Do you want to upsize? You're not alone
The pandemic has many homeowners and renters reevaluating what type of housing they need.
This is especially true for parents who work from home and families with children who are just starting out with distance learning.
A larger house with office space, study rooms, and lots of soundproof walls probably sounds ideal.
Of course, moving during COVID doesn't make sense for everyone.
But the good news is that low mortgage rates make upsizing affordable for many.
Here are some things you should know before making your decision.
Review your eligibility to buy a home (September 2, 2020).
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How COVID changed the "dream home"
Felix Homes CEO Tyler Forte says he has seen many homeowners lately looking for something to improve upon.
"Based on our daily work with home buyers and sellers, we have found that approximately 17% of all buyers are currently moving because they are looking for a larger home that is more conducive to studying or working from home," he says.
Forte notes that these buyers are prioritizing properties that have an office, attic, or other space that is convenient for children to participate in online learning.
"We have also seen many homeowners choose to stay in place but convert spare bedrooms into offices," adds Forte.
"Some even go so far as to renovate their homes to build a space that they can use for work or school."
>> Relatives: The 6 Best Home Improvement Loans
Aside from additional study space, many families find that they simply need more breathing space in their homes.
“Very few parents bought their home to meet the demands of the COVID-19 lifestyle. The house, which may have been empty for eight to twelve hours a day, is now in operation around the clock, ”says real estate agent and real estate attorney Bruce Ailion.
"For many families, not only are children trying to study at home, but one or both parents may also share the space," he continues. This can burden parents and children alike.
Check your new plan (September 2, 2020)
Benefits of moving immediately
Moving around during the pandemic may seem particularly stressful. And there are sure to be sticky parts of the process (as with any movement).
But moving now also has unique advantages.
Treat yourself to a bigger house with cheaper property taxes
Kimball Lewis, CEO of EmpoweringParents.com, recently bought a bigger house.
“It was crucial to have a private home office away from the hustle and bustle of the household. And since we teach our children at home, it was also important to have a central workspace for the children that wasn't their bedroom, ”he says.
“We bought a bigger house than we would otherwise have for precisely these reasons. And we could easily afford the bigger house because we moved to a nearby town with much lower property taxes. "
“We could easily afford the bigger house because we moved to a nearby town with much lower property taxes” – Kimball Lewis, CEO of EmpoweringParents.com
Lewis points out that parents planning on homeschooling their children and working from home anyway can save tens of thousands of dollars living a little further out of town and in an area with lower property taxes.
“Property taxes basically pay for the school system. So if you don't send your children to public school because you've decided to homeschool them yourself, you don't have to pay a premium, ”says Lewis.
Flexible work arrangements enable the move
This strategy now makes sense for many who would not have considered it a few months ago thanks to new flexibility in the workplace.
Ethan Taub, CEO of Loany, says parents with flexible work arrangements are ideal candidates for moving to distance learning.
"The best people for this strategy would be those who either work from home on a regular basis or run their own business that gives them the freedom to work at times that suit them best," explains Taub.
"What I am Not Hear from buyers today, "Ailion adds," is that they want to move to be closer to work. "
Low mortgage rates increase the purchasing power of homes
Several experts believe that anyone could be a good prospect for this strategy.
"With today's low interest rates, everyone is a candidate for improving their living conditions," says Ailion.
"That could mean moving to a better school district with more desirable distance learning systems, or getting a bigger house or yard."
Forte says he sees this trend mostly among parents who currently live in a more urban setting but want to move to the suburbs or a rural part of the city.
Find Out How Much House You Can Afford (Sep 2, 2020)
What do I need to consider before moving?
There is always a lot to consider before making a decision to move – especially if you need to get your current home on the market.
"Buying another home with a larger area doesn't necessarily mean you will get what you need," warns Daniel Beer, CEO / founder of the Beer Home team at eXp Realty, Inc.
“Parents need to focus on the functionality and layout of their next home. Think about the number of children you have, the number of bedrooms and home offices you will need, and the type of space you want your children to study at home. "
Parents also need to evaluate what they will do with the extra storage space once coronavirus is no longer a concern. Will the bigger house make sense in the long run?
Parents also need to evaluate what they will do with the extra space if the coronavirus is not a concern and their children are returning to an all-school.
Wonder, will the bigger house make sense in the long run? Is It A Smart Investment?
"This doesn't have to be a problem if you want to use the extra space for something else later – for example a bonus room or a hobby room," suggests Forte.
Another factor is job stability and the economic situation.
“We continue to see millions lose their jobs and have to look for other jobs. What might work now may not work a few months later, ”says Taub.
Balance the prospect of a new, larger mortgage against your expected job stability. If there is a likelihood that you will be laid off or your work time reduced in the near future, a new mortgage may not make sense.
Tips for Buying a Home During a Pandemic
Also, develop careful strategies for:
Bring your home to market while you shop for another – "Don't expect fast movement. The pandemic has created a nervous atmosphere among people looking to buy a home, so the time it takes to sell your existing home may be slower than you think," says TaubFind the best type of mortgage loan – “Working with a good mortgage broker is the ideal situation here,” adds Taub. You might want one FHA home loanwhich has a low down payment requirement. If you are planning to move to a rural / suburban area, take a closer look at a No Money Down USDA Loanswhich requires that you sell your current home in order to be eligibleMake sure you have access to the right amenities – Including proximity to community services, medical care and utilities. “Strong WiFi is the key. If you study or work from home, you need robust internet and a good WiFi location. Find out whether this is available where you want to move, ”recommends Taub
For more information on buying, selling, and moving during the COVID pandemic, check out this guide on COVID and your mortgage.
Find an affordable mortgage
Buying a home in the middle of this pandemic has a huge benefit.
Mortgage rates are still near all lows. That means homebuyers can afford bigger homes – with smaller monthly budgets – than ever before.
The amount you qualify for depends on your down payment, your balance, and your new mortgage rate.
So if your goal is to increase size, check out a few lenders to find out who can offer you the lowest price and the biggest budget for home buying.
Check your new plan (September 2, 2020)