For most of us, our housing needs are cyclical.1 A newly independent adult can find freedom and flexibility in even a tiny apartment. That same space, to a growing family, would feel stifling. For empty nesters, a large home with several unused bedrooms can become impractical to heat and clean. It’s no surprise that life transitions often trigger a home purchase.
While your home-buying journey may not
look like your neighbor’s or friend’s, broad trends can help you understand
what to keep in mind as you house hunt. No one wants to regret their home purchase
and taking the time now to think about exactly what you need can save a lot of
heartache later.
The
Newly Married or Partnered Couple
The financial and legal commitment of marriage has provided a springboard to homeownership for centuries, though these days more couples are buying homes without exchanging rings. In the last few decades, changing demographics have shifted the median age of first marriage and buying a first home into the late 20s and early 30s, planting most newly married or partnered buyers firmly in the millennial generation.2,3 But no matter your age, there some key factors that you should consider as you enter your first home purchase.
Affordability is Key
There is no doubt about it—with high
student loan debt and two recessions in the rearview mirror, many millennials
feel that the deck is stacked against them when it comes to homeownership. And it
is not just millennials—Americans of all ages are facing both financial
challenges and a tough housing market. But stepping onto the property ladder
can be more doable than many realize, especially in today’s low mortgage rate
environment.
While many buyers are holding out for
their dream home, embracing the concept of a starter home can open a lot of
doors.4 In fact, that is the route that most first-time homebuyers
take—the average home purchase for a 20-something is about 1,600 square feet.
While the average size increases to around 1,900 square feet for buyers in
their 30s, it is not until buyers reach their 40s that the average size passes
2,000 square feet.5
Chosen carefully, a starter home can be a
great investment as well as a launchpad for your life together. If you focus on
buying a home you can afford now with strong potential for appreciation, you
can build equity alongside your savings, positioning you to trade up to a
larger home in the future if your needs change.6
Taking Advantage of Low Mortgage
Rates
Mortgage rates are historically low, making
now the perfect time to purchase your first home together. A lower interest
rate can save you tens of thousands of dollars over the life of your loan,
which can significantly increase the quality of home you can get for your
money.
But what if both halves of a couple do not
have good credit? You may still have options. First, boosting a credit score
can be easier than you think—simply paying your credit cards down below 30% of
your limit can go a long way. But if that is not enough to boost your score,
you might consider taking out the mortgage in only the better-scoring partner’s
name. The downside is that applying for a mortgage with only one income will
reduce your qualification amount. And if you take that route, make sure you
understand the legal and financial implications for both parties should the
relationship end.
Commute and Lifestyle
Considerations
Whether you have lived in a rental together
for years or are sharing a home for the first time, you know that living
together involves some compromises. But there are certain home features that
can make life easier in the future if you identify them now. The number of
bathrooms, availability of closet space, and even things like kitchen layout
can make a big difference in your day-to-day life and relationship.
Your home’s location will also have a
significant impact on your quality of life, so consider it carefully. What will
commuting look like for each of you? And if you have different interests or
hobbies—say, museums vs. hiking—you will need to find a community that meets
both your needs. Need some help identifying the ideal location that fits within
your budget? We can match you with some great neighborhoods that offer the
perfect mix of amenities and affordability.
The
Growing Family
Having kids changes things fast. With a
couple of rowdy preteens and maybe some pets in the mix, that 1,600 square foot
home that felt palatial to two adults suddenly becomes a lot more cramped.
Whether you have just had your first child or are getting to the point where
your kids can’t comfortably share a bedroom any longer, there’s plenty to
consider when you’re ready to size up to a home that will fit your growing
family.
The Importance of School
Districts
For many parents, the desire to give
their kids the best education—especially once they are in middle and high
school— surpasses even their desire for more breathing room. In fact, 53% of
buyers with children under 18 say that school districts are a major factor in
their home buying decisions.7 Of course, better funded (and often
higher ranking) schools correspond to higher home prices. However, when push
comes to shove, many buyers with kids prefer to sacrifice a bit of space to
find a home in their desired location.
But when you’re moving to a new
community, it can be tough to figure out what the local schools are actually
like—and online ratings don't tell the whole story. That’s why talking to a
local real estate agent can be a gamechanger. We don’t just work in this
community; we know it inside and out.
Lifestyle Considerations
For many families, living space is a key
priority. Once you have teenagers who want space to hang out with their
friends, a finished basement or a rec room can be a huge bonus (and can help
you protect some quieter living space for yourself).
A good layout can also make family life a
lot easier. For example, an open plan is invaluable if you want to cook dinner
while keeping an eye on your young kids playing in the living room. And if you
think that you might expand your family further in the future, be sure that the
home you purchase has enough bedrooms and bathrooms to accommodate that
comfortably.
