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Getting a Helping Hand: Parental Transfers and First-Time Homebuyers

Author

Listed:
  • Maurice J. Roche

    (Economics Department, National University of Ireland, Maynooth)

  • David Duffy

    (Economic and Social Research Institute, Dublin, Ireland.)

Abstract

A model that allows for inter vivos intergenerational transfers in a booming housing market is developed. The model is used to explain how transfers effect the first-time homebuyer’s consumption and housing decisions by alleviating borrowing constraints. The general implications of the model are tested using data from the leading Irish mortgage provider. We find that private transfers are targeted towards homebuyers that are liquidity constrained.

Suggested Citation

  • Maurice J. Roche & David Duffy, 2007. "Getting a Helping Hand: Parental Transfers and First-Time Homebuyers," Economics Department Working Paper Series n1740507, Department of Economics, National University of Ireland - Maynooth.
    • Handle: RePEc:may:mayecw:n1740507
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    File URL: http://repec.maynoothuniversity.ie/mayecw-files/N1740507.pdf
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    References listed on IDEAS

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    1. Cox, Donald & Jappelli, Tullio, 1990. "Credit Rationing and Private Transfers: Evidence from Survey Data," The Review of Economics and Statistics, MIT Press, vol. 72(3), pages 445-454, August.
    2. Guiso, Luigi & Jappelli, Tullio, 2002. "Private Transfers, Borrowing Constraints and the Timing of Homeownership," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 34(2), pages 315-339, May.
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    8. Duffy, David & FitzGerald, John & Kennedy, Kieran A. & Smyth, Diarmaid, 2000. "Quarterly Economic Commentary, March 2000," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC20001, June.
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    Cited by:

    1. Yukutake, Norifumi & Iwata, Shinichiro & Idee, Takako, 2015. "Strategic interaction between inter vivos gifts and housing acquisition," Journal of the Japanese and International Economies, Elsevier, vol. 35(C), pages 62-77.

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    More about this item

    Keywords

    Transfers; Housing; Borrowing Constraint;
    All these keywords.

    JEL classification:

    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

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