If you own your own home, you’ve probably made a lot of money just by living there and seeing its value rise over time. It’s fair, right? It might make a difference in your child’s life.
Many first-time buyers are still having a hard time getting a home because prices are still too high for many people. People can feel like they can’t buy even if they have a stable job and a good plan. But that’s where your equity could really make a difference.
You can get an idea of how much equity the average homeowner with a mortgage has by looking at this number: $311,000. That’s important. Plus, some parents are giving their kids some of their equity to help them buy their own homes.
Bank of America says that 49% of buyers between the ages of 18 and 26 got money from their parents for the down payment.
It’s not clear from the data how many parents used their equity, but the wealth they’ve built up by owning a home may have made it possible, given how much equity the average homeowner has now.
This is a powerful legacy to leave behind, even though what’s right for each person will be different. It helps those younger people buy a home, build equity, and start the next part of their lives with a lot more stability and less stress about money. And what about those parents? They can use it to make what they’ve built into something very important.
It’s not just about money. For many people, it’s about giving their child the chance to say, “We got the house!” And giving them a head start they might have only dreamed of when they were that age. This is the part that really sticks out. What Compare the Market Says:
“Of those who did receive monetary aid from parents and grandparents to buy a house, 45% of Americans said they would not have been able to purchase a house without financial support from parents and grandparents.”
Bottom Line
Your children might not be able to buy their own homes on their own, but your equity could help them do it. Now, here’s the question.