Young British Adults’ Homeownership Circumstances and the Role of Intergenerational Transfers

© [Suh, 2020]. Author's final submitted version. The definitive, peer reviewed and edited version of this article is published in Longitudinal and Life Course Studies, DOI: 10.1332175795920X15846933259695, and available at: https://www.ingentaconnect.com/content/bup/llcs/pre-prints/content-llcs

27 Pages Posted: 7 May 2019 Last revised: 21 Apr 2020

See all articles by Ellie Suh

Ellie Suh

University of Oxford; London School of Economics & Political Science (LSE); London School of Economics & Political Science (LSE) - Centre for Analysis of Social Exclusion (CASE)

Date Written: April 8, 2019

Abstract

Despite the continuing preference for homeownership, it has become increasingly difficult for young adults to own a home in Britain. House prices have increased faster than real earnings between mid-1990s and 2010s, resulting in significantly deteriorated affordability. Mortgage products have also become less accessible, as a large deposit has been required to secure the loan after the financial crisis of 2008/9. Previous studies point to the increasing role of intergenerational transfers in filling this gap. Some young adults obtain help from family to become homeowners, either receiving monetary support or by saving through living at the parental home. Using the Wealth and Assets Survey, this study attempts to examine the effect of these two types of family financial support on young adults’ homeownership circumstances, and controlling for other characteristics such as parental homeownership. First, it examines the characteristics of homeowners among young adults cross-sectionally using logistic regression. Second, by focusing on the non-homeowner sub-sample it analyses the effect of direct (money) and indirect (co-residence) family support on young adults’ entry to homeownership in the six-year period using discrete-time Event History Analysis. The results show that chances of young adults’ homeownership between 2008/10 and 2014/16 are very much tied to family support. The odds of becoming homeowners who have received direct or indirect support are found to be three times higher, even after accounting for other characteristics.

Keywords: Homeownership, young adults, intergenerational transfer, parental support, inequality, housing market

Suggested Citation

Suh, Ellie, Young British Adults’ Homeownership Circumstances and the Role of Intergenerational Transfers (April 8, 2019). © [Suh, 2020]. Author's final submitted version. The definitive, peer reviewed and edited version of this article is published in Longitudinal and Life Course Studies, DOI: 10.1332175795920X15846933259695, and available at: https://www.ingentaconnect.com/content/bup/llcs/pre-prints/content-llcs, Available at SSRN: https://ssrn.com/abstract=3368439 or http://dx.doi.org/10.2139/ssrn.3368439

Ellie Suh (Contact Author)

University of Oxford ( email )

United Kingdom

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

London School of Economics & Political Science (LSE) - Centre for Analysis of Social Exclusion (CASE) ( email )

London School of Economics and Political Science
STICERD, Houghton Street
London, WC2A 2AE
United Kingdom

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