The past several years have been filled with enough change and upheaval for several lifetimes and the best laid plans of both buyers and sellers have frequently fallen by the wayside. That’s why predicting the future in this market moment feels particularly difficult. Hi I’m Michele Irizarry, CEO and Broker of Shore Prime Properties. Over the past 20 years, we have seen all types of market conditions and while hindsight is always 20/20, there are some trends on the horizon and a few safe bets about the housing market for 2023. While we’ll no doubt see plenty of continuing changes, there are always opportunities to be had if you know where to look.
Home Sharing
For those who are footloose and fancy free, thanks to remote work, settling down in one place may not be in the cards. Home sharing options are becoming more popular with Pacaso leading the way in shared ownership of second and vacation homes. It’s an idea that’s been around for a while among digital nomads and renters and it allows people to move from one place to another without giving up the comforts of home or the advantages of home ownership.
Renting to Own
Renting to own sounds like an old-fashioned notion but some property technology companies are adding a more modern twist to the concept investment companies like Divvy Homes are making some of their inventory available as rent-to-own properties and then helping renters purchase those homes by setting aside a part of their rent payments as down payment funds. With record high home prices and affordability struggles in every major market, innovative solutions can help buyers put together a financial strategy that works for them. It’s not just convenient, it’s good for families who may have had their savings impacted by the economic challenges of the pandemic.
House Hacking
Real estate investment is exciting but not everyone has the means to finance a portfolio of homes. Enter house hacking. A popular shortcut to real estate investment designed for those who are willing to put a little more personal time and effort into achieving their investment goals. There are a variety of ways to house hack from purchasing a home and renting it out to roommates or on Airbnb, to buying a duplex, triplex or quad and living in one unit while renting out the others. Some house hackers buy a home with an accessory dwelling unit such as a garage, apartment or pool house and rent out the extra space or on occasion, rent out the larger space and live in the smaller one. Essentially house hacking involves using OPM – other people’s money to pay down the mortgage and then using the equity to buy another house and another after that. Houses can be hacked year after year until you’ve built up the portfolio that you want to manage long term.
The Return of the Downsized Home
With record high home prices, some older homeowners may be unable to resist the lore of selling their big family home at a premium and then buying a smaller home or simpler to maintain retirement condo. This could be especially tempting for people in pre-retirement whose careers were disrupted by the pandemic or for those who find themselves with insufficient income in retirement. In addition, the Great Relocation may mean that many families find themselves with less need for a large space to gather if the kids and grandkids are now living further away. Many retirees and pre-retirees may once again be thinking about downsizing.
Multi-Generational Living
On the other side of the equation, some extended families may have decided to blend their households. This offers a way of dealing with the challenge of affordability and allows older family members to retire in place. Making a home suitable for multi-generational living may mean making alterations to the home’s interior to improve accessibility, adding space on the main level, splitting up an open concept home into discreet spaces or adding a dedicated exterior entrance. Work together to ensure the changes that you’re making are agreeable for everyone and that everyone has input on the transition.
Fixer Uppers and Additions
During the buyer’s market of the late 2000s and early 2010s buyers came to expect that they would be able to demand turnkey homes in their neighborhoods of choice. They got used to having everything on their wish list including laundry lists of repairs following the home inspections. In most cases, those days are over and buyers may now need to put in some work to create their dream homes. From adding space to doing their own repairs and upgrades, buyers will find more to choose from in a low inventory market if they are willing to contribute some elbow grease. If you’re thinking about buying a fixer-upper in the Long Branch area, talk to a trusted Long Branch real estate professional to find a reliable contractor or reach out to a highly rated and well-reviewed gig worker on platforms like TaskRabbit.
Exceptional Outdoor Spaces
Outdoor spaces have been at a premium throughout the pandemic and there’s no sign of this slowing down. Whether you’re looking for a single family home with a big backyard or a balcony attached to a city condo, everyone wants a little spot for alfresco living. Spending more than two years indoors seems to have given everyone a new appreciation for wide open spaces, wherever they can be found.
If you’re thinking ahead to your next move, reach out to us here at Shore Prime Properties. We can offer guidance and insight to help you be best prepared. I’m Michele Irizarry, selling prime real estate at the Jersey Shore.
