Baby Boomers and Housing
I found a couple of very interesting articles on some news channels that may leave some perplexed.
The first article was on CNBC and it involved Baby Boomers and their housing needs for their retirement.
Being a "baby boomer" myself and having "retired" from my "hourly job", I found these articles very interesting.
The second article was actually an interview on Fox Business and leaves you to wonder, "what next?".
The CNBC article discussed a couple with a retired husband and the wife was apparently still working. They wanted to
leave the home they raised their children in and move to a place with less maintenance.
The obvious choice was a Condo. They seemed extremely pleased with their move.
In the story, they discussed the numbers of baby boomers and how many will be hitting retirement until 2030. The
youngest of the baby boomers will turn 50 this year. Even more interesting, 10,000 per day will turn 65 between now
No wonder there are so many concerns about Medicaid and Social Security.
So, these seniors are trading down to a smaller home with less maintenance. The law of supply and demand might
lead some to think that there should be a really large supply of homes on the market for the next 15 years or so.
Now for the Fox Business interview.
You may, or may not, be aware of the fact that there are new rules affecting the Mortgage Loan Industry.
These rules were established to help protect the people purchasing homes and the investors in the various loan
instutions. After all, we are currently where we are, because of the lending practices of the past.
To summarize the interview, it would seem that Rick Sharga of Auction.com believes the new rules could impede
future mortgage activity.
There are actually several new rules, but the one discussed most was the 43% debt to income rule.
Why is this a concern?
There are actually a couple of considerations. First would be the entrepreneurs may not be able to "satisfactorily"
show the type of "regular" income to support the 43% rule. Secondly, the higher priced properties may take many
people out of the market for the same reason.
So, what do you do?
The above information all would suggest three important steps to be taken.
1 Before you go to see your first home, see your banker and get a pre authorization of a loan amount for which you
2. Secondly, once you have your banks commitment and you are comfortable with their approval, "Charge".
3. Do your "due dilligence" and find your new home while the mortgage rates are great.
I would not recommend that you NOT let a little bit of news like the above stop you in the pursuit of your dream