The study of the changing roles of parents in home purchase for their children in Hong Kong

Abstract

Young people in Hong Kong is now facing the problem of housing affordability. Many studies have done before to assess the affordability. Most of the studies focused on the reason of housing affordability but seldom assessed the outcome of the problem. On the other hand, some overseas and local studies have been done on the phenomenon of intergenerational transmission in housing and they found it was connected to the housing affordability. However, there is a lack of study on the how the parents support their children in home purchasing and the effects of their support which is worthy to study as these effects may affect the sustainability of this phenomenon. Parental support, especially in monetary terms, was not common in Hong Kong until recent years. People in the past used to save money for down payment and seldom asked help from parents. The situation has been changed in recent years. there is increasing number of media and public opinion claiming that young people could not be able to purchase their home without monetary assistance from their parents. In fact, there is serious housing affordability problem these years. Some studies have reviewed the relationship between housing affordability and intergenerational transmission, showing they are corelated. Parental support could help young people to shorten the saving time for down payment and increase their affordability. With expectation on upgoing housing price, the shorter the saving time is preferred by potential home buyers. Besides, the source of money of the parents is worthy to be studied for the assessment on the sustainability of parental support. Parents can make money from many ways but some of them may cause potential risk for the parents and the economy.

After having study on the mentioned areas, recommendations could be made to solve the problem and to maintain a sustainable development of the economy and the society of Hong Kong.