How Long to Keep First Home

How Long to Keep First Home

New homebuyers often tell their agents that they are looking for their “starter home.” Several factors go into this approach. These are typically younger buyers, often without children. They may be looking for a maintenance-free home, like a condo, or they might assume that starter homes are more budget-friendly. There are plenty of good reasons to buy a home with the assumption that it’s only for a few years, but it’s usually wise to consider the fact that it might be for much longer.

As 2020 demonstrated so clearly, things can change without warning. Homebuyers choosing a small condo with the intention of living in it for only a few years might later find themselves trying to carve out space for children due to employment challenges or market changes. The good news is that many times— once you add in association fees, taxes, and other costs—an older home that needs updating could be just as economical as a brand-new condo with all the latest design features.

When buying your first home, it’s important to consider how you would manage if you needed to stay longer than expected. An older home might offer a yard where you could expand, or extra rooms which can become bedrooms. These options can give you flexibility as your lifestyle changes over the years.

If you buy your first home with the future in mind, you can protect yourself from the unexpected income changes, real estate price booms, or any other outside influence. Don’t discount the older fixer-upper simply because you plan to move in a few years—plans change, and giving this some prior thought can help you adjust more painlessly in the future.

Things to Consider before Buying a Home Together

Things to Consider before Buying a Home Together

It used to be that couples first got married, and then bought a home together. No more! Modern couples no longer consider marriage a prerequisite for buying a home together. Buying a property together can complicate either a breakup or a divorce if not considered upfront.

No one likes to think about the end of a relationship, but buying a home is a huge investment – not only in the relationship but financially. The partners may have differences in income, down payment, and contributions to the home. In the event of a separation, how will these issues be addressed? In other words, what happens if you break up?

The easiest way to ensure that everyone is protected is the title. Most married couples opt for Joint Tenancy that provides each homeowner an equal interest in the value of the property. The assumption is that marriage involves a merging of income and assets.

For couples who plan to keep their finances separate, a better option could be a Tenancy in Common. This form of title provides each owner with a separate, transferrable interest in the property. The interest does not need to be equal to the other; this could give one a larger interest if they contribute more financially. The interest can also be sold or inherited separately.

Don’t let the excitement of a home purchase keep you from considering the future. Before closing on that dream home together, consider the exit strategy – just in case.