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How Growing, Multi-Generational Families Impact Home Design And Financing

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How Growing, Multi-Generational Families Impact Home Design And FinancingThere has been a surge in families who have multiple generations living together. In many cultures, children take care of their parents as they age. This is done in an effort to repay the parents for raising them during their childhood.

At the same time, when there are multiple generations living together in the same home, there are some changes in both home design and financing.

Financing a Multi-Generation Home

Anyone who is looking to finance a multigeneration home will need to detail their financing plan to the mortgage lender. The lender always wants to know how the loan is going to be repaid. The more details someone can supply, the better the chances are that the application will be approved.

A common arrangement is having the grandparents supply the down-payment. They are more likely to have a ready supply of cash-on-hand, often in the home of equity from their prior home.

Then, parents typically supply monthly payments. They are more likely to a stable source of income given that they are likely still employed.

The Home Design of a Multi-Gen Home

Given that more and more people are indicating their willingness to live in a multi-gen home, this is having an impact on home design as well. Many of these homes have a first-floor bedroom. While these were unusual before, having first-floor bedrooms is important for older relatives. This allows them to avoid having to take the stairs, reducing the risk of falls.

In addition, many people want to provide their older relatives with a feeling of independence while living in the home. This can be accomplished by providing a small kitchenette in the first-floor bedroom. There is often a separate entrance as well. Some families are even interested in having a separate guest house on their property.

Investing in a Multi-Gen Home in the Future

As multiple generation housing arrangements continue to increase throughout society, the financing and home design will continue to evolve. For this reason, it is important for everyone considering this living arrangement to stay up to date on the trends in this industry. It might impact how they design and finance their home for their elderly family members in the future.

Talk with your trusted real estate and mortgage financing professionals to get the best advice on your personal situation. They are experienced in designing solutions for every possible scenario.

December 2019: The Buyer Stakes Are High Because Inventory Is Low

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December 2019: The Buyer Stakes Are High Because Inventory Is Low | MyKCM

The reality of what we’re seeing this month is that homes are selling fast. In today’s strong seller’s market, bidding wars are common and expected with starter or entry-level homes.

In most areas of the country, first-time buyers have been met with fierce competition throughout their homebuying experience. Some have been out-bid multiple times before finally going into contract on a home to call their own.

Right now, inventory is the big challenge. Here’s what we know today:

According to the latest Existing Home Sales Report from the National Association of Realtors (NAR), there is currently a 3.9-month supply of homes for sale, which can drive this kind of hefty buyer competition. Remember, anything less than 6 months of inventory is a seller’s market.

Even though the month’s supply of inventory is not increasing, ironically, the number of homes for sale is. This means homes are coming up for sale, but they’re being sold quickly. The graph below shows the year-over-year change in inventory over the last 12 months.December 2019: The Buyer Stakes Are High Because Inventory Is Low | MyKCMAs depicted above, the percentage of available inventory has fallen for four consecutive months when compared to the previous year.

So, what does this mean? If you’re a buyer, be sure to get pre-approved for a mortgage and be ready to make a competitive offer, so you can move quickly. Chances are, homes high on your wish list are likely going to go fast.

Bottom Line

If you’re thinking of buying a home, make sure you’re taking the right steps at the beginning of the process, so you’re a top contender if you ultimately find yourself in a bidding war. Let’s get together to discuss what you need to do to make your move toward homeownership.

What’s Ahead For Mortgage Rates This Week – December 16th, 2019

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What’s Ahead For Mortgage Rates This Week – December 16th, 2019Last week’s economic reports included readings on inflation and retail sales; the Federal Reserve released its post-meeting statement from its Federal Open Market Committee. Weekly readings on mortgage rates and new jobless claims were also released.

Inflation, Retail Sales Rate Dip in November

The Commerce Department’s Consumer Price Index dipped in November to a growth rate of 0.20 percent as compared to October’s growth rate of 0.40 percent. Analysts expected inflation to slow to 0.20 percent growth.

Year-over-year inflation rose to 2.10 percent, which was its highest reading in a year. Analysts said rising rents, energy and healthcare costs caused the higher consumer inflation reading. November’s Core Consumer Price Index was unchanged at 0.20 percent growth. The Core CPI reading excludes volatile food and energy sectors.

Retails sales growth slowed to 0.20 percent in November as compared to October’s growth rate of 0.40 percent and expected growth of 0.50 percent. Retail sales exclusive of autos were also lower in November with a reading of 0.10 percent growth.

Analysts expected a reading of 0.40 percent growth; October’s reading for Retail Sales Excluding Autos showed 0.30 percent growth. Lower retail sales at the start of the winter holiday shopping season could signify cooling consumer confidence in the economy.

Fed Holds Steady on Key Interest Rate Range

The Federal Open Market Committee of the Federal Reserve announced no change to the target federal funds rate range at its meeting on Wednesday. The target range for the federal funds rate remained at 1.50 to 1.75 percent.

The Committee’s post-meeting statement suggested that FOMC members did not plan to change the federal funds rate in 2020 if economic conditions remain stable, but said that monetary policy decisions were flexible and could change as global and domestic economic conditions require.

Mortgage Rates, New Jobless Claims Rise

Freddie Mac reported higher average rates for fixed-rate mortgages last week. The average rate for a 30-year fixed-rate mortgage was five basis points higher at 3.73 percent; rates for 15-year fixed-rate mortgages averaged five basis points higher at 3.19  percent.

The average rate for a 5/1 adjustable-rate mortgage was three basis points lower at 3.36 percent. Discount points rose across the board last week and averaged 0.70 percent for fixed-rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

New jobless claims jumped to 252,000 last week, which surpassed expectations of 220,000 new claims and the prior week’s reading of 203,000 first-time claims filed.

What’s Ahead

This week’s scheduled economic releases include the National Association of Home Builders’Housing Market Index and Commerce Department readings on housing starts and building permits issued. The National Association of Realtors® will release data on sales of pre-owned homes and weekly readings on mortgage rates and new jobless claims will also be released.

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