals don’t expect to need help from their parents, compared with 47 per cent last year.
The survey results come after the 2011 census found outright home ownership has declined and the proportion of people making mortgage repayments or paying rents has risen.
While members of Generation Y – individuals born between the closing years of the 1970s up to as late as the mid-2000s – are feeling more independent, their parents are in a rocky financial position and are not in a position to give them financial help.
Almost 53 per cent of baby-boomer parents surveyed for the RaboDirect study say they want to help their kids but just under 20 per cent expect to be able to.
Australians used to expect to retire with the family home paid off and worth much more than what it was bought for but RaboDirect spokeswoman Renee Amor says its findings contradict this.
The survey shows about 30 per cent of baby boomers expect to retire with a mortgage, while 41 per cent of those retiring with a mortgage expect to repay it only by selling their property.
Amor says that this is cause for concern, given that housing values are slipping and the population is ageing. But she says “it’s never too late to counter these trends” by saving.
“Even small steps and changes in budgeting, savings and spending behaviour can help build a bigger nest egg to maintain your lifestyle in retirement,” she says.