Deanna Valeo
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My Parents Need Help, How Can I Buy Them a House for 5% down?

When It's Time To Give Back

Children can buy their parents a House for as little as 5% down
: There is a little known mortgage product that allows children to buy a home for their aging parents and get owner occupied rates as well: even if the house is right next door.  This Fannie Mae product also allows parents to buy the same way for physically or mentally challenged children.

Changes in demographics will drive the need for Millennial's and Gen Xer's to help their parents buy a home or contribute to their monthly living expenses.  Interest rates are low and home prices are growing many adult children are discovering the financial benefit of buying a home for their relocating parents as opposed to renting an appartment.

Often a financial need will drive a child's need to help a parent buy:

Baby Boomers do like independence and often want to stay in single family homes as long as they can, they are willing to down size when needed and many now want to relocate to where their kids live. Many will continue to work, often part time and yet because the 2008 recession, low savings rates and/or a major medical expense many will need help when it comes to housing.

Combine these facts with 4-Million+ baby boomers retiring each year and according to the Employee Benefit Research Institute only 24% of baby boomers have saved over $100,000 for retirement.  Many Millennials and Gen Xers are going to need to pick up the slack.


Charlotte is the second fastest growing major city in the United States:

In Charlotte we have seen a large growth of transplants to our city.  Charlotte's population grew over 40% from 2000 to 2010 according to the latest US census.  The Charlotte-Concord-Gaston NC-SC Metropolitan Statistical Area (MSA) is now over 2.3M in population (only 8.5% > 65 year of age). 

The growing population of young professionals in Charlotte will increase the demand for housing for their parents as they age.  Using Fannie Mae's special product we can help children meet the needs of their parents with very little money out of pocket, what we have seen adult chrildren are buying homes for parents who could not qualify for a purchase due to income limits (or credit issues).  The parents contribute to the housing expense and the kids have an investmet in real estate without having to put a10-25% down payment.  Overall it is a win-win for everyone. 

 
References:
Charlotte Metropolitan Area http://en.wikipedia.org/wiki/Charlotte_metropolitan_area
Are aging baby boomers abandoning the single family nest?  http://www.fanniemae.com/resources/file/research/datanotes/pdf/housing-insights-061214.pdf
Charlotte quick facts from the US census:  http://quickfacts.census.gov/qfd/states/37/3712000.html
 

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