Dublin-based mortgage advisors REA revealed yesterday that parents are providing between €15,000 and €20,000 to help towards the costs of their children's first homes.
REA said between 60% and 70% of first-time buyers rely on help from their parents to make an initial deposit, which is often as high as €30,000, on a house.
"A good percentage get parental assistance for a deposit or stamp duty, with €15-20,000 the reasonable average," said Sarah Wellbrand of REA. "People are stretching themselves to the max," she said.
The Economic and Social Research Institute (ESRI) says more information is needed to monitor the growing financial burdens being placed upon parents and children.
"Because people are releasing equity from their homes and putting it back into the housing market, it does mean the economy is particularly exposed to the housing market," said ESRI economist David Duffy.
The national average cost of a new home is now €241,692, €30,000 more than it cost in 2003, according to the Permanent TSB/ESRI house index.
Mortgage lenders pay scant attention to whether or not parents have indebted themselves once they sign a "gift letter" to say the money was a gift, not a loan.
The only indication of any burden comes from a "stress-test" first-time buyers complete to see how they would cope should interest rates rise.
"It's a method people have developed to access the housing market and financial institutions are responding to that," Mr Duffy said. "But when there's a number of children, how do they approach it then?"
Last year, the EBS Building Society drew criticism for a marketing campaign linked to its Family First scheme, but such equity-release products are proving popular. One month after the EBS scheme began, 3,700 customers had inquired about it.
The Central Bank has confirmed that studies are underway to examine more closely the trends in the Irish mortgage sector.
Meanwhile, stage payments for people buying houses has been described as an "anti-consumer practice which only benefits the construction sector," by Fine Gael spokesman Phil Hogan.
A Fine Gael bill designed to outlaw the practice of developers in housing estates demanding stage payments from homebuyers was voted down by the Government last week.
"The practice of paying for new homes by stage payments is common in Cork, Kerry, Limerick, Galway, Mayo and Sligo and has resulted in some homeowners paying an extra €7,000 for the price of their new home," FG Senator Paul Coghlan said.
However, the Irish Home Builders Association (IHBA) has defended the use of stage payments.
There is a code of practice designed to protect the interests of purchasers to which IHBA members must adhere. IHBA director Hubert Fitzpatrick warned housebuyers to ensure their building company was a member.
"In the past, stage payments themselves have not been a problem, it is the abuse of stage payments that have caused difficulties for purchasers," he said.