Thinking of Helping Your Kids Buy Their First Home? Here’s How to Do It Right

As home prices remain high and mortgage rules shift, many first-time homebuyers are leaning on their parents for financial help. If you’re a parent wanting to support your child’s first home purchase, but not sure how to do it wisely, you’re not alone.

Let’s walk through what’s happening in the market today and the best options available for parents like you.

Parents Are Stepping Up in Big Ways

• Over half of first-time buyers are co-buying with someone other than a spouse—often a parent.

• Gifts are generous, but 80% of recipients say they would’ve purchased anyway, though with compromises.

• More buyers are looking for homes with rental suites, creating flexibility for family or extra income.

A Financial Tool That’s Changing the Game: Reverse Mortgages (see more details in May post)

If you’re over 55 and own your home, a reverse mortgage can let you access your home equity—tax-free and with no monthly payments—to help your child buy their first home.

Why Parents Love Reverse Mortgages:

• Stay in your home and maintain ownership.

• Get a lump sum (or payments) from your home’s value.

• No required payments until you move, sell, or pass away.

Use the Funds For:

• Helping with a down payment or closing costs.

• Creating a basement suite or rental unit in a new multi-gen home.

• Keeping your RRSPs and investments untouched for retirement.

Other Options to Consider

Helping your child doesn’t mean draining your accounts. You may also want to explore:

• Joint ownership or co-signing the mortgage (be mindful of risks).

• Home Equity Line of Credit (HELOC)—if you want flexibility and control.

• Gifting funds now vs. leaving a larger estate later.

  • • Side bar, if you are looking for a great book, consider:
      

      Die with Zero, Bill Perkins

• Refinancing your mortgage to free up cash for support or renovations.

What You Need to Watch Out For

• Interest accrual on a reverse mortgage can reduce your estate’s value.

• Eligibility depends on age, home type, and location.

• Tax or legal consequences of gifting or co-owning should be reviewed with a professional.

Parents: You’ve Got Options—Let’s Find the Right One

Helping your child doesn’t have to mean hurting your own financial future. Whether it’s through a gift, joint purchase, or using your home equity with a reverse mortgage, you can empower your child’s first home purchase and keep your retirement goals intact.

Need help exploring your best options? Let’s talk.

I’ll help you look at all the strategies, from gifting to reverse mortgages and guide you through the process with your family’s future in mind.