Posted On: September 3rd, 2021 3:14PM
9 Tips for Buying and Selling Your Home at the Same Time
Selling your home when you still need to shop for a new one can feel daunting to even the most seasoned homeowner––especially when the demand for new homes keeps rising, but the supply feels like it's dwindling.¹ You're not alone either if you're already feeling drained by the complex logistics of trying to sell and buy a new home all at once.
Searching for a new home can be exciting, but many homebuyers admit that it can also be stressful, especially if you live in an unpredictable market with plenty of competitors. Unfortunately, waiting out a competitive housing market isn’t always the best idea either since listings are expected to remain limited in the most coveted neighborhoods for some time.²
That doesn't mean, though, that you should just throw up your hands and give up on moving altogether. In fact, as a current homeowner, you could be in a better position than most to capitalize on a seller’s market and make a smooth transition from your old home to a new one.
We can help you prepare for the road ahead and answer any questions you have about the real estate market. For example, here are some of the most frequent concerns we hear from clients who are trying to buy and sell at the same time.
“WHAT WILL I DO IF I SELL MY HOUSE BEFORE I CAN BUY A NEW ONE?”
This is an understandable concern for many sellers since the competitive real estate market makes it tough to plan ahead and predict when you'll be able to move into your next home. But chances are, you will still have plenty of options if you do sell your home quickly. It may just take some creativity and compromise.
Here are some ideas to make sure you're in the best possible position when you decide to list your home:
Tip #1: Flex your muscles as a seller.
In a competitive market, buyers may be willing to make significant concessions in order to get the home they want. In some cases, a buyer may agree to a rent-back clause that allows the seller to continue living in the home after closing for a set period of time and negotiated fee.
This can be a great option for sellers who need to tap into their home equity for a downpayment or who aren’t logistically ready to move into their next home. However, many lenders limit the duration of a rent-back to 60 days, and there are liability issues to consider before entering into an agreement. A contract and security deposit should be in place in case of any property damage or unexpected repairs that may be needed during the rent-back period.³
Tip #2: Open your mind to short-term housing options.
While it can be a hassle to move out of your old home before you’re ready to move into your new one, it’s a common scenario. If you’re lucky enough to have family or generous friends who offer to take you in, that may be ideal. If not, you’ll need to find temporary housing. Check out furnished apartments, vacation rentals and month-to-month leases. If space is an issue, consider putting some of your furniture and possessions in storage.
You may even find that a short-term rental arrangement can offer you an opportunity to get to know your new neighborhood better—and lead to a more informed decision about your upcoming purchase.
Tip #3: Embrace the idea of selling now and buying later.
Instead of stressing about timing your home sale and purchase perfectly, consider making a plan to focus on one at a time. Selling before you’re ready to buy your next home can offer a lot of advantages.
For one, you’ll have cash on hand from the sale of your current home. This will put you in a much better position when it comes to buying your next home. From budgeting to mortgage approval to submitting a competitive offer, cash is king. And by focusing on one step at a time, you can alleviate some of the pressure and uncertainty.
“WHAT IF I GET STUCK WITH TWO MORTGAGES AT THE SAME TIME?”
This is one of the most common concerns that we hear from buyers who are selling a home while shopping for a new one, and it’s realistic to expect at least some overlap in mortgages. To make sure you don't get into a situation where you are carrying dual mortgages for longer than you can afford, examine your budget and calculate the maximum number of months you can afford to pay both.?
If you simply can’t afford to carry both mortgages at once, then selling before you buy may be your best option. (See Tip #3 above.) But if you have some flexibility in your budget, it is possible to manage both a home sale and purchase simultaneously. Here are some steps you can take to help streamline the process:
Tip #4: As you get ready to sell, simplify.
You can condense your sales timeline if you only focus on the home renovations and tasks that matter most for selling your home quickly. For example, clean and declutter all of your common areas, refresh your outdoor paint and curb appeal, and fix any outstanding maintenance issues as quickly as possible.