Functionality
Try to think about how each room will fit
into your day-to-day. Are you anticipating keeping the house stocked to feed
hungry teenagers? A pantry might rise to the top of the list. Dreading the
loads of laundry that come with both infants and older kids (especially if they
play sports)? The task can be much more bearable in a well-designed laundry
room. Imagine a typical day or week of chores in the house to identify which
features will have the biggest impact.
Chances are, you won’t find every
nice-to-have in one home, which is why identifying the must-haves can be such a
boon to the decision-making process. We can help you assess your options and
give you a sense of what is realistic within your budget.
The Empty Nesters
When we talk about empty nesters, we
usually think about downsizing. With kids out of the house, extra bedrooms and
living space can quickly become more trouble than they’re worth. While the
average buyer under 55 trades up to a larger home, buyers over 55 are more likely
to purchase a smaller or similarly sized but less expensive home. Even in the
highest age groups, the majority of home purchases fall in the single-family
category. According to research by the National Association of Realtors, by the
time buyers reach their 70s, the median home size drops to 1,750 square feet.5
But there’s plenty for empty nesters to think about besides square footage.
Maintenance and Livability
What factors are driving your decision to
move? Identifying those early in the process can help you narrow down your
search. For example, do you want to have space for a garden, or would you
prefer to avoid dealing with lawn care altogether? What about home maintenance?
In many cases, a newer home will require less maintenance than an older one and
a smaller one will take less time to clean. You may also want to consider
townhomes, condos, or other living situations that don’t require quite as much
upkeep.
Lifestyle Considerations
Many empty nesters have retired or are
nearing retirement age. This could be your chance to finally pursue hobbies and
passions that were just too hard to squeeze into a 9-5. If you’re ready to
move, consider how you’d like to spend your days and seek out a home that will
help make that dream a reality. For some, that might mean living near a golf
course or a beach. For others, being able to walk downtown for a nice dinner
out is the priority. And with more time to spend as you wish, proximity to a
supportive community of friends and family is priceless.
Ability to Age in Place
Let us face it—we cannot escape aging. If
you are looking for a home to retire in, accessibility should be front-of-mind.8
This may mean a single-story home or simply having adequate spaces on the first
floor to rearrange as needed. While buying a home that you plan to renovate
from the start is a viable option, being forced into renovations (because of
the realities of aging) a few years down the road could seriously dig into your
nest egg. Location matters, too—if your family will be providing support, are
they close by? Can you easily reach necessities like grocery stores and
healthcare? While it is tempting to put it out of our minds, a few careful
considerations now can make staying in your home long-term much more feasible.
Finding
the Right Home for Right Now
One thing is for sure life never stands
still. And your housing needs will not, either. In the United States, the
median duration of homeownership hovers around 13 years.9 That means
many of us will cycle through a few quite different homes as we move through
different life stages. At each milestone, a careful assessment of your housing
options will ensure that you are well-positioned to embrace all the changes to
come.
Whatever stage you are embarking on next, we are here to help. Our insight into local neighborhoods, prices, and housing stock will help you home in on exactly where you want to live and what kind of home is right for you. I have worked with home buyers in every stage of life, so we know exactly what questions you need to ask. Buying a home—whether it is your first or your fifth—is a big decision, but we are here to support you every step of the way.
Call/Text: 559 429-5478 or email:
Mirna@EnvisionFresno.com
I
support the Fair Housing Act and equal opportunity housing.
Sources:
1. Freddie Mac -
http://www.freddiemac.com/blog/homeownership/20190104_homebuying_lifecycle.page
2. PRB -
https://www.prb.org/usdata/indicator/marriage-age-women/snapshot/
4. Nerdwallet -
https://www.nerdwallet.com/article/mortgages/starter-home-forever-home
5. NAR 2020 Home Buyers and
Sellers Generational Trends Report -
https://cdn.nar.realtor/sites/default/files/documents/2020-generational-trends-report-03-05-2020.pdf
6. Investopedia -
https://www.investopedia.com/personal-finance/what-look-starter-home/
7. NAR 2019 Moving With Kids
https://www.nar.realtor/research-and-statistics/research-reports/moving-with-kids
8. Kaiser Health News -
https://khn.org/news/baby-boomers-aging-aging-in-place-retrofit-homes/
9. National Association of
Realtors -
https://www.nar.realtor/blogs/economists-outlook/how-long-do-homeowners-stay-in-their-homes#:~:text=As%20of%202018%2C%20the%20median,varies%20from%20area%20to%20area
