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The latest Mortgage Choice Home Loan Report has revealed a “strong desire” for home ownership among Gen Z and Millennial respondents.
The survey, which gathered responses from 1,000 consumers nationally, found that half of borrowers surveyed said if given $100,000 they would use that money to buy their first property or put it towards purchasing an investment property.
According to the generational breakdown in the report, Gen Z were the most likely to put the funds towards purchasing their first property (37 per cent), followed by Millennials at 24 per cent. In terms of property investment, Millennials were more likely to use the funds for this purpose at 23 per cent, while Gen Z and Gen X tied at 17 per cent.
A quarter (25 per cent) of Gen X respondents said they’d put those funds towards their home loan, followed by Millennials at 23 per cent, Baby Boomers at 9 per cent and Gen Z at 7 per cent.
Baby Boomers were the most likely generation to use the funds for “other”, at 39 per cent.
Mortgage Choice CEO Anthony Waldron said: “It has been a year since the release of the first Mortgage Choice Home Loan Report and the market has changed significantly in that time. Inflation has reduced from its previous highs and home loan interest rates have started to fall.
“As property prices have reached new record highs, getting into the market has become harder, so we asked survey respondents how they were doing it. We found that more than a fifth of Gen Z respondents were funding their home loan deposit with a cash gift from family, making the bank of mum and dad one of the largest lenders in the country.
“Our research confirms what our brokers hear from customers every day – property isn’t just an asset class, young Australians see it as their path towards financial security for themselves and their families,” Waldron said.
Indeed, the report revealed that 22 per cent of Gen Z respondents were funding their deposits with a cash gift from their families, while 25 per cent were accessing the First Home Guarantee Scheme and 30 per cent were using the First Home Super Saver scheme.
However, 74 per cent of Gen Z respondents stated they would use their own savings to purchase a property, just behind Baby Boomers at 76 per cent, and followed by Millennials (70 per cent) and Gen X (69 per cent).
“Our survey supports what we hear from Mortgage Choice brokers, particularly those in Sydney where median home prices have climbed to over $1.1 million,” Waldron added.
“Our brokers tell us that many first home buyers can’t afford to buy in Sydney without a cash gift, and those gifts range in value from $10,000 to as much as $500,000.
“National home prices have risen nearly 50 per cent over the last five years. Home owners who’ve been steadily paying off their home loan and benefited from property price growth may have built up considerable amounts of equity that they can tap into to renovate, upgrade their home or purchase an investment property,” he said.
[RELATED: Gen Z faces greatest hurdles in property purchases]