But don't drain unnecessary time and money into pricey renovations and major home projects that could quickly bog you down for an unpredictable amount of time. We can advise you on the repairs and upgrades that are worth your time and investment.
Tip #5: Prep your paperwork.
You'll also save valuable time by filing as much paperwork as possible early in the process. For example, if you know you'll need a mortgage to buy your next home, get pre-approved right away so that you can shorten the amount of time it takes to process your loan.
Similarly, set your home sale up for a fast and smooth transition by pulling together any relevant documentation about your current home, including appliance warranties, renovation permits, and repair records. That way, you're ready to provide quick answers to buyers' questions should they arise.
Tip #6: Ask us about other contingencies that can be included in your contracts.
Part of our job as agents is to negotiate on your behalf and help you win favorable terms. For example, it’s possible to add a contingency to your purchase offer that lets you cancel the contract if you haven't sold your previous home.
This tactic could backfire, though, if you're competing with other buyers. We can discuss the pros and cons of these types of tactics and what’s realistic given the current market dynamics.
“WHAT IF I MESS UP MY TIMING OR BURN OUT FROM ALL THE STRESS?”
When you're in the pressure cooker of a home sale or have been shopping for a home for a while in a competitive market, it's easy to get carried away by stress and emotions. To make sure you're in the right headspace for your homebuying and selling journey, take the time to slow down, breathe and delegate as much as possible. In addition:
Tip #7: Relax and accept that compromise is inevitable
Rather than worry about getting every detail right with your housing search and home sale, trust that things will work out eventually––even if it doesn't look like your Plan A or even your Plan B or Plan C. Perfecting every detail with your home decor or timing your home sale perfectly isn't necessary for a successful home sale and compromise will almost always be necessary. Luckily, if you've got a good team of professionals, you can relax knowing that others have your back and are monitoring the details behind the scenes.
Tip #8: Don't worry too much if your path is straying from convention
Remember that rules-of-thumb and home-buying trends are just that: they are estimates, not facts. So if your home search or sale isn't going exactly like your neighbor’s, it doesn't mean that you are doomed to fail.
It's possible, for example, that seasonality trends may affect sales in your neighborhood. So a delayed sale in the summer or fall could affect your journey––but not necessarily. According to the National Association of Realtors, the housing market tends to be more competitive during the summer and less competitive during the winter.? But it's not a hard and fast rule, and every real estate transaction is different. That's why it's important to talk to a local agent about your specific situation.
Tip #9: Enlist help early.
Which leads us to our final tip: If possible, call us early in the process. We'll not only provide you with key guidance on what you should do ahead of time to prepare your current home for sale, we'll also help you narrow down your list of must-haves and wants for your next one. That way, you'll be prepared to act quickly and confidently when it’s time to list your house or make an offer on a new one.
It's our job to guide you and advocate on your behalf. So don't be afraid to lean on us throughout the process. We’re here to ease your burden and make your move as seamless and stress-free as possible.
BOTTOMLINE: COLLABORATE WITH A REAL ESTATE PROFESSIONAL TO GET TAILORED ADVICE THAT WORKS FOR YOU
Buying and selling a home at the same time is challenging. But it doesn't have to be a nightmare, and it can even be fun. The key is to educate yourself about the market and prepare yourself for multiple scenarios. One of the best and easiest ways to do so is to partner with a knowledgeable and trustworthy agent.
A good agent will not only help you evaluate your situation, we will also provide you with honest and individually tailored advice that addresses your unique needs and challenges. Depending on your circumstances, now may be a great time to sell your home and buy a new one. But a thorough assessment may instead show you that you're better off pausing your search for a while longer.
Contact us for a free consultation so that we can help you review your options and decide the best way forward.
