Today’s homebuyers are receiving more than a little help from their families in their pursuit of the American Dream of homeownership.
A new survey of 2,000 adults by LendingTree (NASDASQ:TREE) found nearly two in five homeowners (39%) have received down payment assistance – with 78% of Gen Z homeowners reporting some financial support for a down payment, mostly from their parents. The survey also found 54% of millennials have received down payment help, followed by 33% of Gen Xers.
“In today’s housing market where — even if you can get approved for a loan — buying can still be prohibitively expensive, the more help you have with things like a down payment, the easier buying can be,” said LendingTree Senior Economist Jacob Channel. “Ultimately, even though that figure is high (probably higher than many people would expect), it speaks to how expensive and tough to navigate today’s housing market can be.”
Separately, a Realtor.com-Censuswide survey of 2,291 Americans planning to buy a home within the next 12 months found roughly half of the respondents (51%) were potentially looking to their parents to help them prepare for buying a home, with nearly one third (29%) saying they have already moved in with their parents to help save money in preparation for buying a home and another quarter (22%) saying they would consider doing so.
Also, one third (32%) of respondents said they were even cohabitating with other family members to help save enough money to buy a home – including siblings, aunts and uncles, and cousins, with another 24% stating they would consider going this route.
“The challenging market conditions this year are changing buyer behavior in significant ways, driving many more people to explore alternative living situations they may not have considered in the past,” said Danielle Hale, chief economist at Realtor.com. “Mortgage rates hovering at or near 7% have eroded buyers’ purchasing power at a time when the consistently low number of homes for sale has kept housing markets surprisingly competitive.”
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