How long do I plan to live in my future home?
This may be the single most important question for you to answer. Why? Because the answer directly affects the size and type of home that you buy, where it’s located, as well as the type of mortgage you use to finance your purchase.
Times have changed since our parents bought their homes. Chances are, unless they’ve retired or are in professions where thy are required to relocate to different parts of the country from time to time, you parents are still living in the home in which you grew up.
Statistics from the National Association of Realtors (NAR, which your Realtor should be a member of), reveal that today, on average, people live in their homes only about 5 to 7 years. That’s it. Then, they move.
How are you supposed to know how long you’re going to live in your home? I suppose there is no way to know for sure, but here are some general guidelines, which can be referred to as the Cycle of Life.
Cycle of Life:
Young and single: If you buy a home here and you’re interested in having a long term relationship or getting married, it’s likely that what you can afford as a single person won’t be quite enough space for two. Within five to seven years you’ll probably trade your one bedroom or two bedroom home for something larger. Tip: look for a property that is an investment and in a neighborhood that is seeing appreciation. Ask your Realtor to help you locate a property that you may be able to turn into cash flow 5-7 years down the road
Newly Married: You may want to start a family within a few years of your marriage. Within 5-7 years, you’ll need additional space as your family starts to grow (and their stuff multiplies exponentially).
Divorced or Separated: This can be another move. At this point, in your second or third home, with young children in school, you’ll probably settle down for a while. You may even find a house in a good school district and decide to stay for 10-15 years, until your children are through with school.
Empty Nesters: Once your children are grown and out of the house for good, you might decide to sell your big house, take your profits (up to $250,000 for qualified single homeowners and up to $500,000 for married homeowners, tax-free) and move to a smaller condo somewhere warm or perhaps cold, if you like skiing.
Vacation Home: And finally, it’s possible that you’ll purchase a second (or third) home, to which you may actually end up retiring. The most popular age to buy a second home is 55-65, followed by 45-55, followed by 65-75, which mean the baby boomers are just beginning to enter their prime second home buying years.
Look Before You Leap
Before you start to look for a home, think about where you are in the Cycle of Life, and where you’ll be in five to seven years.
- Is marriage, a life partnership, or living with someone else a possibility within five to seven years?
- How many children do you plan to have during the next five to seven years:
- Are your children near or at school age? Have you chosen the school district you want for them?
- Is it likely you’ll be transferred for your job within the next five to seven years?
- Do you have an aging parent in another part of the country who may require your close supervision or attention?
- Do you have an aging parent or post-college-age children who might be moving back home with you? Will you need flexible living space that your current home can’t provide?
If you are thinking of buying a home, download my app (click on link OR download via QR code below) and pull all active, pending and sold listings in your neighborhood or desired neighborhood. If you find a house you like, I am right at your fingertips and am happy to assist you!