Smart Moves

For months, Daren Blomquist and his wife have hankered to buy a much bigger house in the same middle-income suburb where they now reside. The couple’s two young daughters are tired of sharing a bedroom. Plus, the family recently acquired a boisterous golden retriever.

But the couple’s quest to replace their 1,800-square-foot Spanish-style property with a larger one in the same school district has been frustrating. New listings are rare in their neck of the woods, and when a property they liked came on the market recently, it was pulled back by the sellers before Blomquist and his wife could make a bid.

“The owners said they’re waiting until spring 2019. By waiting, they think they’ll get a lot more money,” says Blomquist, a senior vice president at Attom Data Solutions (attomdata.com), which tracks real estate markets throughout the country.

Blomquist understands the sellers’ reasoning for wanting to delay. After all, home prices have risen in his area, as well as many popular neighborhoods, for more than six years.

Even so, he questions whether it’s wise for the sellers to wait.

“There’s no reason for gloom and doom. But at this point, the headwinds are against home price appreciation. Mortgage rates are going up, which is triggering a cooling off period for buyers,” Blomquist says.

Mary Gillach, a real estate broker who’s sold homes since 2001, says another factor slowing the market is the fatigue many would-be purchasers are experiencing at this point in the cycle, especially in inventory-tight communities.

“People who’ve lost homes to other bidders feel demoralized,” she says.

Lawrence Yun, chief economist for the National Association of Realtors (realtor.org), says low inventory levels are now starting to contribute to a gradual housing market slowdown.

“Price gains are going to decelerate,” he says.

Here are a few pointers for sellers:

-- Lower your expectations for major price jumps.

Sid Davis, a real estate broker and author of “A Survival Guide to Selling a Home,” says that even in some exceptionally strong real estate markets, demand has recently started to recede.

“For several years, buyers have faced stiff competition, especially at the starter-home level. Some people are just not comfortable with so much pressure,” Davis says.

All this is not to say that popular neighborhoods are bereft of wannabe purchasers. But smart sellers know that pricing right from the outset is always crucial to a successful sale.

“This isn’t the right time to be a greedy seller, if it ever was,” Davis says.

He says a listing agent who’s skilled in calculating the right price for a property is a valuable ally for sellers who want to hit the target when their home first goes up for sale.

“No matter the market, asking more than your home is really worth is a big mistake. Most buyers won’t even make an offer if they think you’re greedy,” Davis says.

-- Seek guidance from real estate pros in your immediate area.

When it comes time to sell a home, many owners think it’s wise to hire a trusted family member as their listing agent. But Davis cautions against choosing someone from your inner circle.

Even if your family member has a proven track record in real estate, choosing that individual as your agent could be a mistake.

“Your relatives probably won’t tell you if your place is a dump that needs to be decluttered or that it’s worth a lot less than you think,” Davis says.

He recommends you interview three agents who work in your area to determine the right one to sell your house. Ask each to give you a candid evaluation of both the condition and current worth of your place. Also question all three on how they came up with their pricing recommendations.

“You want to see the actual comparable sales used to support their recommendations. In a changing market, it’s especially important that these sales be very recent, preferably for houses sold within the last month,” Davis says.

-- Review the agent’s track record on pricing.

Are you planning to sell a home in an area where property values are now flat or slipping slightly? In that case, it’s unlikely you’ll receive your full asking price at the closing table. But if your property was marked correctly from the outset, you should still come quite close.

“The idea is to hit the bull’s-eye from the beginning rather than letting your house become shopworn,” Davis says.

How can you judge whether the agents you’re interviewing have a good track record on pricing? One way is to review a few key numbers on their past listings, such as “list-to-sale” statistics. Then compare the original asking price versus the sum ultimately received by the sellers.

If the agent is routinely making realistic recommendations, there should be little difference between the original list price and the final sale price.

