Seniors aren’t the only homebuyers who want to downsize right now

Retirees' plans to downsize their homes could be challenging as more buyers seek smaller homes in the midst of inflation.

Downsizing from a larger to a smaller home is a common practice for older adults as they enter retirement, but those types of plans could now be challenged by issues stemming from inflation. In addition, seniors are no longer the only ones who are willing to consider downsizing, which could cause more issues in a competitive market.

The Plan Collection, a vendor of home architectural plans, recently released data that shows the demand for new home plans with smaller square footage increased in 2022. There are likely multiple factors driving this trend, including inflation, building costs and mortgage rates, all of which have increased year over year.

“Year over year, searches for house plans for homes ranging between 500–1,000 square feet are up 34%, and those 1,000–1,500 square feet gained 32%,” the Plan Collection said in a press release.

This aligns with recent data published by Bank of America that showed about 71% of prospective buyers are now willing to purchase a smaller home than they might have been before. This could cause the market to be more competitive for seniors who have downsizing goals in mind.

A “60 Minutes” news report, which aired in March 2022, offered insight into why younger homebuyers might be looking at smaller homes. Redfin Chief Economist Daryl Fairweather told “60 Minutes” that one major issue that is keeping millennials from buying homes is a lack of housing supply.

“We are not building enough housing for everybody who needs a place to live,” Fairweather said. “We built fewer homes in the 2010s than in any decade going back to the 1960s, and at the same time millennials are the biggest generation and they’re entering into home-buying age.”

Downsizing is often included in seniors’ retirement plans to account for family members leaving the home, the difficulties maintaining a larger home or mobility issues.

While reverse mortgage loans are typically reserved for seniors who remain within their residences, a smaller share of business is done through the Home Equity Conversion Mortgage (HECM) for Purchase (H4P) program, which allows an older borrower to purchase a new home with a reverse mortgage.

H4P has its defenders in the reverse mortgage industry, but recent data from the Federal Housing Administration (FHA)’s Annual Report to Congress detailed that H4P utilization was reduced, making up only 3.2% of all HECMs in FY 2022 from its 4.17% total in FY 2021.

Learn more.

Related Links

• How Clutter Affects Your Mind

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

• Mortgage rates have peaked along with inflation

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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How Clutter Affects Your Mind

Clutter in our homes, offices and cars is something many of us are drowning in — but clearing it out can seem like a gargantuan task.

This article originally appeared in Axios Finish Line, a nightly newsletter on life, leadership and wellness. Sign up here.

• Why it matters: A messy environment infects the mind. It can make us anxious and hurt our ability to relax, focus or sleep.

"It just makes life harder," says Susan Whitbourne, a psychologist at UMass Amherst. "Things take longer to do, you lose things, you break things, you're slowed down."

• Then there's the emotional distress. "You're constantly faced with reminders of your messiness, which doesn't conform to your identity as someone who has their act together."

• Case in point: A recent study — reported in the journal Environment and Behavior tested — the effect of mess on behavior by placing subjects in normal versus chaotic kitchens. Those in the messy kitchens tended to overindulge in less healthy snacks like cookies more than their counterparts.

The solution is seemingly simple. Clear out the clutter and clean up the mess.

• But the very anxiety the mess is causing can make it difficult to face it and clean up, Whitbourne says.

Here are a few tips, culled from experts, on how to get started if you're staring down a stress-inducing mess:

1. Don't set an unreasonable goal. If an entire room has gotten cluttered, you might tell yourself you want to clean it in one go. But you likely won't be able to — and that'll stress you out even more, Whitbourne says.

2. Instead, make small changes in small doses. Start with one side of a closet or one cabinet in the kitchen. You'll accomplish your goal, and that'll be fuel to keep going.

3. Ask for help. When our spaces get messy, we often want to keep people out. But if you've got a friend or family member willing to help without judgment, let 'em.

4. Reward yourself! Whitbourne suggests putting on your favorite album or podcast while you clean and organize.

Get more like this on Axios.

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If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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These Are the 8 Spots in Your Home Where You Never Thought to Hang Art

When you think of styling art in your home, it’s easy to get stuck in the conventional gallery wall mindset.