Posted On: August 6th, 2021 5:46PM
5 Factors That Reveal Where The Real Estate Market Is Really Headed
It’s the old supply-and-demand predicament: Home sales in the U.S. continue at a red-hot pace, but the availability of listings remains limited. Stimulated by historically low mortgage rates, buyers keep shopping for homes, reducing the available inventory and sparking a rise in home prices across the country.
News website The Atlantic summarized the sizzling home market this way:
“Pick a housing statistic at random, and it’s probably setting an all-time record. Home prices: record high. Inventory: record low. Percentage of homes selling above asking price: record high. Average time on market: record low.”¹
Meanwhile, homebuilders are contending with an increase in material costs and a shortage of labor. These issues come amid an ongoing shortage of housing. A study commissioned by the National Association of Realtors found the U.S. is coping with a deficit of about 2 million single-family homes and about 3.5 million other housing units.²
So what can we expect from U.S. real estate? Here are five factors that illustrate where the housing market is today and is likely heading tomorrow.
ROCK-BOTTOM MORTGAGE RATES TO GRADUALLY RISE
Low interest rates continue to fuel demand from homebuyers. Some experts believe mortgage rates will creep up later this year, but they expect rates to remain near historic lows.3 However, the Federal Reserve signaled in mid-June that it may institute two interest rate hikes as soon as 2023, which could then trigger a more substantial uptick in mortgage rates.4
In June, the Mortgage Bankers Association reported that 2020 closed with the average rate for a 30-year, fixed-rate mortgage sitting at 2.8%. But the association anticipates the average rate climbing to 3.5% at the end of 2021 and 4.2% by the end of 2022.5
“As the economy progresses and inflation remains elevated, we expect that rates will continue to gradually rise in the second half of the year,” said Sam Khater, chief economist at Freddie Mac.6
What does it mean for you?
You’ve likely heard the old saying about “striking while the iron is hot.” Well, that phrase applies to the current environment for mortgage rates. It’s impossible to predict with certainty when mortgage rates will rise or fall. So, when mortgage rates are at or near historic lows (as they are today), you should seriously consider taking advantage of those rates to borrow money for a home purchase or to refinance your existing mortgage.
HOME PRICES EXPECTED TO KEEP CLIMBING
Low mortgage rates are sparking interest among homebuyers, but some are running into affordability issues.
In June, the national median list price for a home reached an all-time high of $385,000, up 12.7% on a year-over-year basis.7 And according to the Home Buying Institute, various reports and forecasts indicate home prices will keep climbing throughout 2021 and into 2022.8
While this may be welcome news for homeowners, high prices are pushing homeownership out of reach for a growing number of first-time buyers. In a recent CoreLogic survey, 82% of respondents listed housing affordability as a key problem.9
“Younger and first-time buyers, including younger millennials, are faced with the challenge of having sufficient savings for a down payment, closing costs and cash reserves,” said Frank Martell, President and CEO of CoreLogic. “As we look to the balance of 2021, we expect price rises to continue which could very well push prospective buyers out of the market in many areas and slow home price growth over the next year.”9
What does it mean for you?
If you’re a buyer waiting on the sidelines for prices to drop, you may want to reconsider. While the pace of appreciation should taper off, home prices are expected to continue climbing. And rising mortgage rates will only make a home purchase more expensive.
SINGLE-FAMILY HOME SALES REMAIN ROBUST
While record-high prices are sidelining some buyers, the impressive pace of single-family home sales marches on.
Single-family home sales are down from their peak in October 2020 yet are still above the overall level last year. In May 2021, 5.8 million existing single-family homes were sold in the U.S. That’s a 45% increase over the 4 million homes sold in May 2020.10
However, home sales saw a 0.9% dip in May 2021 compared with the previous month, the National Association of Realtors says. That was the fourth straight month for a decline in home sales. The number of home sales has slid recently because of rising prices coupled with a shortage of available homes amid intense demand.10
Fannie Mae expects total home sales to tick up slightly in the fourth quarter and finish the year up 3.8% over last year. They also forecast a slight decline of 2.2% in sales volume in 2022.11
What does it mean for you?
