There is an increasing amount of young first home buyers recieving financial support from their parents to get into the property market.
This emerging trend shows that fractional property investment is quickly becoming a practical strategy for investors and related SMSfs.
Our very own Warren Gibson (Head of Marketing at DomaCom) said that recent Digital Finance Analytics had revealed that 60 per cent of first-time home buyers get financial help from their parents.
This is most often in the form of cash (gifted or loaned) or as guarantor on a home loan.
“Going guarantor means the parent/s use the equity in their home as security for part or all the deposit, enabling the child to get into a home with little or no deposit of their own and eliminating Lenders Mortgage Insurance,” he said.
“For those without the benefit of a bank of mum and dad (BOMAD) to call on, it is still possible to achieve home ownership by engaging a broader base than just mum and dad. Family members, friends and even random strangers can participate in funding residential property as an investment.”
The notion of sharing the costs of a property for the benefit of several different people is not new. This idea dates back centuries in order to make gaining an asset more affordable for everyone involved, according to Mr Gibson….Article Continues