Millennial renters have found the best lender in town. It’s called the Bank of Mom and Dad.
About 40 percent of those aged between 22 and 24 receive some form of financial support from their parents, the New York Times reported, citing surveys that track young people through their first decade of adulthood. Of those who get extra cash from ma and pa, the average amount is about $3,000 a year. That figure — which works out to $250 a month — covers 29 percent of the median monthly housing costs in America’s metro areas. The Times’ analysis also found that financial dependence among young people has been going up since the 1980s.
Just how much parents are forking out typically depends on the careers of their offspring, and where they live. Young people who live in cities with more than 1 million people are 30 percent more likely to have their parents help with rent than those who live in smaller cities, the Times analysis found. They also get twice as much support as their smaller-city peers, after controlling for other factors.
More than half twenty-somethings who are chasing careers in art and design get rent money from their parents. Those young people receive an average of $3,600 a year, the Times reported. People who are in farming, construction, retail and personal services get the least amount of help from mom and dad.
“Someone who wants to go into graphic design or marketing requires a fair amount of time to get up to the point where you’re independent,” said Patrick Wightman, assistant professor at the University of Arizona who helped the Times analyze data. “Someone contemplating that kind of career isn’t going to take that first step unless they know they’re going to have that support to take an unpaid internship. If you don’t have other sources of support, that’s not even an option.”
Rent in Manhattan and Brooklyn remains high, but has plateaued, according to recent reports from Douglas Elliman. In January, Manhattan’s median rent, after landlord concessions, was $3,259 a month. In Brooklyn, the median rent was $2,702 last month.