Don’t get me wrong: A gallery wall never goes out of style, and when done right, they truly reflect the personality their owners. Other configurations and places to style wall art around your home exist though, and even better, some of them don’t even require walls (!) and are extremely renter-friendly. Let’s take a look at some inspiration for out-of-the-box art hanging, because if there’s something that almost every home could use, it’s probably more art!

In the center of a window frame

Take a good look at the windows in your home. Some of them might have a great view — a garden, a terrace, a skyline — but other might not really be showcasing anything special. The latter scenario is when styling art in a window can really be fun and rewarding, as shown in this Charleston bungalow above. The key is to not obstruct a window that has a great view or brings in a lot of natural light.

Below a window

A general rule for hanging wall art is to place pieces at eye-level, which is about 57 inches from the floor. Like any other design “rule,” you can bend those parameters a bit for decorative impact, especially when your walls have windows that are unconventional in shape and size. Take advantage of forgotten real estate below a window, just as this Parisian apartment dweller did. The eye will be drawn to this unexpected area once they’ve found a fun piece of art residing there.

Above a doorway

Hanging art above a doorway creates a neat perspective trick that can make your room appear a little bit taller. Here, a colorful print gets its own museum spotlight, thanks to the rays that come in through a skylight. Even if you don’t have the kind of architecture this Toronto renter has, art above a doorway can still make an impact by drawing the eye upward.

Around the whole doorway

To help delineate spaces in a more open concept home, try hanging art around the perimeter of a doorway. If your home has a few doorless passages, you can emphasize the transition from one room into an other by hanging interesting pieces that will make guests stop, look, and linger as they move through space, as is the case in this Louisiana home. Keep the art similar in size — not necessarily shape — to make this look intentional.

On top of other art

An alternative approach to the gallery wall, layered art — or overlapping pieces and hanging some art effectively on top of other art — looks and feels cozy and creative. To nail this look, use smaller frames over larger ones, as this New Orleans dweller did, so you can still see most of the works that you’re hanging smaller pieces over.

On a Mirror

As a kid, I remember going over to my grandmother’s house for family dinners and sitting at a dining room table staring back at myself awkwardly as I chewed the Sunday roast. She had a floor-to-ceiling mirrored dining room, a design choice that was popular in the ’70s. You can still find them in homes today, but before you rip them out (or if you’re renting and you can’t), try hanging art over a mirrored wall. You’ll reap the benefits of the mirror’s room-expanding effect, and you still get to admire a beautiful piece of art. That’s what I’d call a win-win.

On closet doors

Any closet door could benefit from some styling, right? That’s why I love the idea of treating a closet like it’s an extension of a wall, as this Philadelphia renter did here with photos and a mini shelf. Just make sure your art is securely fastened so it doesn’t jostle with opening and closing.

On a refrigerator

Meet the distinguished older cousin of the “magnets on the fridge” phenomenon: framed art on the fridge, first spotted in this Philadelphia rental. Accessorizing a kitchen can be tough, but one single piece of art, or a small triptych of three small little prints in this unexpected spot makes a kitchen’s decor feel intentional but not overpowering. Choose art that pulls together your kitchen colors, and mount it using strong peel-and-stick magnets.

Check out Apartment Therapy for more tips like these.

Related Links

• 2023 Home and Design Trends to Watch

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

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If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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Wood vs. Gas Fireplaces: Pros and Cons of Each

Whether you're in the market for a fireplace or are just looking to upgrade your existing one, it's important to consider all your options.

Two of the most popular choices are wood and gas fireplaces—but which is right for you? Let's explore the differences between wood and gas fireplaces to help you make an informed decision. 

Ease of Use 
One obvious difference between wood and gas fireplaces is ease of use. Gas fireplaces are much easier to light than their wood-burning counterparts; all it takes is the push of a button or flip of a switch, and you have instant heat. On the other hand, lighting a wood-burning fireplace requires more effort—you must gather kindling, create a proper airflow and make sure that the logs remain lit. If you're looking for convenience, then gas is certainly the way to go. 

Maintenance Considerations 
Gas fireplaces require much less maintenance than traditional wood-burning ones; there's no need to constantly clean up ash or chop wood. However, gas fireplaces do require occasional maintenance such as cleaning out creosote buildup in the chimney or inspecting pipes for any potential problems. For those who don't want to deal with regular upkeep efforts, a gas fireplace may be the better choice.