“Don’t listen to any agent trying to flatter you into a ‘feel-good price’ that’s much higher than other pros are suggesting -- with the unspoken expectation of seeking a price cut later. That could lead to a very subpar sale,” Davis says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

Once retirees hit their late 60s, many start hearing a chorus of voices from friends and associates urging them to sell their big family house and downsize to a much smaller place, ideally close to their grown offspring.

But real estate specialists say there’s no one-size-fits-all for retirement happiness. What’s more, they say moving near family can be a big mistake for some seniors, especially if it means they must make a long-distance move away from close friends and acquaintances.

“Older people who live in a true community ... have lots to lose by leaving the old neighborhood. In the new area, they might feel alienated and isolated,” says Eric Tyson, a consumer advocate and co-author of “Personal Finance After 50 for Dummies.”

“Most of us are much more independent than interdependent. Our extended families aren’t the kind that spend every Sunday night together,” Tyson says.

Fred Meyer, a longtime real estate broker and appraiser, says seniors should weigh their options carefully before making any major move. That’s because late in life it’s tough to reverse a major housing mistake.

Here are a few pointers for retirees:

-- Consider your lifestyle preferences as primary factors.

Meyer urges retirees to focus primarily on settling in a place where they can pursue their strongest interests.

“Ask yourself what you really like to do and then find the best places to fulfill those passions,” Meyer says.

Because lifestyle factors are so important in retirement, he says many seniors are happier living in modest housing while pursuing their dreams than in fancier housing elsewhere. Fortunately, those with more common interests, such as golf or tennis, can fulfill these in a wide array of locations. But others, like theater buffs, need a more particular location to pursue their passions.

Though not yet retired, Meyer intends to do so one day in Cambridge, Massachusetts, where he heads a real estate firm near Harvard University. He chose that setting because the community is “manageably small and walkable” and allows him to audit classes at Harvard. It’s also close to Boston, where he often attends cultural events.

Merrill Ottwein, a former president of the National Association of Exclusive Buyer Agents (naeba.org), says advance planning is crucial when it comes to selecting a retirement destination.

“Assuming you’re in good health and aren’t compelled to consider assisted living, start thinking about where you’ll live at least two or three years before making the big move,” he says.

Here are a few pointers for retirees:

-- Do a reality check on your retirement finances.

“Cost considerations are a huge factor in retirement decisions,” Ottwein says.

Are you short on retirement savings and believe you’ll need to sell your current house to make ends meet in the future? In that case, Ottwein urges you to plot a strategy with a trusted financial adviser or accountant before making any sudden move.

As you finalize the financial plan for retirement, he recommends you give serious thought to the level of mortgage debt you’re willing to carry in retirement. For most people, a comfortable retirement means freedom from large house payments.

“As our parents and grandparents were well aware, it’s far from ideal to have a mortgage in retirement. Strip down all your living costs and you’ll feel a lot more financially at ease,” Ottwein says.

-- Don’t rule out remaining in the area where you now live.

Through his several decades selling real estate, Ottwein has helped many seniors sort through their housing options. Experience has taught him that most retirees do best when they live within a 30-minute drive of their former home.

He says that retiring to a distant location could be a particularly poor choice for those who’ve found meaning through volunteer work near the community where they’ve lived for many years.

“Obviously, you could find a new volunteer gig at your new domain. But will you already have established relationships there? Probably not,” Ottwein says.

-- Consider the potential downsides of living close to your grandkids.

As retirees, you may relish time with your offspring. But how would you feel if asked to take on the role of regular babysitter for young children?

“Even if your kids only count on you on an intermittent basis, that could make it hard for you to schedule travel or other enjoyable activities,” Ottwein says.

One problem of making a major commitment to care for the grandkids is that this could cost you time and energy that might otherwise go toward fulfilling your retirement plans -- like learning to sail or taking up the trombone.

Another risk, though uncommon, is that your grown children may be less than thrilled at having you nearby. To be certain they’re OK with the idea, Ottwein recommends you have a candid conversation with them before deciding to move nearby.

