The "Bank of Mom and Dad" is officially open for business in San Francisco, and it's making headlines as parents invest in SF real estate for their kids. Our own Danielle Lazier was recently quoted in The New York Times (gift article link) as an expert on this trend.
As housing affordability challenges continue to affect millennial and Gen Z buyers, more parents are stepping in to help their adult children achieve homeownership in the competitive SF Bay Area real estate market.
San Francisco's housing market operates in its own universe. Even with solid tech salaries, many young professionals find themselves priced out without significant financial help. As Danielle told The New York Times, "We have a phenomenon here in San Francisco where the two primary forms of a first-time buyer's down payment are either tech stock options or the Bank of Mom and Dad, sometimes a bit of both".
Nearly a quarter of first-time homeowners used a gift or loan from family or friends to help cover the down payment.
The numbers back this up. First-time homeowners made up only 24% of the market in 2024, down eight percentage points from the previous year, according to the National Association of Realtors. Nearly a quarter of first-time homeowners used a gift or loan from family or friends to help cover the down payment.
This isn't just about helping kids get a roof over their heads. Parents who bought real estate in San Francisco (or other high-priced cities like LA or NYC) decades ago have built substantial equity as property values climbed. Instead of waiting to pass on wealth through inheritance, many are making strategic transfers now, when their children need and can benefit from it most.
Those benefits go beyond financial security. Real estate in sought-after San Francisco neighborhoods has historically appreciated over the long term, making it solid for building intergenerational wealth, especially considering the high cost of renting in SF which doesn’t gain any equity over time. Owning a home in San Francisco also gives adult children stability to hit major life milestones sooner, from starting families to building careers.
Parents are taking different approaches to buy a home in San Francisco for their kids, depending on their situation.
While helping adult children invest in real estate can be transformative, it takes careful planning. Tax implications, gift tax exclusions, and legal protections should all be discussed with qualified professionals. Estate planning strategies like trusts can help maximize wealth transfer benefits while minimizing tax burdens.
Family dynamics matter too. Clear communication and written agreements help everyone understand the terms and responsibilities, protecting both the financial investment and family relationships.
Dive deeper into this topic in our related post, Investing in Real Estate for Your Adult Children in San Francisco.
We're honored that The New York Times turned to Danielle for her expertise on this important trend. The article, "They Cashed In. Now, They're Helping Their Kids," explores how parents with decades of equity are helping their children navigate today's challenging and increasingly expensive real estate market.
This recognition reflects our team's understanding of the San Francisco real estate market and our commitment to helping families navigate the complexities of buying and selling homes here. As top SF Realtors since 2002, we've guided many families through investing in real estate for adult children. We’d love to help you too!
If you're considering helping your adult children buy a home in San Francisco, or exploring ways to leverage your home equity for family wealth building, we are happy to assist you. Learn more about Danielle Lazier & Vivre Real Estate and sign up for our newsletter to keep in touch with regular updates on San Francisco real estate market insights, articles, and trends. (No spam or games.)
Ready to make a real estate plan for your family? Let’s schedule a quick consultation to discuss your personal situation and goals and see if we’re a good fit to help. Click here to contact us. We look forward to hearing from you!
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