Parental support in Williamsburg

An article in today’s New York Times sheds some much needed light on the extent to which parents give money to their children.

Young people who never had to work until the lifeline was cut off because the recession adversely affected their parents’ income:

Luis Illades, an owner of the Urban Rustic Market and Cafe on North 12th Street, said he had seen a steady number of applicants, in their late 20s, who had never held paid jobs: They were interns at a modeling agency, for example, or worked at a college radio station. In some cases, applicants have stormed out of the market after hearing the job requirements.

“They say, ‘You want me to work eight hours?’ ” Mr. Illades said. “There is a bubble bursting.”

The large number of condos and coops which are purchased with help from parents:

In the boom years, Mr. Weinstein said, 40 percent of the mortgage applications he reviewed for buyers in Williamsburg included down-payment money, from $50,000 to $300,000, from parents. About 20 percent of the applications listed investments that gave the young buyers $3,000 to $10,000 of monthly income.

Those “investments” are presumably trust funds. It’s not clear to what extent the two categories overlap, or if 40% have direct aid from parents when obtaining a mortgage then how many more have indirect aid such that it’s not obvious to Mr. Weinstein? I think it’s safe to assume that more than 50% of young people in Williamsburg have significant parental support.

However, parental support is largely invisible, because people hide it:

It can be hard to see the signs of financial troubles in Williamsburg because residents are so loath to show that they had money in the first place. Robert Lanham, author of “The Hipster Handbook,” said in an interview that many newer residents tried to blend in with the area’s gritty history and dressed “half the time like they’re homeless people.”

But parental help was obvious in the intersection of residents with low-paying jobs and $3,000-a-month apartments.

“You can put two and two together, that they have money coming in from somewhere else,” Mr. Lanham said.

The culture of the area often mocks residents who depend on their families. Misha Calvert, 26, a writer who relied on her parents during her first year in the city, now has three roommates, works in freelance jobs and organizes parties to help keep her afloat while she writes plays and acts in films. There is a “giant stigma,” she said, for Williamsburg residents who are not financially independent.

“It takes the wind out of you if you’re not the independent, self-reliant artist you claim to be,” she said, “if you’re just daddy’s little girl.”

Hidden parental support is very harmful to young people with middle class parents who don’t understand that their peers are able to go into fields which don’t offer any obvious pecuniary rewards because they don’t actually need the money. It causes poor choices in life. It would be better if this stuff were more out in the open.

Comments

[Peter A]

This has been going on for a while. I wonder if eventually this will undermine the current elite to some extent? The kids we hire into our consulting firm tend to come from second tier but still good schools - Catholic universities, state universities, etc. These kids work their asses off for us, I've never had issues with attitude or work ethic. There are plenty of American 20 somethings who know how to work. I assume in 20 years most of these kids will be fairly successful and prosperous, while the Williamsburg kids will have pissed away their parents' money and become disaffected radicals mad at a society that refuses to acknowledge their worth. Then the children of my young associates will probably go off to Ivy league schools, get infected with Bohemian dreams, go off to live in whatever the Willamsburg of 2040 will be and the cycle will continue...

[40oz of Hate]

Hysterical.

[Peter]

It's rather hard to have much sympathy for the hipsters who now might actually have to, you know, *work*.

[al]

I agree completely

huge numbers of children from middle middle class backgrounds go in to fields like art, theatre, architecture, and don't realize that very few people can make a living doing these things.

There needs to be more honesty in our society about how hard to make a living certain fields are

[sabril]

Halfsigma, I am officially offering you a lunch on me at a coffee shop / restaurant in Boerum Hill, Brooklyn.

With any luck, we will see plenty of urban hipster SWPL types, complete with Mac Notebooks and ironic t-shirts, working on their screenplays or whatever during the middle of the day.

;)

[Peter]

Being a little naive, I always wondered how my 26 year old peers could afford down payments on houses I was nowhere close to affording. When I mentioned this to my parents, they said, "It's cause their parents help with the cost."

Should have been obvious to me.

[The Engineer]

My bro saw this first hand when he was trying to buy in Park Slope. He simply couldn't compete with the trust funders, despite being a VP at Goldman.

I like the guy who "worked in satellite radio". Yeah? Like he installed them or something? What does that mean, anyway?

I work in satellite radio, too. I've got XM on all day at work!

