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Passing Along Housing Wealth from Parents to Children

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Young adults are more likely to own a home if their parents are homeowners than if their parents are renters. New research reveals how parents owning a home can lead to an increase in the persistence in homeownership across generations. Specifically, homeowner parents are often able to extract the equity value from their home to help their children purchase a home. This “dynastic” home equity enables children of homeowner parents who extract equity to accumulate approximately one third more housing wealth by age 30 than children of renters.

Suggested Citation

  • Matteo Benetton & Marianna Kudlyak & Louis Liu & John Mondragon & Mitchell Ochse, 2022. "Passing Along Housing Wealth from Parents to Children," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, vol. 2022(32), pages 1-6, November.
    • Handle: RePEc:fip:fedfel:95166
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    File URL: https://www.frbsf.org/economic-research/publications/economic-letter/2022/november/passing-along-housing-wealth-from-parents-to-children/
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