Moving back home to save for a house: How to make it work

By Barbara Marquand | NerdWallet

After starting a career in engineering in Boynton Beach, Florida, Moisey Abdurakhmanov was renting a home with friends when he decided he wanted his own place.

“I realized I was basically paying somebody else’s mortgage every month,” he recalls.

So when the lease was up, he moved back home with his parents, saved every dime he could and bought a house five months later in January 2021 — “easily one of the best decisions I’ve made.”

Many millennials are taking a similar path to homeownership. About a quarter (24%) of people ages 25 to 33 who bought a home between July 2022 and June 2023 said they moved in directly from a family member’s home, according to a National Association of Realtors’ survey. Last year 29% of people who planned to buy a home in the next 12 months had already moved in with their parents to save money, and another 22% said they’d consider doing so, according to a May 2023 survey by Realtor.com and Censuswide.

With high housing prices and rising mortgage rates, you might think saving for a house will take ages. Moving in with parents can speed up the process and eliminate the headache of synchronizing a home purchase with the end of a rental lease.

But the strategy comes with challenges, no matter how much you like your folks. Here’s how to make it work.

Clarify your savings goals

Before broaching the idea, research the market where you plan to buy, figure out how much home you can afford and set a savings goal.

The two biggest upfront expenses are the down payment and closing costs. Minimum down payment requirements vary by mortgage type. Some conventional loans have minimum down payments as low as 3%, but the more you put down, the less your monthly payments will be. Closing costs range from about 2% to 6% of the loan amount.

Consider taking a first-time home buyer’s class to learn about the process, and consult with a lender or two. When you’re ready to shop for a home, you’ll want to get preapproved for a mortgage. When you’re still months away from house hunting, apply for pre-qualification — a less intense process — to see how much you may be able to borrow and what your monthly payments might be.

Then set a time frame. How long will it take to reach your goal if you move back home?

Discuss expectations — yours and your parents’

Have a conversation with your parents about your goals and time frame. Express your expectations about moving in, and ask them about theirs.

“We can avoid distress by recognizing our own expectations first and then communicating clearly with each other about what we’re hoping for … A red flag for me would be if the parent says yes without any conversation about expectations. That would set up a recipe for ill feelings on the back side,” says Saundra Davis, founder of Sage Financial Solutions, a nonprofit financial education and planning agency in the San Francisco Bay Area.

Give space for discussing pros and cons and how you’ll navigate the challenges, including the emotional ones. Understand that there may be mixed feelings about the new living arrangement. “Very few people feel 100% bad about something or 100% good about something,” says Ed Coambs, a certified financial therapist, fee-only certified financial planner and author of “The Healthy Love & Money Way: How the Four Attachment Styles Impact Your Financial Well-Being.”

Some parents and adult children may feel a stigma about moving back home, but don’t let societal pressures subconsciously drive your decisions.

“I think that the United States as a culture has normalized what we call ‘launching.’ If you look at other cultures and in the Black community, it is not abnormal for our kids to stay home longer,” says Davis, who is also a mindfulness teacher and master certified coach. The “failure to launch” concept can put extra pressure on parents and young adults. “If there is shame, where does it come from? Do we believe it? And does it serve us?” Davis says.

Sort out those feelings and do what’s best for you and your family.

Agree on household responsibilities

“The question is, what does it look like for us as mature adults and family members to live in this space together?” Coambs says.

Will you chip in for household expenses? How much? Will you share groceries? Who will do the shopping? What about cooking and cleaning? Will you call home if you’re going to be out late?

All of these — and more — are up for discussion.

Abdurakhmanov, who moved back home in August 2020, says his folks agreed to let him stay rent-free and fully supported his plan to buy a house. But the transition was still an adjustment.

“When I went from having the freedom to do what I want, when I want, to being under the roof of my parents again, there was a lot of headbutting between how I wanted to live my life and what my parents wanted me to do,” he says. “It was a little rough.”

So they talked.

“I drew some boundaries and told them there were certain things that we would just not argue about anymore … We all agreed to shift our focus and look forward to the future.”

Meanwhile, Abdurakhmanov agreed to join his parents more frequently for family dinners and events. “They had missed spending time with me … They felt I was drifting away from them, and they didn’t like that, which is understandable. I can see where they were coming from.”

Schedule regular family check-ins

Keep communication lines open after you move in. Set a regular time to check in about how things are going.

What’s working well with the living arrangement? What could be handled better? Are you on track with meeting your saving goals? Do you need to adjust the timeline?

It doesn’t have to be a formal business meeting. In fact, these conversations might go better during a meal or a relaxed outing.

Listen and empathize

No matter how well you’ve planned and communicated, occasionally you’ll get on each other’s nerves. Listen and be curious.

“Often we get stuck in our own perspective or what we think is the other person’s perspective,” Coambs says. “When we can insert empathy into the relational dance, oftentimes it can loosen things up and open up new options.”

Then the potential payoff from moving back home is more than a home down payment.

“It can also represent a great opportunity to continue to grow and nurture your adult-to-adult relationship with your parents,” Coambs says.

Abdurakhmanov says living with his folks helped prepare him for his next chapter. “It was a good buffer period for me to reestablish myself and everything about me that I wanted to take forward moving into my own place.”

Barbara Marquand writes for NerdWallet. Email: bmarquand@nerdwallet.com. Twitter: @barbaramarquand.

The article Moving Back Home to Save for a House: How to Make It Work originally appeared on NerdWallet.