Parental Influence on Their Children’s Homeownership Remains High, but Declining

Abstract

Homeownership is far less prevalent in Germany than in most other European countries. This Weekly Report examines the extent to which homeownership in Germany depends on the ownership status of parents and how the association has changed over time. Homeownership rates are significantly lower among younger birth cohorts than among older cohorts. At the same time, intergenerational mobility toward renting is increasing: adult children of parents who own their own homes are more likely to move into rentals. Children whose parents rent are less likely to buy a home. The relative association between parental homeownership and children owning homes is declining significantly over time. However, unequal opportunities for homeownership based on family background remains an ongoing issue in Germany. In a European comparison, the homeownership status of children in Germany still depends relatively strongly on that of their parents. To counteract this, it could be useful to remove equity barriers for specific target groups, such as young families.