Homeownership is a Dominant Gene

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There are many things that factor into the decision to buy a home. New research from the Urban Institute suggests that one of those things may be inherited from your parents.

Children are More Likely to Own a Home if Their Parents Did

According to an analysis of millennial homeowners, the homeownership rate of those whose parents rent their homes is 14.4%, while the rate amongst millennials whose parents are homeowners is 31.7%!

“A young adult’s odds of homeownership are highly correlated with their parent’s homeownership.

Without controlling for such factors as age, income, education, marital status, and race or ethnicity, there is a 17 percentage-point gap between the homeownership rate for young adults whose parents are renters and young adults whose parents are homeowners.”

The study also revealed that as a parent’s net worth increases, so does the likelihood that their child will own a home. These two findings are not surprising as we know from the Survey of Consumer Finances that a homeowner’s net worth is 44x greater than that of a renter.

So, a parent who is a homeowner will have more wealth which will, in turn, increase the chances that their children will own their own homes in the future.

Below is a breakdown of the relationship between a parent’s wealth and a millennial’s likelihood to own a home.

Homeownership is a Dominant Gene | MyKCM

The Good News: The high homeownership rate amongst baby boomers (likely the parents of many millennials) is a great sign that millennials will want to own homes. We are already seeing this in the high-demand environment that we are currently experiencing in the starter and trade-up markets.

Bottom Line

Even though millennials took longer than many of the generations before them to start home searches of their own, the data shows that they will not be waiting much longer!

Granny Pods: Caring for Aging Relatives in Your Own Backyard

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Editor’s Note: This post was originally published on March 2, 2016. Housecall continues to share this piece due to ongoing requests and reader interest.

Caring for aging parents is a growing concern for many Americans. For those among the Sandwich Generation, homeowners typically in their forties who are responsible for their own families and their aging parents, what to do with grandma or grandpa is always a trying, stressful question to answer. While nursing homes may feel wrong or unnecessary, and having the elderly family member move into your family’s home may have its own inherent difficulties, the Granny Pod is here to finally provide a nice middle ground option for families in need.

Granny Pods, aka MedCottages, are 12 x 24-foot pre-fabricated pods that sit conveniently in one’s backyard. The structures hook up to existing plumbing and electrical systems and allow both the caregiver and senior citizen to have their own space while still being available and connected. The pods are quickly growing in popularity and are a win-win for both parties: the aging family member has his or her own space, while the caregiver doesn’t have far to travel to assist family members in case of an emergency.

The mobile homes are built with safety in mind and include many of the basic amenities any adult would need. They include a small kitchen, a bedroom and a bathroom all designed in a small scale space with easy access in mind. The bathrooms are handicap accessible with railings and safety features, while the floors are padded to help lighten the load on joints.

Not only are they safe, but they’re tech-savvy, too! Granny Pods can incorporate webcams for family members to monitor from afar. Even more impressive, robotic features can monitor vital signs, with alert systems armed to notify caregivers should a problem arise. The air can be monitored for contaminants and reminders can be sent to the inhabitant to remind them to take pills or supplements accordingly.

The MedCottages encapsulate all the functions of a proper nursing home, while providing grandma or grandpa with the freedom and privacy they may still desire.

For more information, visit the MedCottage Facebook page.

So what do you think – would you purchase a Granny Pod for an aging relative? Tell us your thoughts!

Courtesy of: Blog.rismedia.com

 

Rent or Buy: Either Way You’re Paying A Mortgage!

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There are some people who have not purchased homes because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize, however, that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

With home prices rising, many renters are concerned about their house-buying power. Mark Fleming, Chief Economist at First American, explained:

Over the last three years, renter house-buying power has increased fast enough to keep pace with house price appreciation, so the share of homes that a renter can afford to buy has remained the same since 2015.

Although mortgage rates are expected to rise, they are still low by historic standards, and real household incomes are the highest they have ever been. Assuming this trend continues, our measure of affordability, which takes into account income, interest rates, and house prices, indicates that homeownership is still within reach for renters.”

As an owner, your mortgage payment is a form of ‘forced savings’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person building that equity.

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.51% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.