Do you worry about your kids’ future, and this crazy world in which we live? What can you do?
REASONS WHY PARENTS SHOULD BUY A HOUSE FOR THEIR KIDS
A way to distribute the inheritance while you are alive to see it.
Senior care – You might need them to take care of you some day!
Affordability – If prices stay strong, buying a house could get out of reach for most. A salary of $100,000 can barely buy a $600,000 house with 20% down today – and you have to go to an outlying area to find a decent house for that money.
Appreciation – Even if price didn’t go up much, paying down the mortgage builds equity.
Rental income – Pay cash or low-leverage a house purchase and hand over to a property manager. The resulting positive cash flow will help pay their expenses while searching for a high-paying job.
Help to establish an investment portfolio, and to diversify their holdings.
Create a cap on kids’ housing expense.
Safety Net for emergencies – Ill-liquid, but that ensures it’s only used for catastrophic events.
Help the kids grow up. Owning real estate is for adults, and it inflicts responsibility.
Relieve pressure on kids from having to marry rich.
Help determine where the grandkids grow up.
Ensures they live in a quality area with good schools.
Taking care of the kids and grandkids makes grandma happy.
If Grandma ain’t happy, then nobody’s happy!
I am going to send this to my newly retired parents, they will get a laugh.
Pretty sad state of affairs, when the economic conditions and outlook are so poor that the youth today can’t even get started w/o generational assistance.
And all the current real estate owners banking on endless appreciation? Good luck.
This isn’t grandpa’s America….and maybe not Pa’s either!
Run this by grandpa and see what he thinks of this country now – free cheese to 2020:
http://www.latimes.com/business/la-fi-california-funding-20160219-story.html
Money for Nothin’. Every day I do wake up and kick myself for shelling out 2k+ a month for rent. Why not put 5% down and just hope for the best? The government basically provides a free put option on houses again – prices plummet?
Just stop making the payments and live rent free.. almost feel stupid not doing it!
*Grin* And how about turning it around that the kids pay at least the down payment on a parent’s house? My son’s doing VERY well in tech… 🙂
I made the down payments for my 3 kid’s houses in 2010 – 2011 and am very glad I did. My in-laws loaned us half the DP for our first house back in the day, and it was a great gesture that helped us tremendously. When you get to where you’re going, you gotta turn around and help out. That’s how it works.
What are you telling your children if you make their down payments for them? You are telling them they cannot do it themselves.
They can. And when they do they will feel amazing that they have accomplished something on their own. And from there who knows what great thing they will accomplish. Without you as a crutch.
Let them show you.
Grandmas see it differently?
What happened to condos and starter homes then moving up with equity and savings?