In many real estate markets, younger buyers are now competing with older buyers for the same types of homes. Understanding the market forces at work and adjusting your priorities to find a home that’s slightly removed from the most desired pool of homes can open up valuable opportunities for military buyers.
The Boomer generation, generally thought of as those born before 1964, are now over 55 and are looking toward retirement or even a second retirement if they’re veterans who embarked on a post-military career. Their children have grown and gone and they’re likely to be grandparents. The types of homes they wanted in the 1980s and ’90s are now too large, too much maintenance, and too isolated for this active and social community with disposable income. This group is moving back into revitalized downtowns with walkable access to restaurants, shops, and the arts. They also look toward the days when they may not be as healthy or mobile, so being close to public transportation and the ability to access healthcare easily is a priority. And while they have disposable income, they’re certainly conscious of their life span outlasting their savings, so they often seek to keep their budget in check.
Millennials, generally adults under 40, are the largest home-buying block in the country. They’re getting settled in life and managing student debt, and they are fully entrenched in the civilian or military workforce. This group is transitioning from renting homes or living on base to buying homes. They’re after the same type of home the Boomers seek, and for many of the same reasons, particularly budget and amenities. Millennials are also motivated by some factors that are different from those of Baby Boomers. Millennials have grown up with environmental concerns about sprawl, more access to safe and clean public transportation, and the technology to support a socially engaged and active lifestyle. Downtowns, no matter the size of the city, provide easier access to all of those things.
Tips for Competing
While military families rarely have a choice of duty station and many rural posts are isolated from the forces at work here, plenty of active service members and veterans do land in competitive markets like these. So, when you do, how can you compete?
- Look for homes outside of the hottest area. The peripheral locations in the town may not have all of the amenities you want, but in an expanding and improving town, they’re likely to envelop the “next best” areas soon enough.
- Consider other ways to use a property and make it more affordable. Is there a duplex for sale? You could live in one side and rent out the other for income. Many people don’t know the VA Loan works in this situation also! How about subletting a portion of a home to a student or listing it on a vacation rental website? That extra income can offset the mortgage increase.
- Choose a second-tier town. Often, large cities have the most well-known and desirable downtowns, but their suburbs have grown to the size of small cities themselves, with their own restaurant and arts districts, their own transportation networks, and their own hot, but certainly less hot, markets.
- Maybe the suburbs aren’t so bad after all. If you’ve been living a busy life, maybe take a break for a few years in a spacious home with a cost per square foot that’s much less than a hot, city townhome. Plant a garden, invite friends over for parties in your big backyard, and swing in your hammock for a while.
No matter what generation you belong to, know there are opportunities in real estate that will fit your budget and your needs. Working with a real estate agent will help you get the inside scoop on those opportunities.