The growing pool of aging Americans may cause ripple effects on the real estate market.
The current demographics of heads of households over the age of 65 jumped from 27 million to 31 million in 2017, according to the Harvard Joint Center for Housing Studies. The next younger generation, those between the ages of 50-64, grew at a smaller rate. But in the next couple of decades, the number of heads of households over 80 will be massive: They will be the fastest-growing sector and will occupy 34 percent of the market share by 2038.
Currently, older households number 35 million people either living alone or with a spouse or partner. About 40 percent of households over 65 consisted of just a single person. Once they reach the age of 80, more than 57 percent will live alone, according to the studies.
As more American families grow older, they may realize they have room to spare and can afford to downsize without compromise.
People are realizing that life is still good despite being without a little extra room. History tells us that smaller spaces are just a mindset. A smaller dwelling is living large, and when downsizing is done right, there are additional benefits.
To get ready for this change, families should consider their current living situation versus what it’ll look like in five, 10 or 15 years down the road. That extra space for the home office, or the kids’ bedrooms, may not be essential once retirement age is reached.
Smaller homes will also require individuals to maximize functionality.
Cleaning out and tidying up around the home is a good start. Donating unneeded belongings to a local charity, or holding a garage sale is a win-win. Some benefits include tax breaks, extra cash and most importantly, extra space in your new home.
Transitioning into a smaller space can also uncover less than obvious costs – and save you money.
Of course, you’ll be paying less on your mortgage, but you may also avoid HOA dues, bills for pending repairs and have a smaller electricity bill.
If you’re thinking about resetting your living situation for a smaller home, Element Mortgage is the local mortgage expert here in the Seattle/Renton/Tacoma areas.
We know that buying a home is personal. That’s why our service puts a focus on unlocking the human element in today’s digital world. We can work closely with you to plan out your next big move.