The market for single-family home sales remains quite active. As a result, if you’re a homeowner, you may want to ponder whether to sell now, even if you hadn’t necessarily been thinking about doing so. With demand high and inventory low, your home could fetch an eye-popping price.
LACK OF INVENTORY STILL CONSTRAINS THE HOME MARKET
According to the National Association of Realtors, in May there were 1.23 million previously owned homes on the market, down 20.6% from the same time last year.10 This translates to a 2.5-month supply of homes, which is well below the 6 months of inventory typically seen in a balanced market.10,12
According to the Realtors group, this lack of inventory translates into tougher searches for buyers and contributes to a rise in prices.10
“Demand for bigger and more expensive accommodations amid the COVID-19 pandemic, which has left millions of Americans still working from home, is driving a housing market boom. The inventory of previously owned homes is near record lows,” according to Reuters.13
What does it mean for you?
If you’re thinking of selling your home, now may be the right time to do it. Across the country, it’s a seller’s market, meaning demand is outpacing supply. That supply-and-demand imbalance puts sellers in a great position to sell their homes at a premium price. The May 2021 Realtors Confidence Index from the National Association of Realtors found the average home that was sold attracted five offers, and the association says nearly half of homes are selling above list price.14,15
CONSTRUCTION OF SINGLE-FAMILY HOMES SEES SLIGHT UPTICK
Frustrated buyers may soon find some relief, however, from an increase in new construction. Economists forecast that 1.1 million new houses will be started in 2021, compared with a predicted 940,000 units just six months ago, with 1.2 million new starts predicted for 2022 and 2023, according to the Urban Land Institute.16
Amid the rise in home construction, builders are coping with rising costs for materials. In April, the National Association of Home Builders estimated that a surge in lumber prices over the previous year had led to $35,872 being tacked onto the cost of an average new single-family home.17
“Shortages of materials and labor have builders struggling to increase production of new homes, though the demand remains strong,” Robert Frick, corporate economist at Navy Federal Credit Union, told the Reuters news service. “Potential homebuyers should expect tight inventories and rising prices for both new and existing homes for the foreseeable future.”18
Builders (and buyers) did receive some good news in June, though: Lumber prices are coming down—although likely to remain above pre-pandemic levels for the foreseeable future.19
What does it mean for you?
Given the issues affecting the new-home market, it may make sense to widen your home search to include both new and existing homes. Your brand-new dream home may not be available, but you might be able to find an existing home that lives up to your vision. Keep in mind that we can help you find either a new or existing home and can advocate for you to ensure you get the best deal possible.
ARE YOU THINKING OF BUYING OR SELLING?
If you’re in the market for a home, you’re ready to sell your house or you’ve simply been wondering whether you should sell, you definitely could benefit from an expert to help you navigate the sizzling hot real estate market. Let’s set up a free consultation to discuss your situation. We can help you figure out your options and come up with a plan to capitalize on the value of your current property or to find your ideal next home.
Posted On: July 18th, 2021 11:43PM
If you’re searching for drama, don’t limit yourself to Netflix. Instead, tune in to the real estate market, where the competition among buyers has never been fiercer. And with homes selling for record highs,1 the appraisal process—historically a standard part of a home purchase—is receiving more attention than ever.
That’s because some sellers are finding out the hard way that a strong offer can fizzle quickly when an appraisal comes in below the contract price. Traditionally, the sale of a home is contingent on a satisfactory valuation. But in a rapidly appreciating market, it can be difficult for appraisals to keep pace with rising prices.
Thus, many sellers in today’s market favor buyers who are willing to guarantee their full offer price—even if the property appraises for less. For the buyer, that could require a financial leap of faith that the home is a solid investment. It also means they may need to come up with additional cash at closing to cover the gap.
