During this latest election cycle, we’ve heard a lot about adult children living in the basement of their parents’ homes. How does this situation affect the real estate market and construction industry?

The job market for young adults has been improving gradually since 2010, yet the number of young professionals living with their parents is continuing to climb. As recently as this year, about 26 percent of millennials – those aged 18 to 34 – are living with their parents, according to the Pew Research Center. The trend is most pronounced among 25 year olds. Why is that?

The truth is that most of the millennials would love to move off on their own rather than back under their parent’s roof, but due to all of the college loans and difficulty finding a job, or at least a job with a decent salary and benefits, they are forced to move back home. If it weren’t for the astounding tuition costs, other staggering expenses and their salaries incapable of offsetting these rising expenses, you could be sure that a lot more millennials would choose their own independence over reverting to a place of inadequacy.

But financially speaking, the growing number of young adults living with their parents threatens their parents’ retirement financially and psychologically. Baby boomers who support adult children are much more likely than other baby boomers to report moderate to high financial anxiety. So is it time for baby boomers to show some “tough love”? Many say that baby boomers shouldn’t allow their adult children to move back home, even when they struggle to find a job or manage their money. If they do absolutely have to move back home they need to pay rent and the terms need to be inked on paper.

On the other hand, taking care of children in need, even if they are young adults, is making a stronger family. You know, what goes around comes around. When parents force their unprepared children out on their own, what can the parents expect when they themselves are in need of care and support in their later years? This is a country of lonely elderly people and when I see an RV with a bumper sticker that says “We are spending our children’s inheritance,” I can only think “there goes a couple whose children won’t answer their calls someday!”

So what is the solution?

I’m not in favor of big federal programs, but this is an area where careful consideration of federal money for housing can be applied in the form of low down payments and lower interest rates. The higher the education of the individual young adult is, the more likely that he or she will be able to pay the loan back, so interest rates and down payments would be tied to excellence in education.

I think it would stimulate harder studying and construction of new housing for young adults as well.

Am I dreaming only?

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