More Parents Buying Apartments for Their Children

This is an amazing story, a testament to Americans' financial resilience amid the Obama Depression.

At New York Times, "The Gift Apartment From Mom and Dad":

FOR some parents, an engraved pen set just won’t cut it as a graduation present. It seems so insubstantial, so unoriginal. Anyway, the kid will just lose it. So how about a New York apartment?

Real estate brokers say that in the last year, they have seen more parents shopping for apartments for their grown children, hoping to take advantage of low mortgage rates and apartment prices that are still about 20 percent down from the market’s peak.

“I got a digital watch for graduation,” said Barry Silverman, an executive vice president of Halstead Property, “but I’ve worked with families where the children are getting an apartment.”

These congratulatory apartments are often studios or small one-bedrooms, but on occasion they are bigger-ticket items, he said, because “the parents see it as a long-term investment and a good place to park their money.”

In many cases, brokers say, the parents do not live in the New York area and view the apartment as a potential pied-à-terre for themselves when the child decides to move on. Some buy it as a straight-out gift, a gesture of profound affection sweetened by the current generous tax exclusion. Others buy it as an investment and retain ownership, and still others acquire it through a family trust for joint ownership.

These purchases raise a number of financial and estate planning questions, and lawyers and building managers advise parents to structure the arrangement carefully.

That's for sure. Check that link at top for the rest.