[HS: It means he had a job at Sirius. Possibly an unpaid internship. He probably majored in communications at a liberal arts school.

Hipsters don't do prole jobs like installing stuff into cars.]

[Ron]

Half Sigma,

I have worked hard and am financially successful

it seems to me that me and my wife get the most benefit from encouraging our sons to find the right (very high IQ) girls in college, get married and start producing my grandchildren right away.

My point is, it seems I should buy them houses in Larchmont or Scarsdale (where everyone else has kids and where the public schools are great) instead of buying them apartments in hipster neighborhoods

I just can't understand why other parents are willing to buy in hipster neighborhoods when that means a long delay in childbearing when instead they could buy a house and encourage faster childbearing.

by the way I want my sons to continue to have a good work ethic and do well professionally, but i am willing to sap a little of their motivation by buying them a house in the suburbs if it results in more grandchildren earlier

[king obama]

I find it funny that these hipsters try to hide the fact that they get massive parental support.

Like a 24-year-old who works part-time in an art gallery is going to be able to afford a 3,000/month apartment. Yeah, right.

[Turambar]

Yes you Can! Work for minimum wage.

If the Times wants to stay in business they need to make this a regular reporting feature....

[APH]

As far as white people go, Staten Island will soon be home to the last "real" New Yorkers - Whites in the the boroughs are mostly either:

1) wealthy / elite / "global" citizens
2) SWPL transplants
3) hipster transplants
4) recent immigrants

[HS: 5) guidos]

[uselessidiot]

There was a time when people were proud to come from upper-class families. Some people still are.

Only a liberal could be ashamed of what their forebears accomplished, instead of being grateful for the opportunity to pursue a non-productive life. It is a grand tradition of Western civilization for the idle rich to occupy themselves with art and culture. Even Marx himself was a child of lesser nobility.

[Proud_Parent]

Those parents who give their children 1/10 of the help their parents gave them should be proud.

[The Engineer]

Maybe that's why SWPLs are welfare loving liberals. They're on a form of welfare themselves.

[Wilberforce Simonson]

I know several parents who lavish money on their children, and it is damaging to the children and to the relationship.

First, giving excess money delays children’s transition to independent adulthood and teaches children dependency, i.e., they start to believe that they are unable to support themselves. [HS: If they're an artist, then they probably ARE unable to support themselves.]

Second, many parents use financial aid in attempt to control their children’s actions and threaten to terminate the support if their children do not comply. Some children, who have completely learned dependency, comply but resent their parents, which strains the relationship and teaches that parental love is conditional. Other, more defiant, children commit self-destructive acts in response to the cessation of financial aid, such as deliberately choosing a bad boyfriend or career (e.g., drug dealing or stripping).

[40oz of Hate]

"I find it funny that these hipsters try to hide the fact that they get massive parental support."

A central tenent of hipsterism: Paying big $ on clothing so you can look like you shop at Goodwill. These idiots will be drinking Pabst, and not by choice, sooner than they think.

[The White Detroiter]

In the Detroit area it seems more common for unmarried twentysomthings to just never move out of their parent's homes and live rent free. It's not ideal but it makes more sense for mom & dad financially than supporting the costs of multiple households. Also if you're not going to an elite college it doesn't matter much which school you attend so it's often better to save on room & board and just commute to a nearby college to earn your degree.

I wonder if there are gender differences in rates of parental support. Does anyone know of any data on this subject?

[HS: I suspect that daughters get more support, but I don't have statistics. Anyone?]

[Brutus]

"I just can't understand why other parents are willing to buy in hipster neighborhoods when that means a long delay in childbearing when instead they could buy a house and encourage faster childbearing."--Ron

Ron, buying in a [newly] hipster area makes brilliant economic sense. Has it ever occurred to you how neighborhoods suddenly become cool? Take Manhattan's Soho, which as recently as the late '70s was a hellhole. Artists moved in and renovated the lofts. Galleries and restaurants followed. Etc.

When I was in my 20s both my maternal grandparents helped support my artistic endeavors (that translates into they gave me my inheritance before they died). Today I work with some of the world's greatest photographers, have published 5 books, and produce television shows. Thanks to my grandparents.

[rightwingnut]

"Then the children of my young associates will probably go off to Ivy league schools, get infected with Bohemian dreams, go off to live in whatever the Willamsburg of 2040 will be and the cycle will continue..."