Installation
When it comes to installation, gas fireplaces are typically easier to install than wood-burning versions. Gas insert installation requires less manual labor, as they don't need to be built up from the ground or have a chimney installed. But if you don't already have gas lines in your home, then you'll need to hire an expert who can install the necessary pipes and venting to make sure your gas fireplace is safe. On the other hand, wood-burning fireplaces require more manual labor and usually need a chimney for proper ventilation. So if you're looking for an easier installation process, consider opting for a gas fireplace instead of a wood-burning one.

Environmental Impact
When comparing wood and gas fireplaces, it's important to consider which option is better for our environment. The EPA has deemed that both types can produce hazardous air pollutants when used incorrectly; however, some studies suggest that properly venting a natural gas appliance could reduce certain pollutants by approximately 70%. If preserving our environment is important to you, then investing in a quality venting system might be worth considering if you decide on a natural gas fireplace. 

Making an informed decision about what type of fireplace to install can seem overwhelming—especially when considering all factors like cost, convenience, maintenance needs and environmental impact—but this comparison should provide some helpful insight into whether a wood or gas fireplace would be best suited for your home. Ultimately it comes down to personal preference; weigh your options carefully before making your final decision! Whatever option you choose will bring warmth and beauty into your home while providing hours of cozy enjoyment during chilly days and nights!

Keep reading here.

Related Links

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If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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Mortgage rates have peaked along with inflation

The CPI data cooled even though shelter inflation is lagging

Today’s inflation data has shown that the peak growth rate of inflation is behind us. This should also mean mortgage rates hit their highs. The key phrase I have stressed since I wrote about the case for mortgage rates to go lower on Oct. 27 is thinking 12 months out. The trend is your friend, and the month-to-month data has cooled off noticeably.

That cooling happened even with the biggest inflation component — shelter inflation — still rising in the lagged modeled CPI data. This means shelter inflation isn’t being properly accounted for versus the real-time data.

The Consumer Price Index month-to-month readings show that inflation has peaked, as seen below.

If it weren’t for the lagging CPI shelter index, the biggest component, the headline core print, would be lower today on a year-over-year basis. It’s a positive thing that most people have gotten the memo on this reality about shelter inflation because it shows how the headline year-over-year prints are lower as we speak.

While still hot, the year-over-year inflation growth rate is falling, see below. All this is happening with the labor market still very tight, which means the Fed doesn’t need to create a job-loss recession to bring inflation down. The best way to fight inflation is to add more supply, demand destruction is not the most effective way, and it will impact future production.

The jobless claims data on Thursday, as you can see below, was still solid and running at 205,000 for the headline, with a four-week moving average of 212,500.

For those who were saying we needed an unemployment rate above 6% to bring down inflation, you must feel sick to your stomach as that advice would have meant millions of Americans would have lost their job for no reason.

How did the bond market react to this inflation data? It was a mild day compared to what we saw back in November of 2022. However, as I am writing this, the 10-year yield is at 3.45%, which is the third time we are trying to lower this area.

This does mean mortgage rates should be getting better today. We are getting closer to a five-handle in mortgage rates and farther away from the 8%-10% mortgage rates people were talking about late last year when rates peaked at 7.37%.

Digging into the inflation data

From BLS: 
The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.1 percent in December on a seasonally adjusted basis, after increasing 0.1 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.5 percent before seasonal adjustment. The index for gasoline was by far the largest contributor to the monthly all items decrease, more than offsetting increases in shelter indexes. The food index increased 0.3 percent over the month with the food at home index rising 0.2 percent. The energy index decreased 4.5 percent over the month as the gasoline index declined; other major energy component indexes increased over the month.

Breaking down some of the internals is key to understanding the CPI data. Of course, the biggest component of inflation is housing. I stressed in late 2020 that shelter inflation was going to take off, but the opposite is the reality now. However, the CPI data lags badly here.

Thankfully, the Federal Reserve understood this and created its own index in December to account for the lag. Back in September, on CPI inflation day, I talked about how this would be a positive story in 2023. I said by January or February, it would be evident that the growth rate of shelter inflation was falling, and people have gotten the memo. I could not have asked for a better outcome than where we are today.

Read the full article on Housing Wire.

Related Links

• 2023 Home and Design Trends to Watch

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

• What Are Your Goals in the Housing Market This Year?

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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