For better or worse, the face of home ownership is changing. Decades ago, people married in their early 20s, bought their own houses, and worked at the same job for 30 years. But life is very different today. Young adults, middle-age adults, and seniors are choosing to live together longer, and this pattern is only expected to grow. This concept leads to the question about how intergenerational living trends impact the home mortgage industry – and whether or not home loan providers are making the best use of these trends.
Why Intergenerational Living has Become More Common
A variety of factors have made intergenerational living more common and more accepted in today’s society.
- • Millennials are choosing to obtain a higher education, which means they often postpone home ownership.
- • People are less likely to keep one job for their entire careers. Frequent job changes, whether by choice or layoff, make home ownership less appealing at first. The dream of home ownership is still very real, but people are making the choice to become more financially solid before opening that door.
- • Thanks to medical advancements, people are living longer, but still may need companionship and assistance from their children and grandchildren.
- • While the cost of living continues to increase, income doesn’t always keep up with the pace. Intergenerational living means expenses – including the mortgage payment – can be shared.
- • A greater number of responsible individuals will be available to take care of babies, toddlers, and young children while other adults are away at work or school.
- • Household chores can be split, taking some of the responsibility off the shoulders of each resident of the house.
These are only some of the issues that have led to this trend toward multigenerational households. Each family can benefit from this trend in its own ways, but financial factors are almost always at the top of the list.
How Intergenerational Living Trends Impact the Home Mortgage Industry
While one of the greatest benefits of intergenerational living is the ability to share the mortgage payment with other adults, mortgage loan providers should make sure their mortgage technology addresses these trends. Mortgage loan providers who remain up-to-date with trends and technology will be in a better position to grow their client base and surpass the competition.
Whether multigenerational families are having new homes constructed with ideal living spaces or buying an existing multifamily home, they might decide to name multiple people as owners of the home. This will change multiple factors within the loan documents.
Loan officers may also want to consider the possibility that one or more individuals in the home will take a different route after the mortgage is finalized, leaving the others to deal with the full mortgage payment. In this case, mortgage bankers might have to work with the family to see what options would best meet their needs.
Regardless of the challenges, updating mortgage technology systems will help loan officers fully accommodate this trend, which provides many more benefits than potential downfalls. When it comes to how intergenerational living trends impact the home mortgage industry, the better equipped you are with the right technology, the better off you will be.