Posted by: Peter A | June 09, 2009 at 10:25 AM

And so goes the saying "From shirtsleeves to shirt sleeves in three generations."
One generation to make it
A second to enjoy it
A third to squander it

[The White Detroiter]

http://www.psc.isr.umich.edu/pubs/pdf/rr01-487.pdf

Here's a paper from the "Population Studies Center At the Institute for Social Research, University of Michigan" with some data on this issue. It is called "All the Ties that Bind: Race, Ethnicity, and Why Families Support Adult Children". It examines datasets from 1992 and 1994 of parents born between 1931 and 1941 who were supporting non-resident adult children.

Females were slightly more likely to receive support from parents in all three racial groups studied (whites, blacks, latinos). Racial differences were larger with whites being supported at higher rates and receiving larger mean amounts. Interestingly whites were much more likely to receive support if their income was less that $10,000 versus greater than $25,000 while for blacks and latinos their income had no apparent inpact on whether they received support. Years of education by parents played an important role in the racial gaps. Much of the overall difference appeared to be due to the fact that a larger proportion of white parents attended some college or are college graduates. Giving rates were more similar between racial groups when years of education are held constant.

I haven't found any more recent data yet. It would be interesting to see how things have changed.

[sabril]

I agree with Ron. If I had the money, I would be delighted to help my hypothetical adult children along the road to family formation.

Siggy, will you take me up on my offer or not? I promise I won't comment publicly on our conversation if you agree to do the same.

[DaveinHackensack]

"In the Detroit area it seems more common for unmarried twentysomthings to just never move out of their parent's homes and live rent free."

Time for them to buy foreclosed homes in Detroit and create their own Williamsburg there. There was a recent article (in the NY Times?) about artists starting to do just that, and they were literally buying houses for less than $1,000 each. If enough of them do it, there could be a huge ROI on those investments a few decades from now. Not an exact example, but consider this: friends of my parents bought a two-bedroom apartment on the Upper West Side of Manhattan in the early 1970s, when NYC was dirty, dangerous, and in decline economically. They paid $10k for it. It's probably worth close to $1 million today (doorman building, great neighborhood).

[Peter]

"I suspect that daughters get more support, but I don't have statistics. Anyone?"

Makes sense, as parents are likely to be more concerned about the urban neighborhoods in which their daughters live. It might be okay for a son to live in a "edgy" 'hood, but not a daughter.

[BrunoBrazil]

Effect of loss of wealth

You know, SWPLness is resultant of wealth.

To work, get a good job, hold a job continuously for the most you can, raise the next generation are not an end in itself for many people. That is why people drift to SWPLness (to travel, study liberal arts, look like an intellectual and not to get into big company). You have money enough to not to worry so much with your survival to the point you can "waste" years of your life being an artist.

Imagine when China becomes rich having families with only one child. They will win over the US even on SWPLness.

[BrunoBrazil]

What happens to most artists and liberal arts graduates when they get older?

I think they become the same corporate drone they dispised, but starting older. They retrain, get a second degree, go to law school.

[BrunoBrazil]

Personally, I am relatively flexible when it comes for adults living with parents. I live with my parents, contribute and it is standard in the brazilian culture.

But, in this case, get real. Not working until you are 30, depend massively on your parents to pay your rent, live as an artist but have an expensive apartment, iMac and spend your day writing poetry and sipping starbucks to look "intellectual" and "artistic"? Gimme a break! These people must have a hard lesson on reality.

[eh]

I thought it was Williamsburg, Virginia.

[superdestroyer]

I wonder how many of those SWPL's are cheating on their taxes. If their parents are giving them more than $12K of support, then they should be reporting it and paying gift taxes. Instead, I suspect that most of them are cheating on their taxes and the 20-something have factored that into the cost of living in NYC. It also explains why 20 somethings want free health care from the government.

It is the same as how Asian owned business use their kids but never pay them a wage.

[HS: It's $12K per person, so a married couple can give $24K per year. I'm sure it's cheated on as much as the nanny tax.]

[Turambar]

"Siggy, will you take me up on my offer or not? I promise I won't comment publicly on our conversation if you agree to do the same."

Awesome- this is getting an Althouse feel.

[HS: I've met blog readers before. I do have an email address listed for people who want to get in contact with me.]