A growing problem in real estate: Too many big houses

[Yo_Mama_Been_Loggin]

Large, high-end homes across the Sunbelt are sitting on the market, enduring deep price cuts to sell.

That is a far different picture than 15 years ago, when retirees were rushing to build elaborate, five or six-bedroom houses in warm climates, fueled in part by the easy credit of the real estate boom. Many baby boomers poured millions into these spacious homes, planning to live out their golden years in houses with all the bells and whistles.

Now, many boomers are discovering that these large, high-maintenance houses no longer fit their needs as they grow older, but younger people aren’t buying them.

Tastes—and access to credit—have shifted dramatically since the early 2000s. These days, buyers of all ages eschew the large, ornate houses built in those years in favor of smaller, more-modern looking alternatives, and prefer walkable areas to living miles from retail.

The problem is especially acute in areas with large clusters of retirees. In North Carolina’s Buncombe County, which draws retirees with its mild climate and Blue Ridge Mountain scenery, there are 34 homes priced over $2 million on the market, but only 16 sold in that price range in the past year, said Marilyn Wright, an agent at Premier Sotheby’s International Realty in Asheville.

https://www.msn.com/en-us/money/realestate/a-growing-problem-in-real-estate-too-many-big-houses/ar-BBV4HIc?li=BBnbfcN

[Ohiogal]

1. I always thought

retirees and empty nesters preferred downsizing over up-sizing.

[exboyfil]

2. It is crazy around here

I have seen several cases of going up. I think it is factoring grandkid visits?

I plan to become a renter once the pets are gone myself. Just had a plumber in yesterday. Need a new Heating and Air Conditioning system. Roofs 2/3rds towards replacement. Sidewalk and driveway repairs.

[shanti]

4. Roof and HVAC

The two most expensive items for a homeowner. I feel for you! Both of mine went out within 3 years of each other, basically wiping out my savings shortly after retiring. Just now catching up.

Are you planning on staying in the same area if you rent? Rents are often more than a mortgage.

[exboyfil]

6. Probably not

Will be here as long as the job continues. Would move in with my mom in Florida if I lose my job (she needs someone with her and is paying someone to stay with her now).

Long term I plan to rent near where ever my older daughter settles. She and her husband work at the same place as me now, but they are young and full of wonder lust.

You throw maintenance, property taxes, homeowners insurance, and extra utilities into the mix, I am not convinced that renting is that much more expensive than owning (and this is without accounting for the value of the residence). Of course you lose out on market gains and housing inflation will hurt over time. I plan to half the size of livable square footage when I rent.

[Kitchari]

3. People who bought big weren't planning ahead

One of my siblings proudly moved to a large, expensive house in his early 60s and now at age 70 he and his wife regret it. Too much to take care of, and the kids and grandkids don't visit as often as they anticipated

[spinbaby]

5. The golf course houses are the worst

I have a friend who is going to inherit a McMansion in a gated golf-course community. Getting rid of it is going to be an issue because no one wants these houses anymore and dues to the golf club are $20,000 a year.

[Retrograde]

7. I have some friends who are bucking the trend

or at least trying to: early 60s, looking for a house considerably larger (ideally, twice the size) as the one they're occupying now. And they're not the type who like to do maintenance. I just listen and nod.

[llmart]

10. I hear a lot of that in the sub where I live.

My next door neighbors bought a two-story with no downstairs bedroom. They were late 60's when they bought and within five years the wife could no longer do stairs very easily. The husband told me that they actually bought a bigger home when they retired (not too bright) thinking their grandchildren would visit, but they live far away and rarely visit. Our sub has one story homes (detached condos) and two story and it is mostly an older neighborhood. The two story homes are difficult to sell and the one story homes like mine are in great demand. Because it's a condo community we get our snow removal and lawn work done with our condo fees.

In my experience, many boomers live in denial about the aging process.

[haele]

8. Well, you can always rent out half the house as an Air BnB...

Or you can set up rooms - or commercial space - for rent.

I know one rather elderly couple who rents their eclectic McMansion out for film crews and specialty DJ parties. Luckily, it's not on an HOA development, so they can have 20 - 50 cars on a gravel lot out front without anyone complaining. HOAs are another issue with McMansions, they really screw potential "fixes" for problem property issues.

Problem would be managing tenents, but you can probably figure out a way to cut the mortgage payments down by renting space out.

Haele

[iscooterliberally]

9. I want to buy a small house, with wheels on it.

This way I can park the thing at my brother's place and live there rent free. I tried home ownership once. I didn't care for it at all. I just rent a small house now, but I want to drastically reduce my housing costs for when I retire. Otherwise, I will have no money at all.

[rayshow]

12. real estate

While 700 square meters is indeed absurd for any family, 150 square meters seems a bit limiting. There are reasonable use-cases for houses larger than that. A living room, a kitchen, three bedrooms and an office will be hard to eke out of that much space. We recently moved there from the city to 200 square meters house which fully meets our needs. Real estate in USA is quite affordable nowadays