Homeownership rates for millennials in the U.S. have been steadily declining over the last decade, and nearly a third of them still live with mom and dad. But do you know where the so-called “American Dream” of homeownership is alive and well? China.
A study from HSBC found that some 70 percent of Chinese millennials are already homeowners, and 91 percent of the cohort plans to buy a house within the next five years. China had the highest millennial homeownership rates out of the nine countries included in the study, followed by Mexico (46 percent) and France (41 percent).
With a millennial homeownership rate of 35 percent, the United States was in the middle of the pack with Malaysia (also 35 percent). The countries with even lower proportions of millennial property owners included Canada (34 percent), the U.K. (31 percent), Australia (28 percent), and the United Arab Emirates (26 percent).
The study, which surveyed over 9,000 millennials in nine countries, found that the biggest barrier for aspiring young homeowners was the downpayment: Some 69 percent of respondents said that they don’t have enough money for a deposit.
On the flip side, for those that do own homes (about 40 percent of total respondents), parental support was a factor. According to the study, 36 percent of millennials who’ve purchased homes turned to the ‘Bank of Mum and Dad’ as a source of funding. As the BBC explains, in China, particularly, parents fund “marital houses” for sons to increase their chances at marriage, as well as invest in property in their children’s names.
“This study challenges the myth that the home ownership dream is dead for millennials around the world,” said Louisa Cheang, HSBC’s Global Head of Retail Banking.
“With four in ten already owning their home, the dream of home ownership for millennials is definitely alive and kicking. The greatest challenges are in those countries where there is a perfect storm of stagnating salaries and rising house prices—for millennials in those countries, the dream, while not dead, looks set to be deferred.”