At Hughes & Company Real Estate, we work with families at every stage of life—from first-time buyers to seasoned homeowners ready to downsize. One question I’m getting more often these days from local parents is, “How can I help my child buy a home?” With rising home prices and tightening credit standards, it’s no surprise many parents want to offer a financial hand up. If you’re a homeowner in Liberty Hill or anywhere in Central Texas, the good news is—you may already have the resources to help your child achieve the dream of homeownership. It starts with understanding how to use the wealth you’ve built in your own home.
Here are several smart, strategic ways parents can use savings, equity, or existing real estate wealth to support the next generation:
1. Tap Into Home Equity with a HELOC or Cash-Out Refinance
Your home has likely appreciated in value over the past few years. A Home Equity Line of Credit (HELOC) or a cash-out refinance allows you to borrow against that equity, often at lower interest rates than other types of loans. These funds can be used to:
- Help with a down payment
- Cover closing costs
- Offer a short-term private loan to your child
✅ Tip: Talk to your lender and a trusted financial advisor to evaluate whether this is the right move for your overall financial plan.
2. Gift a Down Payment
The IRS currently allows you to gift up to $18,000 (per person, per year as of 2025) without triggering a gift tax. For married couples, that’s up to $36,000 per year to one child—and even more if you include their spouse. This is one of the most straightforward ways to help your child get a head start.
✅ Tip: Be sure to document the gift appropriately, as lenders will require a formal gift letter stating the money does not need to be repaid.
3. Co-Sign on the Mortgage
If your child is financially responsible but hasn’t yet built a long enough credit history or income to qualify for a home loan on their own, you may choose to co-sign the mortgage. This can improve their debt-to-income ratio and help secure better loan terms.
🚨 Caution: Co-signing is a serious commitment—you’ll be legally responsible for the loan if your child can’t make payments. Be sure to weigh the risks and have honest conversations up front.
4. Purchase the Home and Sell It to Your Child Later
Some parents choose to buy a home in their name and allow their child to live in it while building credit or saving for a down payment. Once they’re financially ready, you can sell it to them—possibly at a favorable price.
✅ Tip: Work with your real estate agent and tax professional to structure this arrangement carefully, especially when it comes to future title transfer and potential tax consequences.
5. Consider a Shared Equity Agreement
A shared equity agreement allows you to co-invest in the property with your child. You both contribute toward the down payment and own a portion of the property. When the home is sold down the line, profits are divided based on the ownership percentage.
This is a more formal arrangement but can be a win-win—your child gets a home, and you may benefit from future appreciation.
Why It Matters in Central Texas
In markets like Liberty Hill, Leander, and the Greater Austin area, home values are continuing to rise. Getting in early, especially with a little help, can create long-term stability for your children and even open the door to generational wealth. Whether your child is staying close to home or planting roots in a nearby city, we’re here to help guide you through every option.
Let’s Talk Strategy
Helping your children become homeowners is a beautiful and generous act—but it also requires thoughtful planning. At Hughes & Company Real Estate, we don’t just guide homebuyers and sellers—we build multigenerational strategies that support your family’s legacy.
If you’re ready to explore how to leverage your assets to support your child’s homeownership journey, we’d love to sit down with you and explore the best route forward. Contact us today!
📍 Serving Liberty Hill and Central Texas with heart, experience, and family-focused advice.
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