Compared to generations before them, it has been speculated that Baby Boomers are some of the most generous parents in modern American history, especially when it comes to supporting their adult children’s housing needs. A recent Pew Research Center study found 32% of adults 18-34 are living in their parents’ home, more than there are Millennials living with a partner or spouse, or living alone.
However, according to findings from the latest ValueInsured Modern Homebuyer Survey, Baby Boomers will likely be outdone by Gen-Xers and Millennials when it comes to parental generosity. More Americans increasingly agree than disagree that parents should help their adult children purchase a home.
According to our survey results obtained in Spring 2016, 56% of all Americans believe it is a natural and acceptable responsibility for parents to help their adult children financially with buying a home. It is not surprising homeowners are particularly receptive to the concept. 73% of all surveyed homeowners said they have helped or will be open to helping their children financially with buying a home.
Looking at future generations of parents, among all Gen Xers surveyed – including homeowners and renters – 62% said they would be willing to help with their children’s home purchase once they reach adulthood. That figure is even higher for Millenials. Perhaps to reciprocate their own Boomer parents’ generosity and to pay it forward, 67% – that’s nearly 7 out of 10 – of Millennials surveyed said they would be willing to help their children one day financially with a home purchase. This figure is particularly stunning considering that is higher than the rate of Millennials who actually have children.
Helping adult children purchase their first home has long been a tradition in other cultures. There is indication that the next generation of parents in America will increasingly adopt the practice. Such findings have meaningful implications on home financing, and also on marketing to homebuyers and home loan borrowers. Sellers, brokers, and loan officers should keep in mind that they will increasingly need to cater to a multi-generational buyer audience when selling a home or home financing.