Key Details:
- A recent survey from Realtor.com and Censuswide shows one-third of prospective homebuyers are moving in with relatives to help save for a home purchase.
- More buyers are also choosing to live with or near family, with the majority of those doing so to share the cost and responsibilities of childcare.
A survey from Realtor.com and Censuswide is shedding light on the growing number of prospective homebuyers moving in with relatives to cut costs and save for a home.
In fact, one-third of hopeful buyers have already moved in with parents or other family members, some because of recent return-to-office requirements and many due to high childcare costs.
Today’s buyers are experiencing the most unaffordable housing market ever recorded. So, it’s no wonder more of them have decided to turn relatives into co-buyers and/or roommates to share the cost of a home purchase.
Roughly half (51%) of those surveyed who plan to buy a home within the next 12 months are potentially looking to their parents for assistance in preparing to buy a home. Almost a third (29%) say they’ve already moved in with their parents to help save toward a home purchase, and another 22% say they would consider doing the same.
About a third (32%) are cohabitating with other relatives—including siblings, cousins, aunts, or uncles—to save money, while another 24% said they would consider doing so.
The challenging market conditions this year are changing buyer behavior in significant ways, driving many more people to explore alternative living situations they may not have considered in the past. Mortgage rates hovering at or near 7% have eroded buyers’ purchasing power at a time when the consistently low number of homes for sale has kept housing markets surprisingly competitive.
Living with relatives to share childcare costs and responsibilities
Many potential buyers are also planning to live close to family even after they’ve saved enough for a home purchase. Twenty-eight percent of survey respondents who plan to buy a home in the next 12 months are doing so to live closer to family.
Many of those buyers are motivated by the prospect of saving time and money by sharing the costs and responsibilities of childcare. Half (50%) are motivated by a desire to help care for other children in the family, while the next largest share (44%) need affordable help caring for their own children.
Other respondents cited a variety of reasons for living near family, including—
- Attraction or attachment to the area where their parents/family live
- Unaffordable cost of living in their current or former neighborhood
- Health issues
Many respondents already live near family; about four in ten say their parents, siblings, or extended family members have purchased a home nearby.
Co-buying and living with or near family for the long term
With housing affordability at an all-time low, co-buying and/or co-living with family have become more popular options for prospective homebuyers. Eighty-three percent of respondents said they would consider buying a home to live in together with someone other than their spouse/partner—including a friend or an extended family member.
Respondents were most open to co-buying a home with—
- One of their kids (37%)
- A romantic partner they’re not married or engaged to (31%)
- A sibling, cousin, or other relative from the same generation (27%)
- Their parents or in-laws (23%)
For those open to co-buying a home with someone other than their spouse/partner, their top reasons pointed to the following benefits of pooling their resources:
- A better location (43%)
- A more updated home (41%)
- A bigger home (38%)
A little over one-third (36%) said they would co-buy a home with someone other than a spouse because they’re already cohabitating and would like to start building equity as soon as possible. Twenty-nine percent would do so because they’re unable to buy a home on their own.
While home buyers have long received financial assistance from family members to help them afford a home purchase – especially first-time home buyers who may not have already built up equity – we’re seeing more and more prospective buyers take this a step further. Faced with ongoing housing affordability issues and rising childcare costs, we’re seeing parents and children becoming roommates again in later years as the ‘kids’ save up to purchase their own place, siblings moving near each other to pool childcare resources, and some even buying homes with family to split the financial burden and make homeownership a reality.
Takeaways for real estate agents
If any of your clients are planning to co-purchase a home with a family member, friend, or romantic partner, make sure you meet with everyone who will be responsible for the costs associated with the home purchase. Make sure they all know what they’re committing to, and encourage them to share their expectations and hopes regarding the home they purchase.
Buying a home is a huge undertaking—and one that isn’t easy to get out of once the deal is done. Ask if your clients are willing to discuss their fall-back plan if co-buying and/or cohabitating doesn’t work out for them. Just knowing and articulating that plan can help reduce some of the stress they’re likely to feel during the home buying process.