Whether you’re a buyer or a seller, it’s never been more important to understand the appraisal process and how it can be impacted by a quickly appreciating and highly competitive housing market. It’s also crucial to work with a skilled real estate agent who can guide you to a successful closing without overpaying (if you’re a buyer) or overcompensating (if you’re a seller). Find out how appraisals work—and in some cases, don’t work—in today’s unique real estate environment.
An appraisal is an objective assessment of a property’s market value performed by an independent authorized appraiser. Mortgage lenders require an appraisal to lower their risk of loss in the event a buyer defaults on their loan. It provides assurance that the home’s value meets or exceeds the amount being lent for its purchase.
In most cases, a licensed appraiser will analyze the property’s condition and review the value of comparable properties that have recently sold.Mortgage borrowers are usually expected to pay the cost of an appraisal. These fees are often due upfront and non-refundable.2
Appraisal requirements can vary by lender and loan type, and in today’s market in-person appraisal waivers have become much more common. Analysis of the property, the local market, and the buyer’s qualifications will determine whether the appraisal will be waived. Not all properties or buyers will qualify, and not all mortgage lenders will utilize this system.3 If you’re applying for a mortgage, be sure to ask your lender about their specific terms.
If you’re a cash buyer, you may choose—but are not obligated—to order an appraisal.
APPRAISALS IN A RAPIDLY SHIFTING MARKET
An appraisal contingency is a standard inclusion in a home purchase offer. It enables the buyer to make the closing of the transaction dependent on a satisfactory appraisal wherein the value of the property is at or near the purchase price. This helps to reassure the buyer (and their lender) that they are paying fair market value for the home and allows them to cancel the contract if the appraisal is lower than expected.
Low appraisals are not common, but they are more likely to happen in a rapidly appreciating market, like the one we’re experiencing now.4 That’s because appraisers must use comparable sales (commonly referred to as comps) to determine a property’s value. These could include homes that went under contract weeks or even months ago. With home prices rising so quickly,5 today’s comps may be lagging behind the market’s current reality. Thus, the appraiser could be basing their assessment on stale data, resulting in a low valuation.
HOW ARE BUYERS AND SELLERS IMPACTED BY A LOW APPRAISAL?
When a property appraises for less than the contract price, you end up with an appraisal gap. In a more balanced market, that could be cause for a renegotiation. In today’s market, however, sellers often hold the upper hand.
That’s why some buyers are using the potential for an appraisal gap as a way to strengthen their bids. They’re proposing to take on some or all of the risk of a low appraisal by adding gap coverage or a contingency waiver to their offer.
Appraisal Gap Coverage
Buyers with some extra cash on hand may opt to add an appraisal gap coverage clause to their offer.It provides an added level of reassurance to the sellers that, in the event of a low appraisal, the buyer is willing and able to cover the gap up to a certain amount.6
For example, let’s say a home is listed for $200,000 and the buyers offer $220,000 with $10,000 in appraisal gap coverage. Now, let’s say the property appraises for $205,000. The new purchase price would be $215,000. The buyers would be responsible for paying $10,000 of that in cash directly to the seller because, in most cases, mortgage companies won’t include appraisal gap coverage in a home loan.6
Waiving The Appraisal Contingency
Some buyers with a higher risk tolerance—and the financial means—may be willing to waive the appraisal contingency altogether. However, this strategy isn’t for everyone and must be considered on a case-by-case basis.
It’s important to remember that waiving an appraisal contingency can leave a buyer vulnerable if the appraisal comes back much lower than the contract price. Without an appraisal contingency, a buyer will be obligated to cover the difference or be forced to walk away from the transaction and relinquish their earnest money deposit to the sellers.7
It’s vital that both buyers and sellers understand the benefits and risks involved with these and other competitive tactics that are becoming more commonplace in today’s market. I can help you chart the best course of action given your individual circumstances.
