How Long Do People Stay in Their First Home?
Most people think they will stay in their homes forever…or at least for a few decades. This is not surprising – home ownership is a major pillar of the American dream, and a huge expense to undertake. Not many people want to deal with going through the process a second time around anytime soon.
According to the National Association of Realtors, about 43% of home buyers assume that they will stay in their homes for at least 16 years. This percentage is much higher among older generations (over 50% of those ages 54-72), and lower among younger generations (only 24% of those ages 28 and under).
Shockingly, many people vastly overestimate how long they will spend in their first home. In fact, over 60% of homeowners under the age of 38 stayed in their home for less than 7 years! Why is this?
Moving Closer to Loved Ones
Interestingly, one of the top reasons why people sell their homes is so they can be closer to loved ones. Many young homeowners buy their first home based on a first job or a can’t miss opportunity – as adults become more stable and have more options, they may elect to move closer to friends and family.
Getting a Bigger House
Many new homeowners start small to save money – and quickly outgrow their first home! This is one of the top reasons why people sell so quickly. As people move in together, get married, and have children, they frequently upgrade to fit everyone under the same roof comfortably.
New Family Situation
Many people change their living situation to accommodate changes in their family. This might be a new child, a divorce, an elderly parent moving in, or even kids moving back home. Whatever the shift is, it may mean downsizing, relocating, or upsizing to handle the change.
Older generations were accustomed to staying at the same job in the same place for decades – around 40% of boomers stayed with one employer for over 20 years! For younger generations, this is simply not the case anymore. With the boom of remote working, telecommute, the gig economy, and the ability to effortlessly job search online – millennials are more prone to change jobs when the opportunity arises. Many times, this means moving closer to a new employment site, and selling that beloved first home in the process.
There are plenty of reasons why homeowners leave their home so soon after their first purchase – especially for young people. Despite the common expectation that a home purchase is forever, most buyers will end up leaving their homes within 5-10 years. Generally this is a good sign – houses tend to appreciate in value a bit every year, so selling within the first decade may give homeowners the chance to build wealth faster and get a home upgrade in the process!