Navigating the Changing Real Estate Market: Are Older Homes Still a Wise Investment?

You may have noticed that some older, classic homes in many neighborhoods are lingering on the market longer than before. These homes often have solid structures and charming details, but they may not fully meet the needs of today's families. With recent shifts in county budgets and new tax considerations, buyers are becoming more selective. They want more than just a nice kitchen; they seek homes that offer flexibility, potential income, or comfortable multi-generational living.

This post explores the current trends affecting older homes, what buyers are looking for, and how changes in zoning laws might reshape the value of these properties. We'll also look at how older homeowners' selling patterns influence the market and what this means for anyone considering buying or selling a classic home.

Older home with spacious backyard and mature trees

Why Older Homes Are Staying on the Market Longer

Older homes often have great "bones"—solid construction, unique architectural details, and established neighborhoods. Yet, many lack the updates or additional living spaces that modern buyers want. Features like walk-out basements, large backyards, or flexible rooms are becoming more important.

Buyers today are not just looking for a move-in-ready home; they want a property that can adapt to their changing needs. This might mean space for a home office, a separate unit for a family member, or the potential to generate rental income. Homes without these features often require price adjustments to attract buyers.

The Impact of New Zoning Rules on Older Homes

A key development to watch is the upcoming county zoning hearing on June 9th. The county is considering allowing accessory dwelling units (ADUs) to be built up to 75% of the main home's size. This change could dramatically increase the value of older homes with large lots.

If approved, homeowners could add substantial living space or rental units, making these properties more attractive to buyers. For example, a classic home with a deep backyard could be converted into a multi-unit property, providing income or housing for an extended family. This potential flexibility is turning some older homes into hidden gems.

What Buyers Want: Flexibility Over Finish

The market is shifting from a focus on "move-in ready" to "future-ready." Buyers want homes that can evolve with their needs. This means:

• Spaces that can serve multiple purposes (office, guest room, rental unit)

• Outdoor areas that support expansion or recreation

• Features that support aging in place or multi-generational living

  
  

Flexibility is becoming the new luxury. A home that can adapt to different lifestyles or generate income is more valuable than one that looks updated.

Older Homeowners and the Price Gap

Older homeowners, especially those aged 70 and above, hold a significant portion of the country's housing wealth—about $13 trillion, or one in every four dollars of housing value. Research from the Federal Reserve Bank of Philadelphia shows that older sellers tend to receive lower prices than younger sellers.

One reason is that older homeowners often invest less in renovations and maintenance. Deferred upkeep and disrepair can reduce a home's market value. The study found that about 25% of the price difference between older and younger sellers is due to this factor.

For example, an 80-year-old seller might get 5% less than a 45-year-old selling a similar home. This gap highlights the importance of upkeep and updates in maintaining home value, especially for older sellers.

Practical Tips for Buyers Considering Older Homes

If you're thinking about buying an older home, keep these points in mind:

• Assess the potential for updates and expansion. Look for homes with large lots or flexible spaces that could be adapted.

• Consider the cost of renovations. Older homes may need work to meet modern standards or personal needs.

• Watch local zoning changes. New rules on ADUs or expansions can add value.

• Think about long-term use. Will the home support your family's future needs or provide rental income?

• Inspect carefully for deferred maintenance. Older homes may have hidden issues that affect price and livability.

  
  

Advice for Older Homeowners Selling Their Homes

If you are an older homeowner planning to sell, these strategies can help maximize your home's value:

• Invest in key updates. Even small renovations can boost appeal and price.

• Address maintenance issues promptly. Fixing deferred repairs prevents price reductions.

• Highlight potential for ADUs or expansions. Buyers value flexibility.

• Work with a knowledgeable agent. They can help price your home competitively and market its strengths.

• Consider timing. Watch for zoning changes or market shifts that could increase demand.

  
  

Homes are no longer places to live; they are assets that need to work for their owners. The real estate market is evolving, and older homes must adapt to stay competitive. Buyers want properties that offer more than charm—they want flexibility, potential income, and space for changing lifestyles.

If you know someone considering purchasing or selling real estate, allow me to serve as a resource to connect you with a top agent in the community. Appreciate consideration.