The Association Between Parents’ and Adult Children’s Homeownership: A Comparative Analysis

Abstract

We investigate the extent to which the intergenerational transmission of homeownership varies across European countries. Our main hypotheses are that the impact of parental homeownership on the likelihood and timing of an adult child’s entry into homeownership is less strong in contexts where homeownership is more accessible (in terms of affordability and access to mortgage credit), where renting is a feasible alternative to owning, and where the family matters less for the provision of welfare and housing. We perform discrete-time event history analyses of the transition to first-time homeownership using retrospective SHARELIFE-data from 10 European countries. Our respondents were born between 1908 and 1963, while observed entries to first-time homeownership occur between 1965 and 2009. We introduce fixed effects for countries and macro-level indicators for country-period combinations, interacted with parental homeownership. We find that the intergenerational transmission of homeownership is stronger in contexts where house prices are higher (and homeownership is less affordable), and less strong in more affluent contexts and in contexts where homeownership has increased more. The remaining differences in intergenerational transmission cannot be attributed to differences in welfare regimes or between dual and unitary rental markets.

Parental marital dissolution and the intergenerational transmission of homeownership

“…The underlying assumption here is that within-family differences can be generalized to different family types. In a comparative study for 10 European countries on homeownership entries between 1965and 2009, Mulder et al (2015 furthermore find that the intergenerational transmission of homeownership is stronger in contexts (country-period combinations) where homeownership is less affordable, but less strong in more affluent contexts. The higher the level of economic affluence, the greater the likelihood of a transition to homeownership, but the smaller the impact of parental homeownership.…”

“…Helderman & Mulder, 2007;Lersch & Luijkx, 2015;Mulder et al, 2015;Rowlands & Gurney, 2000): (1) direct parental assistance for housing promoted by the economic benefits associated with parental homeownership (e.g. lower housing costs in later life, housing equity (gains)), allowing parents to use accumulated (housing) wealth to enable children's homeownership through gifts, loans or mortgage guarantees; (2) intergenerational transmission of homeownership as a side-product of socio-economic status transmission; (3) geographical proximity between parents and children (indicating both a shared opportunity structure and a stronger likelihood of support exchange); (4) and socialization towards a preference for homeownership.…”

Intergenerational transmission of housing choice: The relevance of green spaces for moving into a family house across social class

“…Parental homeownership was found to accelerate young adults' entry into homeownership in various contexts (Bayrakdar et al, ; Coulter, ; Kurz, ; Lersch & Luijkx, ; Mulder, Dewilde, van Duijn, & Smits, ; Mulder & Wagner, ), whereas other parental characteristics like education (Mulder & Wagner, ), single parenthood or step‐parenthood, and number of siblings (Bayrakdar et al, ; Lersch & Luijkx, ) were barely influential. There is evidence that the parents of home buyers are involved in an increasing number of property transactions in European countries (Ronald & Lennartz, ) and that the influence of parental tenure on the transition into homeownership has increased (Coulter, ; Kurz, ), especially in expensive housing markets (Mulder et al, ).…”

Intergenerational Inequality? Labour, Capital, and Housing Through the Ages

“…Helderman and Mulder ). Mulder et al (:511) showed that parental homeownership has a positive effect on rates of homeownership among adult children in “most, but not all” of 10 continental European countries.…”