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An interesting
homeownership cycle begins with a starter home and progresses to larger and
smaller homes throughout a person's lifetime. Within a few years after
purchasing their initial home, they might move up to a little larger
house. The reasons could be that they simply want a larger home and can
afford it, or their increased family size may be motivating the move.
While the
children are small, they can probably get by with less space but as they grow
and behave more like adults, even though they may not be, the need for more
room becomes more pressing. Depending on the size of the family, this
will last some time and then, as they go off to college, enter the work force
and find their own living space, the parents may find that they no longer
need the larger home.
In the interest
of saving money or possibly convenience, they migrate from a larger home to a
smaller home until they consider an assisted living facility or possibly, a
nursing home. Another alternative, many homeowners are electing is to
move in with their children or other family members. Some homeowners
are even retro-fitting their homes with equipment and safety devices that will
allow them to continue to live in their homes in old age.
According to the
American Community Survey, a person in the United States can expect to move
11.7 times in their lifetime. When that person is 18 years old, they
can expect to move another 9.1 times and by age 45, they can expect another
2.7 moves in their lifetime.
One of the
suspected reasons affecting the low housing inventory in America at this time
is the group of homeowners who would move but are reluctant because the home
will sell and with the shortage of homes, they may not be able to replace it
with what they want.
The fact that
builders have not kept up with the demand in the past twenty years has been a
major contributor to the low inventory that housing is currently
experiencing. It is estimated that it will take two million new homes a
year for the next decade to get caught up, assuming demand doesn't increase.
There are also
other factors involved like the fact that since 2007, the owner's tenure in
their home has more than doubled from five years to 10.6 years. People
are staying in their homes longer which means the homes are not coming on the
market for sale.
Another
consideration is that sellers with extremely low mortgage rates are reluctant
to buy another house which would have to be financed at a higher rate than
they are currently paying.
Regardless of
where you are in the homeownership cycle, we can provide important
information and experience that is essential to making a smooth move.
Having the facts reduces the risk of unexpected outcomes.
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