Real estate agent reveals the unlikely buyers driving up house prices – and it’s not cashed-up downsizers

Forget spiralling interest rates, real estate agents in the country’s most overheated markets blame ‘the bank of mum and dad’ for sending property prices soaring. 

Sydney realtor Amir Jahan said rich parents had become all too willing to overpay to help their adult children buy their first dream home.

‘They are emotional buyers. Young people who have help from rich parents will say, “I love this property,” and their parents will help them get it,’ he told news.com.au.

The 28-year-old agent insisted it was ‘100 per cent’ emotional buyers backed by ‘boomer’ money that was pushing up property values.

He said prosperous parents would often outlay $1.5million for a home otherwise worth just $1.3million because their children had ‘fallen in love with the property’ – and blamed them for dragging up prices for everyone. 

Mr Jahan said property values in the Sydney market had also been so overheated for so long, many buyers were no longer shocked by the inflated prices.

‘It has become normal,’ he told the website. ‘Four years ago, in Parramatta, when we told people a two-bedroom unit was selling for $500,000, people would freak out.

‘Now we tell them that same apartment is $650,000, and they are surprised it isn’t more.’

Mr Jahan says ’emotional’ young buyers convince their parents to overpay for their dream home

Mr Jahan’s take on surging house prices comes after young buyers spoke to Daily Mail Australia about their experience trying to get onto the property ladder.

They said first-time buyers being helped out by their parents weren’t causing over-inflated prices; instead, they blamed downsizers for aggressively over-bidding for the small houses and units once considered starter properties for young Aussies.

Mr Jahan’s warning comes amid startling new data that revealed the national real estate market had hit record levels for unaffordability – and that the vast majority of homes across the country were simply unattainable for regular Australians. 

Proptrack’s latest report, released on Saturday, found it took an average of five years to save for a house deposit, and buyers with the country’s median-household income of $120,000 could only afford to buy one in 10 of the properties listed on the market. 

Leading real estate agent Mat Steinwede said the Instagram generation had become used to instant gratification – and having their parents pay for it. 

Unfortunately, he added, prices were now so high, it was the only way young first-home buyers could get into the property market before it soared ever further out of reach. 

Mr Steinwede said he had just helped his 25-year-old son buy a home because he knew it was too difficult to expect him to do it alone.

The vast majority of houses are now unattainable for the average Australian homebuyer

‘I’ve just helped him buy his first home. He wouldn’t have been able to do it alone, not with how much you need for a deposit plus stamp duty. It has become too difficult,’ he told news.com.au. 

However, he said it was important to ensure young adults had a stake in the financial burden of buying a house to teach them the importance of savvy investing.

He said his son was learning a critical financial lesson by being responsible for half of the repayments on his new home. 

‘Every time he makes a mortgage payment, it is the same as him putting $400 in the bank. He’ll waste his money otherwise,’ Mr Steinwede said.

‘He’ll look back and be glad he did it.’

‘It is a good lesson for him. If you buy a car, it goes down in value, and you’re paying interest and repayments, but if you buy a property in 10 years, it might double.’