Real Estate Trends and Tips
Down with Down Payments: As home prices rise and banks compete for business, lenders are easing the standard 20% on loans for wealthy borrowers. In October 2013 Bank of America lowered its minimum down payment requirement to 15%, down from 20% for loans of up to $1 million. Wells Fargo followed suit by cutting the down payment requirements by the same amount for private jumbo mortgages, which start above $417,000 in most parts of the country and exceed $625,000 in pricier housing markets such as New York and San Francisco. Credit unions have also joined the trend. Most of the lenders say they are loosening the 20% requirement because a significant risk has subsided – rising home values suggest fewer borrowers will foreclose or walk away from their homes since they are appreciating assets.
Multi-Generational Homes: Family reunions are taking on a new meaning in the real estate market. An estimated 51.5 million people live in multi-generational housing, which typically means three generations under one roof. That number is expected to increase as baby boomers get older. At least 10,000 Americans will turn 65 each day for the next 19 years, according to the Pew Research Center.
Whether to take care of elderly parents or just to make ends meet for young couples and parents, more families are moving in together. Additionally, today’s seniors not keen on retirement housing. The new concept is to build a home within a home, a full home with a separate, private apartment attached to it. The idea was born out of a trend that took hold during the recession, where families doubled up to save on housing costs. Kids who had run out of money moved back into childhood homes, heads of families who had lost their homes to foreclosure moved in with siblings, or mom and dad settled in with their children’s families. While saving money is certainly an incentive for buying a home that accommodates multiple generations, the benefits go beyond just financial reasons. With two or three generations living under one roof, families often experience more flexible schedules, quality time with one another and can better juggle childcare and eldercare.
