Parents helping housebuyers ‘since Adam a boy’
Mortgage brokers across Ireland suggest majority of first time buyers are getting parental help
Homebuyers ‘across the board’ are getting parental help, according to one mortgage broker. Photograph: iStock
A majority of first-time buyers are getting parental help to secure a deposit for a home, mortgage brokers across the Republic have told The Irish Times.
On Tuesday, Taoiseach Leo Varadkar said lots of people have got help from their parents to raise a deposit, be it through a financial gift or staying at home in order to save.
However, mortgage brokers across Ireland have noted that a majority of new buyers get parental help and that this isn’t a new phenomenon.
“It’s been happening since Adam was a boy,” said Damien Long of Independent Financial and Mortgage Brokers on Cork’s South Mall. Mr Long said that while it’s not an endemic issue, he believes “there’s a little bit of pressure on the parents”.
Mr Long suggested that between one third and one half of new buyers were gathering a deposit with the help of parents, while Dublin brokers suggested it was at least half of new buyers.
Stephen Hamilton of Mortgage Line in Drumcondra estimated the figure could be as high as 60 to 70 per cent of first time buyers. “To be honest, it is the case in the majority of mortgage applications we have.
“Most people are renting and finding it difficult to save for a deposit,” he said. Mr Hamilton noted that in some cases, parents are letting their children live at home for a few years in order to save for a deposit.
Killian Sullivan, of Finance Solutions in Lucan, suggested that in the majority of cases, parental help is used to make up the shortfall of a deposit. However, he noted the issue isn’t confined to first time buyers. “It’s across the board. It’s first time buyers, people trading up - it’s a mixture,” he said.
While gifts from parents to Dublin buyers may come in the form of help with a deposit, Brian Melia of Mortgage Options in Galway said in his experience families gift a site to their children in a lot of cases.
“There’s always some element of parental gifting,” Mr Melia said. Asked whether this was a worrying development, he added that gifting was “always the way”. What is worrying, however, is the fact that the cost of construction has increased, so prospective homeowners are getting less for their money, according to Mr Melia.