The pressure on Chinese parents to help their Millennial-aged children buy a home is a jaw-dropper. The Chinese one-family policy plus the urbanization of the economy is creating a generation of Little Emperors that have high expectations for how much their parents will do for them in terms of housing. With housing tight in urban areas and unaffordable at the salaries the Little Emperors are earning, Chinese millennials are looking to their parents to help with the down payment on a house as well as a hefty assist with the mortgage payments.
It's a familiar story--at least the housing part of it.
In Australia, where there's a housing crunch too, a study of 2017 home purchases found that more than half--55 percent--of first-home buyers got a financial boost from their parents. It's quite a leap for the land down under. In 2010, only 3.3 percent of first-time buyers got help from mom and dad.
Here in the U.S., the pressure also starts at home. According to a recent analysis of census data by Zillow, in 2005 roughly 14 percent of millennials (ages 24 to 36) lived at home with mom and dad; today, it's nearly 23 percent. They're there for a variety of reasons but chief among them is the cost of housing in urban areas, which is outpacing wages.
Both millennials and their parents would like to see the youngsters move out and into a home of their own, and parents are helping make that happen. A 2018 survey by the National Association of Realtors found that, among homebuyers who made a down payment, 23 percent of those 37 and younger had the wherewithal of a gift and 6 percent a loan from family or friends — the highest proportion for either type of assistance among all age groups.
Feels like help with a down payment is becoming a universal language of love--or for parents who can afford it, a loving necessity.