“Though people rarely say it out loud, it could be that you and the kids really don’t like spending that much time together. That’s not a crime, just a reality,” he says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

Millennials -- young adults born between the early 1980s and mid-1990s -- are famously urban. Give them a city apartment near trendy restaurants, pubs and a Pilates studio and they’ll be content for years, or so goes conventional wisdom.

But real estate analysts say something surprising happens to these young urbanites after they’ve had a child or two: They leave their city apartments and retreat to a suburban enclave in search of the same sort of classic detached house in which they were raised.

Skylar Olsen, a senior economist for Zillow, which tracks housing trends across the country, says recent data show that many millennials surrender their city lifestyles once they reproduce. As homebuyers, this generation is more like their parents than previously believed.

“Young buyers with kids want a detached home. They want a large living space and a three-car garage. But because of cost, townhouses are where many end up,” Olsen says.

Though many millennials eventually make the predictable transition from city to suburbs once they become parents, real estate specialists stress that suburban living is not for everyone, regardless of their life stage. They advise homebuyers to carefully ponder their housing moves before investing in any property.

Here are a few pointers for home-buying couples with kids:

-- Start by envisioning your ideal neighborhood.

Doro Kiley, a certified life coach who helps clients navigate major transitions, says that before starting a home search, families should first imagine their ideal neighborhood. That should help them get as close as possible to the optimal setting.

“Always begin by thinking about the end product -- what you’d really like as opposed to what you would settle for. In many ways, we create our own realities,” Kiley says.

Once you have a clear picture of your ideal neighborhood, begin factoring in such practical realities as your financial limits.

-- Next, imagine the ideal property.

Kiley says both partners should write down their respective visions of a dream house -- including home features. They should then share their visions, combining the key elements of both into a single statement.

Written statements help people clarify their thinking and refine their plans as they move through successive drafts. This is also a way to help reconcile conflicting views.

Merrill Ottwein, a real estate broker and former president of the National Association of Exclusive Buyer Agents (naeba.org), suggests prospective homebuyers try to reconcile their differences by distinguishing between “wants” and “needs.”

For instance, a couple with two young school-age children and one parent who needs a home office for telecommuting might decide that acquiring a place with at least four bedrooms is a genuine “need.” But a formal dining room could easily fall into their “want” category.

-- Factor commuting distances into your calculations.

As Ottwein says, one of the most wrenching trade-offs many families face is between a larger, newer house with a longer commute, and a smaller, older place that’s closer to the city center and the workplace of the primary breadwinner.

Buyers who consider an outer-tier suburb are often driven by the desire for a larger property or what they perceive to be better schools.

“Sadly, good schools often correlate with newer suburbs rather than older areas that are close in,” Ottwein says.

But before you opt for a distant suburb, he strongly recommends you do morning and afternoon rush hour test drives from your target area. This way, you’ll know more precisely what sort of traffic to expect should you live there.

As Ottwein says, buyers should disabuse themselves of the notion that the current level of traffic congestion on their path will remain static. The odds are traffic will worsen as the years go on.

-- Don’t assume you’ll need a huge yard to accommodate your children.

Many parents with young children hang on tightly to the hope that their kids will have as large a backyard as they had growing up. This aspiration can influence them to pick an outlying suburb at the expense of their convenience and commuting time.

But are the trade-offs necessary to acquire a large piece of land always worth it? Not in many cases, says Ottwein, noting that today's children often spend much more time in organized athletic and recreational activities than did their parents.

“Today’s kids are programmed to the hilt with team sports, music lessons and school events. They have little time for the sort of free backyard frolicking their folks remember so nostalgically,” he says.

There are only a few homebuyers whom Ottwein believes make as much use of their large lots as they intended when they bought their place.

“Mostly it’s just those few people who want horses -- or who are true isolationists -- who are justified in accepting all the sacrifices that come with a long commute,” he says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)