First-Generation Homeowners See Greater Importance in Owning a Home Over the Past Year

First-Generation Homeowners See Greater Importance in Owning a Home Over the Past Year

Long before their purchase, first-generation buyers say their families influence their thoughts about homeownership
first-generation homeowners moving into their new home

Buying a home is a huge milestone to achieve, and one that many families and individuals continue to work toward. For some groups in particular, this goal carries even greater importance.

In its 2021 Homebuyer Insights Report, Bank of America found that first-generation homeowners are much more likely than non-first-generation homeowners — that is, those whose parents or grandparents owned a home — to say that the importance of homeownership has increased over the last year (69% versus 43%).

Familial influence impacts how first-generation homeowners approach the homebuying process

The Bank of America survey also revealed that first-generation homeowners in the U.S. were more likely to believe the importance of building equity has increased (61% versus 39%) and appreciate the safety and security of homeownership (73% versus 60%) than those with family members who have owned a home before them.

"For many first-generation homeowners and their families, homeownership has a unique importance, given the collective efforts to overcome financial challenges that can often span generations," AJ Barkley, head of neighborhood and community lending at Bank of America, said in a statement.

"Achieving this goal can create a sense of pride and accomplishment that resonates both for the buyer and those closest to them, including their parents and future generations."

Perhaps because of this sense of duty to own a home, twice as many first-generation homeowners (43%) purchased a home because they believed their parents expected it from them, compared to the 20% of non-first-generation respondents who thought the same. The report revealed other familial influences on this cohort of homeowners as well, including:

  • 75% of first-generation homeowners said their families taught them the importance of building good credit
  • 37% said they received financial assistance from their parents to buy a home

This additional support throughout the homebuying process may be why a greater percentage of first-generation homeowners expect to buy another home in the future (74% versus 57%).

Challenges still remain for many would-be homebuyers

A different survey from Chase found that 60% of consumers who have never owned a home plan to purchase one in the next 12 months. Still, prospective homebuyers face many challenges on the road to homeownership — regardless of whether they received support from their family.

The Bank of America report found that the majority of hopeful buyers (89%) agreed they could do more to save money for their purchase, while only 24% are proud of their credit score. More than half of respondents also cited high rent costs (57%) and expensive home prices (54%) as reasons for their inability to save for the upfront costs of homeownership.

According to other findings, the homebuying process is even more difficult for Black and Latino would-be buyers — a recent NeighborWorks America survey showed that, compared to their white counterparts, these consumers are more likely to experience financial difficulties during the homebuying process.

With these concerns in mind, it's little wonder that 35% of respondents said they'd save for a home if they were given $20,000. Other top responses included:

  • Paying off debt (22%)
  • Saving for the future (17%)
  • Buying a car (11%)

Methodology: On behalf of Bank of America, Sparks Research conducted a national online survey from Feb. 18-March 1, 2021, of 2,000 adults (ages 18 and older) who currently own a home or have plans to do so. An oversample of 363 first-generation homeowners was also polled for this report.