Home prices have nearly doubled in ten years, according to data from the US Bureau of Labor Statistics. For many young buyers, owning a home isn’t just intimidating—it feels impossible.
But the numbers don’t lie. Between 2020 and early 2024, prices jumped more than 47 percent according to a 2024 analysis by ResiClub of the Case-Shiller National Home Price Index, driven by low interest rates and limited inventory. By the end of 2024, the median sales price for an existing home in the U.S. hit $407,600.
Affordability has shifted. And that’s exactly why more families are stepping in.
Redfin reports that in 2023, 38 percent of buyers under 30 used a cash gift or inheritance to fund their down payment. In 2024, 36 percent of Gen Z and millennial buyers said they expect financial help from family.
In a previous post, we discussed how real estate investing offers a unique opportunity to leverage your time, credit, and energy to build wealth. It’s true: You don’t need significant capital to get started, but access to a gift from a family member can turbocharge your purchasing power.
But writing a check isn’t the complete strategy. Intentionally structuring that support can protect your capital and teach financial responsibility while giving your child a meaningful head start.
Here are the most effective ways we see parents are helping:
- Gifting money for a down payment. This lowers the loan amount, can remove PMI, and creates more favorable loan terms. Currently, individuals can gift up to $19,000 per child, or $38,000 as a couple, without triggering federal gift tax.
- Co-signing the mortgage. This is helpful if your child has a low income or a limited credit history. But it comes with shared liability. If they miss a payment, your credit is at risk.
- Loaning money. A private loan gives flexibility, but it must be properly documented.
Set clear terms, interest, and repayment structure to avoid tax issues and personal friction.
- Buying the home, then renting or selling to your child. You keep ownership and control early on, with flexibility to transition later. But it is important to know the tax and legal implications, especially around first-time homebuyer benefits.
If your child is serious about buying, and you’re in a position to help, treat it like an investment. With a well-structured approach, you can give them a real start and create something that benefits you both.
If you want to discuss how this fits into your broader investment strategy, I’m here to help.