Australians struggling with ridiculously high house prices are coming up with creative ways to make the most of a market that shows no signs of slowing down.
Arianne Endrizzi, 35, a married mother of two young children, bought an investment property in Redland Bay, southeast of Brisbane, with her 70-year-old mother Susan Putnam in June 2022.
“It was a response to a problem,” she told Daily Mail Australia.
“It was more about the question, ‘Can we help each other?’ and ‘How can we support each other and achieve our goals?’
Ms Putnam was left without access to her full pension after selling a two-bedroom apartment in Hornsby, in Sydney’s north, for $730,000.
The family home, or a person’s principal residence, is exempt from the assets test for people receiving a pension. But because she had money in the bank, Mrs Putnam could only receive a partial pension.
To get around this, mother and daughter paid a combined $195,500 each for a $391,000 plot of land in Redland Bay. The transfer tax on the plot was lower than on a house and land package.
Together, they spent another $285,970 building a four-bedroom, two-bathroom home.
Arianne Endrizzi, 35, a married mother of two young children, bought an investment property in Redland Bay, southeast of Brisbane, in June 2022 with her mother Susan Putnam, 70 (they are pictured with baby Aurora)
They split the total cost of $676,970 in two, with Mrs Putnam investing $338,500 in the Redland Bay property and the rest of her savings in a home on the Atherton Tablelands in north Queensland. That way, she would have money in both an investment property and a primary residence.
Ms Endrizzi, who grew up in Sydney, borrowed $180,000 to buy the land and house in Redland Bay and used her savings to finance the rest. The property is now on the market with a weekly rent of $725.
Property investing is now Ms Endrizzi’s full-time job. The mother of two lives in a house in Palm Cove, north of Cairns.
She also has investment properties at Red Cliffs near Mildura in north-west Victoria, another at nearby Nangiloc, a home at Burpengary north of Brisbane and Yarrabilba south of Brisbane.
“Be creative in how you raise money. The rise of financial content on platforms like podcasts, social media, YouTube and books provides valuable information that can give people ideas,” she said.
Mother and daughter split the total cost of $676,970 to build the house in Redland Bay, southeast of Brisbane, in half
Mrs Endrizzi borrowed $180,000 towards the cost of the land and house in Redland Bay and used her savings to finance the remainder
The average house price in Australia is $793,883. This is unaffordable for an average full-time worker with an income of $98,218.
That’s because banks are not allowed to lend more than 5.2 times a person’s salary, which means the average worker can only borrow a house worth $600,000, even if they put down 20 percent of their salary.
The average house price in every capital city except Darwin is now unaffordable for a single person on an average income unless they can buy a home with a partner, family member or friend.
According to Shane Oliver, chief economist at AMP, baby boomers now typically help their children buy a home so they don’t have to wait until their children are dead to receive an inheritance.
“Baby boomers and some of Gen X are benefiting from the prices. They are in a position in terms of their wealth where they can give their children some money now, rather than waiting to inherit it,” he said.
James Kirkland, general manager of sales at Little Real Estate, said he had never seen so many buyers flock to the ‘Bank of Mum and Dad’ in his 20 years in the industry.