DON’T WAIVE YOUR RIGHT TO THE BEST REPRESENTATION
There’s never been a market quite like this one before. That’s why you need a master negotiator on your side who has the skills, instincts, and experience to get the deal done...no matter what surprises may pop up along the way. If you’re a buyer, I can help you compete in this unprecedented market—without getting steamrolled. And if you’re a seller, I know how to get top dollar for your home while minimizing hassle and stress. Contact me today to schedule a complimentary consultation.
Posted On: June 4th, 2021 4:34PM
Could Rising Home Prices Impact Your Net Worth?
Learn how to determine your current net worth and how an investment in real estate can help improve your bottom line.
Among its many impacts, COVID-19 has had a pronounced effect on the housing market. Low home inventory and high buyer demand have driven home prices to an all-time high.1 This has given an unexpected financial boost to many homeowners during a challenging time. However, for some renters, rising home prices are making dreams of homeownership feel further out of reach.
If you’re a homeowner, it’s important for you to understand how your home’s value contributes to your overall net worth. If you’re a renter, now is the time for you to figure out how homeownership fits into your short-term goals and your long-term financial future. An investment in real estate can help you grow your net worth, build wealth over time, and gain a foothold in the housing market to keep pace with rising prices.
What is net worth?
Net worth is the net balance of your total assets minus your total liabilities. Or, basically, it is what you own minus what you owe.2
Assets include the cash you have on hand in your checking and savings accounts, investment account balances, salable items like jewelry or a car and, of course, your home and any other real estate you own.
Liabilities include your total debt obligations like car loans, credit card debt, the amount you owe on your mortgage, and student loans. In addition, liabilities would include any other payment obligations you have, like outstanding bills and taxes.
How do I calculate my net worth?
To calculate your net worth, you’ll want to add up all of your assets and all of your liabilities. Then subtract your total liabilities from your total assets. The balance represents your current net worth.
Total Assets – Total Liabilities = Net Worth
Ready to calculate your net worth? Contact me to request a free assessment of your home’s current market value!
Keep in mind that your net worth is a snapshot of your financial position at a single point in time. Your assets and liabilities will fluctuate over both the short term and long term. For example, if you take out a loan to buy a car, you decrease your liability with each payment. Of course, the value of your asset (the car) will depreciate over time, as well. An asset that is invested in stocks or bonds can be even less predictable, as it’s subject to daily fluctuations in the market.
As a homeowner, you enjoy significant stability through your monthly real estate investment, also known as your home mortgage payment. While the actual value of your home can fluctuate depending on market conditions, your mortgage payment will decrease your liability each month. And unlike a vehicle purchase, the value of your home is likely to appreciate over time, which can help to grow your net worth. Right now, your asset may be worth significantly more than it was this time last year.3
If you’re a homeowner, contact me for an estimate of your home’s market value so that you can factor it into your net worth calculation. If you’re not a current homeowner, let’s talk about how homes in our area have appreciated over the last several years. That way, you can get an idea of how a home purchase could positively affect your net worth.
How can real estate increase my net worth?
When you put your real estate dollars to work, it’s possible to grow your net worth, generate cash flow, and even fund your retirement. I can help you realize the possibilities and maximize the return on your investment.
Generally, property appreciates in one of two ways: either through changes to the overall market or through value-added modifications to the property itself.
This type of property appreciation is the one that many homeowners are enjoying right now. Buyer demand is at an all-time high due to a combination of record-low interest rates and limited housing inventory.4 At other times, rising home prices have been attributed to different factors. Certain local conditions—like a new commercial development, influx of jobs, or infrastructure project—can encourage rapid growth in a community or region and a corresponding rise in home values. Historically, home prices have been shown to experience an upward trend punctuated by intermittent booms and corrections.5
Well-planned and executed home improvements can also impact a home’s value and increase homeowner equity at the same time. The type of home improvement should be appropriate for the home and in tune with the desires of local buyers.
