"Jean Frohling always wanted to help her three children buy places of their own. She and her husband, now in their mid-60s, saved for years in hopes of one day pulling their kids onto the property ladder. Eventually, hard work and foresight paid off: They gifted each of their first two children thousands of dollarsto pad the down payments on their first homes."
"Then, about a year ago, their youngest daughter found a house she liked just outside Peoria, Illinois. The Frohlings figured their then 33-year-old daughter could probably afford the house on her own, but they decided to leave even less to chance this time. They wanted to make sure their daughter avoided a mortgage hiccup or, worse, losing out to a stronger offer. Frohling and her husband opted to buy the home outright, paying $186,000 in cash."
"Nepotism is a hot topic these days: So-called "nepo babies" seem to be everywhere, riding the coattails of their rich and famous parents to land starring roles in movies, record Billboard hits, and wield power in Washington. The housing market isn't Hollywood, but as long as families have had a few dollars to pass down from one generation to the next, youngsters have relied on help from parents to get their foot in the door."
Jean Frohling and her husband saved to help their children buy homes, gifting thousands to two children and later buying their youngest daughter's house outright for $186,000 in cash to strengthen her offer and reduce mortgage risk. Nepotism has surfaced in housing as families with resources aid younger generations. About 30% of first-time homebuyers annually used a gift or loan from family or friends over the past three decades, while family assistance occurred for roughly 16% of all buyers. High home prices and steep borrowing rates increase demand for such help, and many baby boomers hold substantial equity and investment portfolios that could be tapped to assist offspring.
Read at Business Insider
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