‘Bank of mom and pop’ backing home buys
December 18, 2020
More parents are helping their children buy a home this year, despite financial woes during the pandemic.
A recent RBC Home Buying Sentiment Poll found that while over 75 per cent of respondents are concerned about the financial impacts of COVID-19, 31 per cent are willing to help their child or an immediate family member pay for a new home.
Almost 50 per cent are also willing to help their child or family member with rent if asked.
In fact, 25 per cent of Canadians polled stated they providing more financial support to their family as a result of the pandemic.
Canadians that were willing to provide financial assistance were willing to give their child an average of $60,513 to support a home purchase, with only 46 per cent expecting to be paid back.
“As more of us continue to work and spend time at home, many Canadians want to continue on their path to homeownership,” said Amit Sahasrabudhe, RBC vice-president, Home Equity Finance, Products and Acquisitions. “Even during these uncertain times, what we are seeing is that families are continuing to rally around each other and financially support their loved ones as they work towards buying a home.”
The poll also found 66 per cent of Canadians are concerned about how the next generation, and their children, would be able to afford a home, with over 50 per cent thinking affordability will only worsen in the near future.
Despite this, 81 per cent still believe homeownership is a good investment while 29 per cent agree it makes more sense to rent than buy right now.
“Canadians have a lot more to consider when buying a home than they did a year ago, but they don’t have to do it alone,” according to Sahasrabudhe.