For example, a tasteful exterior remodel that is in keeping with the preferences of local home buyers is likely to add significant value to a home, while remodeling the home to look like the Taj Mahal or a favorite theme park attraction will not. A modern kitchen remodel tends to add value, while a kitchen remodel that is overly expensive or personalized may not provide an adequate return on investment.
You may be used to thinking of investments primarily in terms of stocks and bonds. However, the purchase of a real estate investment property offers the opportunity to increase your net worth both upon purchase and year after year through appreciation. In addition, rental payments can have a positive impact on your monthly income and cash flow. If you currently have significant equity in your home, let's talk about how you could put that equity to work by funding the purchase of an investment property.
A long-term rental property is one that is leased for an extended period and typically used as a primary residence by the renter. This type of real estate investment offers you the opportunity to generate consistent cash flow while building equity and appreciation.6
As an owner, you don’t usually have to worry about paying the utility bills or furnishing the property—both of which are typically covered by the tenant. Add to this the fact that traditional tenants translate into less time and effort spent on day-to-day property management, and long-term rentals are an attractive option for many investors.
Short-term rentals are often referred to as vacation rentals because they are primarily geared towards recreational travelers. And as more people start to feel comfortable traveling again, the short-term rental market is poised to become a more popular option than ever. In 2020 alone, in the thick of widespread travel bans, the short-term rental platform Airbnb’s market share of the hospitality industry reached as high as 41 percent.6
Investing in a short-term rental offers many benefits. If you purchase an investment property in a top tourist destination, you can expect steady demand from travelers while taking advantage of any non-rented periods to enjoy the home yourself. You can also adjust your rental price around peak demand to maximize your cash flow while building equity and long-term appreciation.
To reap these benefits, however, you’ll need to understand the local laws and regulations on short-term rentals. We can help you identify suitable markets with investment potential.
I AM HERE TO HELP
Ready to calculate your personal net worth? Contact me for an easy-to-use worksheet and to find out your home’s current value. And if you want to learn more about growing your net worth through real estate, we can schedule a free consultation to answer your questions and explore your options. Whether you’re hoping to maximize the value of your current home or invest in a new property, I am here to help you achieve your real estate goals.
The above references an opinion and is for informational purposes only. It is not intended to be financial advice. Consult the appropriate professionals for advice regarding your individual needs.
Posted On: May 5th, 2021 5:53PM
Imagine the first place you lived as a young adult. Now imagine trying to fit your life today into
that space. Not pretty, right?
For most of us, our housing needs are cyclical. 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
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. But no matter your age, there are some key factors
that you should consider as you enter into your first home purchase together.
Affordability is Key
There’s 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’s 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. In fact, that’s 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’s not until buyers reach their 40s
that the average size passes 2,000 square feet. Chosen carefully, a starter home can be a great investment as well as a launchpad for your lifetogether. 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.
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 don’t 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’s 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’ve 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’ll 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’ve 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. 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 localschools are actually like—and online ratings don't tell the whole story. That’s why talking to alocal real estate agent can be a gamechanger. We don’t just work in this community; we know itinside and out.
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.
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. But there’s plenty for empty nesters to think about besides square
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.
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’s face it—we can’t escape aging. If you’re 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’s 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 won’t, 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 very 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’re embarking on next, I am here to help. My insight into local
neighborhoods, prices, and housing stock will help you hone in on exactly where you want to
live and what kind of home is right for you. I’ve worked with home buyers in every stage of
life, so I know exactly what questions you need to ask. Buying a home—whether it’s your first
or your fifth—is a big decision, but I am here to support you every step of the way.
I support the Fair Housing Act and equal opportunity housing.
1. Freddie Mac -
2. PRB -
3. Experian -
4. Nerdwallet -
5. NAR 2020 Home Buyers and Sellers Generational Trends Report -
6. Investopedia -
7. NAR 2019 Moving With Kids
8. Kaiser Health News -
9. National Association of Realtors -