Retirement-age baby boomers have recently been shifting the tides of the real estate market in what’s become known as The Silver Tsunami. Increasingly interested in downsizing, empty nesters are selling their single-family homes and embracing the amenities that condos offer. Here are some core reasons behind this new trend that’s been sweeping across the country:

Age Plays a Major Role in Decision Making

Experts anticipate that more than 25% of owner-occupied homes will become available over the next two decades. The reason: the rising number of seniors, 60 or older, who will move into senior living facilities or pass away in the 2020s and 2030s. Many boomers are therefore thinking ahead, trading in their homes in pursuit of making the most out of their golden years. An added benefit: while enjoying the amenities and ease of condo life, baby boomers are also potentially leaving behind larger inheritances for their heirs.

The Benefits and Amenities of Condo Life 

These are hard to pass up. Most boomers are attracted to on-location condo amenities like gyms and pools, being free from maintenance hassles, as well as living in close proximity to neighborhood activities and restaurants. They see condo life as a positive alternative to senior living facilities, being able to remain amongst peers while also enjoying their golden years. 

Changes to Reverse Mortgage Rules

Condo life is not only socially enticing to boomers, but it’s also becoming more financially practical. Changes in reverse mortgage rules have opened up previously-ineligible condos to HECM protections. This financial flexibility, which older buyers have with reverse mortgages, is yet another alluring feature for boomers who are exploring the idea of condo life. 

Final Thoughts

It’s no surprise that with everything condo life has to offer, millennials, not baby boomers, were the largest demographic of single-family homebuyers in 2018. Of course there’s no right answer when choosing between a house or condo. We at Open Mortgage simply recommend that you make sure your new home suits your long-term needs and makes sense financially. 

So whether you’re a boomer or millennial, and whether you’re shopping for a condo or house, we at Open Mortgage are always available to assist with your home financing needs. Visit OpenMortgage.com for more information and to start talking to someone today.

Things to know about Reverse Mortgages:

  • At the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds
  • Charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees
  • The loan balance grows over time and interest is charged on the outstanding balance
  • The borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home
  • Interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full re-payment
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