<div><p><span>Articles, Reddit threads, and happy-hour banter over the years mocked the parent-provided down payment as the ultimate golden ticket in home buying — especially for first-time shoppers.</span></p><p><span>But at a time when<a href="https://www.boston.com/real-estate/real-estate-news/2023/10/26/long-term-mortgage-rate-rises-7th-straight-week/" target="_blank"> mortgage rates are at their highest level</a> in decades, housing experts say it’s more than the upper strata of wage earners relying on parental help these days to buy a home.</span></p><p><span>Thirty-nine percent of all homeowners have received some form of down payment assistance, according to the findings of a <a href="https://urldefense.com/v3/__https://www.lendingtree.com/home/mortgage/down-payment-help-survey/__;!!BspMT6SJLSDJ!L9fsNEmhJ5C6IfE93hJoCDf-rSxL6k3KOfRAvkbBwt6p-NuS3ulKct75nRKfcZU6Qk9DdxoLP4Z_a0KZ3kYZsQ$" target="_blank">LendingTree survey</a> of 1,950 US consumers comprising four generations — from baby boomers to Generation Z.  The help largely came from parents and other family members.</span></p><p><span>That number climbs in the younger demographics: Nearly 17 percent of baby boomers received help, but 33 percent of Gen-Xers, 54 percent of millennials, and 78 percent of Gen-Zers received some form of down payment assistance, especially from parents.</span></p><p><span>“In a nutshell, it really just boils down to the fact that things are expensive right now,â€ said <a href="https://press.lendingtree.com/about/our-experts/bio/jacobchannel" target="_blank">Jacob Channel</a>, a senior economist at LendingTree. “This is especially true for younger folks who haven’t had as much time to save up money for things like a down payment.â€</span></p><p><span>The 30-year fixed mortgage rate briefly surpassed 8 percent in late October, according to a <a href="https://www.mortgagenewsdaily.com/mortgage-rates/30-year-fixed" target="_blank">Mortgage News Daily</a> analysis. The lack of inventory and high mortgage rates have helped cool sales activity markedly in Greater Boston, yet prices are still climbing.</span></p><p><span>The $849,950 median single-family sales price in the region was a record for the month of September, as was the $680,550 median condo cost, according to the <a href="https://www.gbreb.com/GBREBDocs/GBAR/News/Housing-Market-Data/2023/Residential-Market-News-Release-Sept-2023.pdf" target="_blank">Greater Boston Association of Realtors</a>. Toss in a mortgage rate more than twice the level seen two years ago, and parental help and generational wealth become more of a necessity than just nice things to have during the home-buying process.</span></p><p><span>Homeowners making six-figure annual incomes as well as those earning $35,000 to $49,999 are most likely to receive financial support buying a home, according to the LendingTree survey.</span></p><p><h2 id="why_now">Why now?</h2></p><p><span>There are a variety of reasons why parents step in to help their children buy homes, those interviewed for this story said.</span></p><p><span>“I just had my first baby, and I was in this small condo that wasn’t going to work. And then my sister was renting in Quincy, and her rent was going up,â€ said Benjamin Roughan, whose father helped them buy a two-family home in Middleborough. “My father feels like he’s making a difference in our lives. He’s happy, and then we’ll eventually pay him back when either we refinance down the line or get some savings over the next couple years.</span></p><p><span>“He’s in no rush.â€</span></p><p><span><a href="https://www.coldwellbanker.com/ma/brookline/agents/nicholas-wise/aid-P00200000FZPWtaz4RVBndVBy0UpBEKnOTjuXL2l" target="_blank">Nicholas Wise</a>, a sales associate with Coldwell Banker Realty in Brookline, said he sees renters switching to buying “just because their parents or their grandparents are so against them renting.â€</span></p><p><span>Realtors are reporting a similar parental buy-in in Central Massachusetts, as high home prices push buyers north, south, and west of Boston. The $410,000 median sales price for a home in Worcester in September was still up 4.4 percent from a year ago, <a href="https://www.redfin.com/city/20420/MA/Worcester/housing-market" target="_blank">according to Redfin</a><a href="https://www.redfin.com/city/20420/MA/Worcester/housing-market" target="_blank"> data</a>.</span></p><p><span>“At this point, with everything being so expensive and salaries not rising as quickly as real estate prices, a lot of people are going to try and help their kids and give them a leg up,â€ said <a href="https://www.sellingwaltham.com/agents/brian-and-catherine-kiernan/" target="_blank">Catherine Kiernan</a>, a real estate consultant with Gelineau &amp; Associates Real Estate in Waltham.</span></p><p><h2 id="'make_sure_it's_a_gift'">‘Make sure it’s a gift’</h2></p><p><span>Experts caution that even those privileged enough that they can rely on the Bank of Relatives need to have a strategy. Be sure to present the parental help as a gift, not a loan, so the lender doesn’t think the buyer has to pay it back in a timely fashion on top of the monthly mortgage payments.</span></p><p><span>“Try to make sure it’s a gift because, if it is a loan, that’s going to be factored into things like your overall loan-to-value or your total debt-to-income ratio,â€ Channel, the LendingTree economist, said. “That could actually reduce your chances of getting approved for a loan.â€</span></p><p><span>But how do you pay it back without making things awkward at Thanksgiving? Those interviewed for this story all emphasized that communication is key.</span></p><p><span>Further, parents shouldn’t feel obligated to make a Herculean sacrifice and fork over a large sum of money to help their offspring with a home purchase, they said.</span></p><p><span>“It’s really nice to be able to help your kids, but if you’re a parent and your option to give your kid money for a down payment is to take out a second mortgage on your house or zero out your savings, it might not be the best idea,â€ Channel said. “Make sure everyone is on the same page.â€</span></p><p><span>There’s enough family guilt during the holidays without having to throw in unreasonable down payment expectations on top of the turkey and dressing.</span></p><p><span><i>Send comments to </i><a href="mailto:camsperance@gmail.com" target="_blank"><i>camsperance@gmail.com</i></a><i>. 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