Homes are increasingly unaffordable. Some homebuyers have a secret weapon.

[Yo_Mama_Been_Loggin]

The age-old "House Hunters" joke is a simple one: A husband and wife each have a ludicrous career and an equally ludicrous budget to buy their dream home.

For example: One spouse tunes harmonicas part time, the other trains hamsters — but, somehow, their home-buying budget is $1.2 million. Fans of the HGTV show have for years been puzzled by the number of participants who can afford a big budget while working jobs that seemingly lack big salaries.

Redfin has one potential explanation: family money.

About 38% of recent homebuyers under 30 years old used either a cash gift from a family or an inheritance to afford their down payment, according to a Redfin Corp. (Nasdaq: RDFN) survey of people who bought a home this spring.

https://www.bizjournals.com/seattle/news/2023/10/19/housing-market-home-buying-nepotism-redfin.html

[LiberalFighter]

1. So they reduce life expectancy of their parents?

[PortTack]

2. With jobs like that, Unless that inheritance was huge...just no never!

[Yo_Mama_Been_Loggin]

5. What's wrong?

Most people can't afford to buy a home. We need to establish policies that make homes more affordable instead of tax policies that favor the wealthy such as low capital gains and inheritance taxes.

[redqueen]

4. "cash gift from a family or an inheritance"

Keeping the status quo alive and well as much as possible.

[Fiendish Thingy]

6. The Bank of Mom & Dad is a very common source for down payments

Especially here in Canada.

How many boomer parents are gutting their retirement funds just so their kids can buy an overpriced house?

If parents stopped giving kids money to buy homes, prices would have to come down or the market would freeze.

(Inheritance is another situation altogether- typically when an adult child inherits their parent’s estate, they are much older than when seeking to buy their first home)

[Midnight Writer]

8. Is that different than the past?

My parents got their down payment for a house from an inheritance in the 1950s, despite both of them working full time into their forties.

Family or legacy wealth is always a big contributor to a person's future prospects. If you are born poor, it is tough to dig out of it, and one mistake can sink you. If you are born wealthy, you generally benefit from better education, better career prospects through family connections, and you can likely recover from mistakes with family support.

[Happy Hoosier]

9. Creating and leveraging generational wealth

is the key.

That can be hard.... getting that first house, building equity, and maintaining the equity to pass on to heirs can be hard.

I don't expect I'll be able to ensure my daughter is "trust fund baby," But I do hope that her Mom and I can can ensure she has the resources to buy a house of her own some day.