MINNEAPOLIS, MINNESOTA - 08-07-2017 (Press Release Jet) --
Millennials and baby boomers alike are choosing efficient homes and bigger life experiences
From baby boomers to millennials, Americans are increasingly choosing smaller properties in walkable neighborhoods over the big suburban home. Both generations are choosing to spend less time and money on their home so they can also invest in more life experiences.
According to data released by Nielsen, 37 percent of Baby Boomers said they plan to move at some point, and 42 percent of those said they would prefer to live in a smaller home.
Sharlene Hensrud of the HomesMSP Team at RE/MAX Results says, “My experience has shown baby boomers are more willing to sacrifice space than quality. When they move they are often looking for thoughtful design and a location that fits the lifestyle they aspire to in the next stage of their lives. It is surprising how many say they want to downsize but ultimately end up buying bigger rather than smaller, just re-arranging the space and their lives in a new setting.”
Baby boomers who truly downsize are often seeking little or no mortgage, energy efficiency and savings in everything from taxes and utilities to lawn care and maintenance. They may also hope to reduce transportation costs by walking or using public transportation. These cost savings give them the freedom to travel to visit grandchildren, take cruises, do volunteer work in other parts of the world and spend winters in the sun.
Millennials also don’t want to be tied to a home. They may have witnessed family and friends who were hit hard by high mortgage rates and home equity losses during the economic downturn in 2008.
Rent has also risen, giving millennials another enticing reason to buy. The only problem is that home prices have also been rising. While this is great for downsizing baby boomers, it means that the housing affordability index is at its lowest point since 2008. This impacts the buying power of millennials who are buying their first home, and often results in both generations competing for the same smaller, more affordable properties.
Townhomes and condos have been popular alternatives to a traditional, single-family home for both the millennial and baby boomer generations. However, the biggest problem is that there is a shortage of these properties, and they are hard to find in their preferred locations. Those properties that are available in preferred locations tend to be expensive. This drives up prices into less affordable price ranges for the housing goals of these groups.
“People planning to buy should develop a housing plan for the next three, five, ten and 20 years so you buy smart with a vision to the future,” says Hensrud. “I shouldn’t tell you this because I am in the business of selling homes, but it costs you money every time you sell. Getting it right at the beginning can save you a lot of money and hassle in the long run. And of course, always keep in mind that despite the best of plans change can happen at any time. Always buy with resale in mind.”
Hensrud has a last piece of advice for baby boomers: “Now is the time to fulfill the dreams you have been saving for for all your life. Don’t let the fear of not getting it ‘right’ stop you from creating new life experiences. You can always hit ‘reset’ and try again if necessary. Who knows what wonders you may miss if you don’t give it a try?”
To find out more about HomeMSP, visit homesmsp.com.
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