How parents are helping millennials
to buy homes earlier and build wealth
With the high cost of housing in some areas, it’s not surprising that people are looking at creative ways to solve for affordability. Achieving the dream of home ownership is especially challenging for aspiring buyers under 35, who may be struggling to save for a down payment while financially burdened with ever-increasing rent and student debt.
According to a Zillow estimate, 21% of millennials in the US currently live at home with their parents. It’s becoming more common for this generation to leave the nest later in life in comparison to previous generations. This is a significant jump from the 11.7% living at home 12 years ago.
We can understand the higher statistic due to the increase in housing prices, rent, student debt and overall affordability. Millennials today live in a much more varied range of household types such as: living with roommates, an unmarried partner and as we’re seeing, moving back in with their parents.
Helping family members buy a home earlier than they might on their own can be a smart long-term strategy. An analysis of Panel Study of Income Dynamics (PSID) by Urban Institute suggests that buying a home earlier in life is key to building housing wealth:
“Those who bought their first home between ages 25 and 34 have the greatest housing wealth by their sixties.”
“Those who bought their houses later have significantly lower housing wealth. Ten years of appreciation alone can make a big difference.”
If you are thinking of buying a home, give me a call. I am happy to discuss current Napa Valley market conditions and how the current picture affects your personal situation.
Published on 2019-10-23 06:02:15
