Never underestimate the power of grandchildren — especially when it comes to lifestyle and financial decisions. Recent data shows that many baby boomers are relocating further away from home than they used to so they can be closer to their grandbabies. Unfortunately, this means some are paying more money on new homes than they ordinarily would.
The median distance Americans moved in 2022 was 50 miles, according to the National Association of Realtors’ Profile of Home Buyers and Sellers.That’s a significant increase from the median distance of 15 miles between 2018 and 2021.
One-quarter of buyers traveled more than 470 miles to find their new home in 2022, the NAR said. Younger boomers born between 1955 and 1964 moved the longest distance at a median of 90 miles. Older boomers born from 1946 to 1954 moved a median of 50 miles. Millennials tended to stay the closest to previous homes, moving only 15 miles.
A big reason boomers are moving further away is to be closer to their kids and grandkids. Moving for friends and family is the top motivation for relocating, at 25% of those tracked by the NAR, Yahoo Finance reported. That was followed by retirement, at 12%.
“They’re chasing that grandbaby multiple states away, just to be down the street,” NAR deputy chief economist Jessica Lautz told Yahoo Finance.
A separate report from Realtor.com found that during the 2023 second quarter, 60.3% of house shoppers searched for listings outside of their metro areas. That represented an increase of 0.7% from the previous quarter and 4.1% from the previous year.
There’s nothing new about older Americans and retirees moving to be closer to family and grandchildren. The difference now is they are traveling much longer distances to do so because their offspring are moving further away from their hometowns.
With many younger Americans settling in expensive urban areas, their boomer parents might also find themselves moving into pricier communities than in the past. This could be a bad financial move if you stretch your housing budget too thin — especially now, with home prices still near historic highs. However, it might make sense if you can split certain costs with other family members, such as elder care or child care.
One thing boomers should do before moving is consider how the cost of living will impact their lifestyles. According to the Teachers Insurance and Annuity Association of America (TIAA), you might need to “tweak your spending habits” if you move someplace more expensive to be closer to grandkids.
“Do the math on what you’ve been spending on travel to visit your kids when they weren’t close, and if you’re saving on airfare or car mileage, consider investing that money for retirement,” the TIAA advised in a blog.
You should also consider whether you will want a big home for hosting family events. If that’s the case, you might have to spend more on a home than you would with a traditional post-retirement downsize.
For most house hunters, price is still the major factor in where they move, whether they want to be near family or are relocating for some other reason.
“Housing affordability isn’t likely to improve anytime soon,” Realtor.com economist Jiayi Xu said in a press release. “So, it’s not surprising to see that Americans are on the move and increasingly searching for homes in more affordable areas of the country where they can stretch their housing dollars further.”
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