The National Bank of Denmark has published a working paper examining how parents finance financial support for their children's first home purchases. The research finds that parental assistance is funded through both drawing down assets and increasing borrowing, with both channels playing an economically meaningful role when the purchase takes place. The paper uses population-wide Danish administrative data linking first-time buyers and their parents from 2000 to 2023 and tracks changes in parents' balance sheets in an event-study framework. It concludes that intergenerational support in the housing market reflects active leverage decisions by parents, with implications for household leverage, risk taking and housing market fluctuations over the cycle. The paper is presented as ongoing research and the conclusions are those of the authors rather than necessarily the views of the National Bank of Denmark.
National Bank of Denmark2026-06-10
National Bank of Denmark working paper finds parents fund first home support through asset drawdowns and increased borrowing
The National Bank of Denmark has published a working paper on how parents finance support for their children's first home purchases, finding that they draw down assets and increase borrowing. Using population-wide Danish administrative data from 2000 to 2023, the paper concludes that intergenerational housing support reflects active parental leverage decisions with implications for household leverage, risk taking and housing market fluctuations, and notes that the findings represent the authors' views rather than those of the National Bank.