January 16, 2023, 11:40 AM
For many people, buying a home is the biggest purchase they’ll ever make because it is both a financial and an emotional decision, said Kevin Bazazzadeh, real estate investor and founder of Brilliant Day Homes. Different ages and stages of life may bring different considerations when buying a house, from the location and the property size to your budget and financing options.
“Buyers need to look at the next five or ten years of their life and what they have hopes for and how a particular home will supplement that,” Melanie Dawkins, realtor with kwElite Real Estate.
Here, experts explore how buying a home is different at different ages.
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In Your 20s
Find a Location That Meets Your Needs
Younger buyers and those through their 40s need to think about what they want to be near when it comes to restaurants or entertainment and nightlife, Dawkins said. “Location is just as important as what’s inside their house and how it will serve their life.”
Build Wealth Through Real Estate
Andy Piedra, real estate broker with Veteran USAF, suggests that the 20s are an excellent time to learn how to leverage real estate as a wealth-building tool. “I think anyone who can swing it should own the home in which they live, but to buy it wisely. This isn’t MTV Cribs. If single, we like to teach buyers to purchase with the intent to turn the property into an asset, right away.”
The way to do this, he said, is by renting out the other rooms to colleagues, friends or anyone you’re willing to live with. “That rate they pay, in many cases, will cover most if not all the monthly costs of owning the home.”
For young families, it’s not as feasible to rent out rooms, Piedra said. But they can still buy with the intent to turn it into an asset eventually. “In some cases, if they go on vacations, they can rent the home out as a short term vacation rental. Or they may be able to convert a basement into a separate rentable space. Or, most logically, they buy now to enjoy the home and then when they move, they rent the home out for cash flow, which is very doable when factoring in rental rate increases over time and/or the ability to refinance the home for a lower payment down the road.”
Traditional Multifamily Homes
The traditional multifamily home or flexible spaces are great options for first-time homebuyers, said Ralph DiBugnara, president of Home Qualified and senior vice president at Cardinal Financial.
“[There are] plenty of program through FHA, Fannie & Freddie Mac offer that will continue to offer low down payment options as little as 3%. Also there are more down payment assistance programs or grants available than almost ever before. These approved programs can be found on agency websites such as Fanniemae.com or Freddiemac.com.”
Gen Z Wants Flexibility
In general, DiBugnara said, Gen Zers in a position to buy are looking for more creative approaches to homeownership. “Gen Z want flexible homes or places to live without long term commitments and the possibility to earn money. Gen Z has been one of the most active buyers and participants in the short term or Airbnb market. These types of residences afford them the flexibility to not have to live somewhere permanently but also enjoy the home while still earning on it.”
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In Your 30s and 40s
Think About Family
Younger buyers should take into consideration if they intend to have a family, or if they intend to work a lot and be gone, Dawkins said. “Maybe they don’t want to be in charge of mowing a lawn and a townhouse is more important.”
Young couples and newly-weds may be more interested in a starter home they can afford now and grow into over time, said Kevin Bazazzadeh, real estate investor and founder of Brilliant Day Homes. “Meanwhile, families with school-aged children may be looking for a home with more bedrooms, workspaces, and a larger yard. Some may even prefer a house with a pool and barbeque area to keep the kids entertained during the summer.” If you’re a young, first-time homebuyer, you should know a few things before you buy your first home, said Rinal Patel, a licensed realtor and co-founder of We Buy Philly Home. “For example, you’ll need to save up enough money for a down payment, and you’ll need to budget for monthly expenses like mortgage payments, property taxes, and homeowner’s insurance. Many people overlook the additional costs of homeownership, like maintenance and repairs, but these costs can add up over time. Make sure you’re prepared for all the homeownership expenses before you make your purchase.”
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In Your 50s and 60s
If you’re close to retirement, Patel said “You’ll want to think about how long you plan on staying in the home, and whether or not you’ll need to make any modifications to accommodate your needs as you age. Maybe you want to downsize to a smaller home that’s easier to take care of, or maybe you want to move to a home that’s closer to family or friends. Whatever your plans are, it’s important to consider your retirement plans when buying a home.”
Additionally, those nearing retirement may be looking for a retirement community or a home that suits their needs better, Bazazzadeh said. “So, downsizing or finding a home with features like single-level living or a first-floor master bedroom may be a priority. This way, the house is easier to maintain as well.”
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60s and Beyond
Dawkins said that generally people in their 60s and older are looking for something that has one level, as stairs can pose a safety hazard. “Older buyers need to look at things like how a bathroom may be modified if they need it or having a laundry room and their primary bedroom on the same floor so they don’t risk a fall down the stairs.”
Retired folks may also have more money available to buy a home than someone who is just starting their family, Patel said. “Someone who is retired may have been able to save up money over their working years, while someone who is just starting their family may not have had as much time or money to save up.”
For buyers in their 60s and older, Dawkins said that “If they can stay in their own home and maintain their lifestyle by being active, then that’s a great healthy move for them.”
Dawkins also said that older folks need to think about how much landscaping they can handle outside and if they cannot do it themselves, do they want the extra cost of hiring someone to maintain that for them.
Patel concludes, “At any age, buying a home is a big decision, and it’s essential to do your research before making a purchase. Talk to family and friends, consult with a real estate agent, and take your time to find the right home for you. With a bit of planning, you can find the perfect home for your needs, no matter what stage you are in life.”