From this week’s Surreal Estate column on SFGate,

…if people are still buying, where is the money coming from?

There are two primary answers to this question. Both say something about how much we as a nation are banking our future on the promise of financial security in homeownership. Both say something about the risks many of us are taking to become part of that “ownership society.”

The first answer is good ol’ Ma and Pa, or as one Money Magazine article put it, “The National Bank of Mom and Dad.” According to the National Association of Realtors, last year 37 percent of first-time homebuyers reported that they had paid for their down payments in part or in whole with a gift, loan or inheritance from a family member or friend. (In 1991 only 18 percent of first-time buyers reportedly received monetary gifts from family or friends for down payments.)

In areas where prices are especially high, I wouldn’t be surprised if the percentages were higher. For the vast majority of the people I know who have bought a home in the Bay Area some time in the past five years, financial help from family has been an essential ingredient. Instead of waiting until they die, many older parents are helping their kids buy housing now. [more...]

How our houses are financing our lives [SFHomeBlog]

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