How do Kiwis view buying a home with parent’s help?

More than half of Kiwi parents say they would loan their children money interest-free to help them buy a home.

That is the finding of the latest research by Westpac NZ. It found 55% of parents would be prepared to gift their children money, 21% would offer them an interest payable loan and 18% are likely to buy them a property outright. The survey also suggest 53% would likely act as a guarantor on their children’s first home, but 45% of first home buyers say they would refuse that offer, compared to 35% who would accept it. The remaining 20% were uncertain.

“With house prices very high now in many parts of New Zealand, we wanted to understand attitudes to parents supporting their children into a home,” Westpac NZ acting general manager consumer banking and wealth Gina Dellabarca said. “The survey numbers show a strong degree of willingness to help, but also a range of differing attitudes and levels of knowledge.”

Asked whether first home buyers would accept their parents’ charity, the results were split. The survey revealed 64% of first home buyers would

feel bad about having to ask their parents for help, more than half admitting they’d feel less independent and 38% worried there’d be strings attached if they asked for help.

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Despite more than half of parents saying they’re either quite likely or very likely to provide an interest-free loan to their children, only 38% think they would be repaid in full.

“Most parents seem resigned to the fact that supporting their children in the current market will leave them out of pocket, but it’s a sacrifice they’re prepared to make,” Dellabarca said.

Other practical means of assistance were also popular with parents, with 63% saying they’d likely help out with childcare to help their children save for a home. 43% would let them temporarily move in with them rent free.

However, the survey found that most first home buyers don’t think their parents are duty-bound to help them onto the property ladder, despite their own relatively easier path to home ownership. Only 23% say the older generation should help out if they’re in a position to, while 35% disagree.