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Since the calendar turned to 2024, the internet has been abuzz with trend reports and home decor predictions that offer a glimpse into what lies ahead in the world of interior design.

For many, these lists may seem overwhelming, especially if you’re not planning to embark on a full-scale renovation this year. But fret not; there are simpler ways to elevate your home by getting creative with a DIY project or two.

Below, we’ll introduce you to 7 home trends experts predict will be big in 2024 and the DIY projects that can help you breathe new life into your living spaces. 

DIY Projects That Will Elevate Your Home

Get your toolbox ready. From textured walls to living walls, home renovation experts predict these DIY projects are exactly what you need to elevate your home in 2024. 

1. Using reclaimed materials

(Image credit: Future/Paul Massey)

As more and more of us aspire to make eco-friendly home improvements in 2024, it’s no surprise that using reclaimed and recycled materials is gaining popularity among DIY enthusiasts.

Beyond their environmental benefits, reclaimed and salvaged materials bring a distinctive ‘well-loved’ quality that enriches interior designs with texture and depth. The weathered patina of reclaimed wood, for instance, can seamlessly enhance a home with a modern rustic style, while salvaged fireplaces and reclaimed bricks effortlessly complement modern farmhouse aesthetics. These materials possess a timeless charm, making them an ideal choice for elevating your home’s overall look.

If you’re seeking a quick and manageable DIY project that can be completed in an afternoon, consider exploring your local antique market for a set of vintage drawers and transform them into a unique plant display. Alternatively, give rustic scaffolding boards a fresh lease on life as distinctive kitchen shelves, or reimagine tin ceiling tiles as a one-of-a-kind kitchen backsplash.

For those willing to take on a slightly larger project, a salvaged barn door can be flipped into a statement headboard, and ordinary internal doors and windows can be replaced with antique shutters to achieve a truly bespoke finish.  

2. Adding texture to walls

(Image credit: ILIV Textiles )

While the memories of popcorn ceilings and orange peel walls might remind you of outdated interior design trends from yesteryears, wall texture is poised to make a stylish comeback in 2024.

Embrace the classic elegance of a knockdown finish or the rustic charm of limewash paint to infuse subtle drama into your walls. For a touch of warmth, consider decorative plasters like stucco or tadelakt. The beauty of these unique finishes is that they can be applied to your walls through a DIY approach using a trowel or roller, making it a cost-effective way to enhance your home’s ambiance.

And remember, texture doesn’t have to be just tactile. There are plenty of ways to introduce visual texture to your walls. Leading industry names like Benjamin Moore are bringing color-washed walls back into the spotlight this year, and even famous figures like Blake Lively are embracing this trend in their own homes.

3. Biophilic home improvements

(Image credit: Future)

‘In 2024, biophilic design and creating healthier living spaces are poised to be prominent trends,’ predicts Christine Marvin, Vice President of Strategy & Design at Marvin. To fully embrace this trend, consider decorating with plants, choosing natural color palettes and materials, or increasing natural light in your living areas.

Kriss Swint, design lead at Westlake Royal Building Products, emphasizes the importance of a closer connection with nature and its elements, citing potential benefits like increased well-being and productivity. ‘Growing concerns about wellness and the environment are driving demand for backyard improvements and the integration of nature into design. This includes features like green roofs, large windows, and living walls.’

wooden kitchen cabinetry is predicted to dominate kitchen trends this year.

However, before you jump into a full-scale kitchen remodel, consider that you can revamp this space without breaking the bank by resurfacing or refinishing your existing cabinet fronts.

Rather than reaching for your hammer right away, consider stripping paint from wood cabinets you already have to reveal the material beneath. Alternatively, you can replace your current kitchen cabinet fronts with custom-made ones that perfectly fit your space. Consult a local woodworker for bespoke cabinetry tailored to your kitchen’s dimensions or explore options like preloved wooden cabinet fronts available in salvage yards or online marketplaces.

‘A great DIY hack for achieving premium quality without overspending is using Ikea cabinets combined with custom fronts,’ says Archie Tkachoff, Founder of Arteum.design. ‘This approach is not only cost-effective but also versatile, allowing for the application of custom doors on new and existing cabinets.’

Archie Tkachoff

walk-in pantry? 

‘In 2024, we expect to see pantries being upgraded with intelligent organization solutions, providing more space and functionality,’ predicts Laurel Vernazza, Home Design Expert at The Plan Collection. ‘When designed with floor-to-ceiling storage, the walk-in pantry can be used to conceal air fryers, coffeemakers, and larger appliances such as dishwashers, with plenty of room for pots and pans, spices, and dry goods’.

Simply clear the kitchen closet and assess its layout. Install adjustable shelving for better storage, add hooks or racks for spices and dried goods, and improve visibility with an overhead light. 

Laurel Vernazza

2-Tier Stainless Steel Lazy Susan

Butterfly Ginkgo K-Cup Carousel

coffee station or walk-in pantry.

Royal Check Large Enamel Canister

wainscotting.

7. DIY built-in bookshelves

(Image credit: Michael Clifford/Jake Arnold)

The classic built-in bookshelf remains a popular choice for 2024, and it’s easy to see why. With just a modest amount of DIY expertise, you can easily turn an ordinary bookshelf into a faux built-in feature that instantly elevates your home.

Start by measuring your space and acquiring the right number of standalone bookcases for the job. We recommend options such as Ikea’s Billy bookcase or Wayfair’s Lagner bookcase, as they are well-suited to this task. Securely anchor these bookcases to the wall, ensuring they are level and perfectly aligned.

To achieve that coveted built-in appearance, add a plywood surround, crown molding, or decorative trim that complements your room’s style. After carefully caulking and sanding any rough edges, apply paint or stain to the bookshelves, allowing them to seamlessly blend into their surroundings. 

Home renovation trends are typically less transient than paint trends, such as the color of the year, and can significantly improve the aesthetic and functionality of your home.   

Source: homesandgardens.com

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Mortgage rates barely changed this week, but experts still expect further declines in 2024.

The average rates for 30-year loans inched up to 6.62% from 6.61% a week ago, according to tracking by Freddie Mac on Thursday. Aside from this week’s minuscule rise, rates have been declining for weeks since late October, falling nearly 117 basis points from a 12-month high of 7.79% at the end of October.

Those recent declines have boosted homebuyers’ ability to purchase homes, but further affordability improvement could be curbed by a continual supply shortage, especially if lower rates bring back sidelined demand.

“While mortgage interest rates are expected to overall decline in 2024, minor fluctuations in weekly mortgage interest rates are to be expected,” Jessica Lautz, National Association of Realtors’ deputy chief economist, wrote to Yahoo Finance.

“The biggest demand is likely to come from those who had been priced out of the homebuying market. For spring, there will likely be competition among the steady share of all-cash homebuyers and first-time buyers trying to edge in,” Lautz added.

Read more: Mortgage rates decline. Is 2024 a good time to buy a house?

Rate drop improving affordability

The national median monthly mortgage payment on purchase applications fell by $62 to $2,137 in November from the month prior, according to the Purchase Application Payments Index (PAPI).

“Homebuyer affordability improved in November, with a decline in mortgage rates, providing relief to prospective homebuyers,” Edward Seiler, MBA’s associate vice president, said in a press release. “MBA expects that affordability conditions will continue to improve as mortgage rates decline, which should generate increased demand heading into the spring homebuying season.”

A decrease in PAPI — indicating stronger affordability — can be attributed to a reduction in borrowed loan amounts, a drop in mortgage rates, and an increase in incomes.

However, homebuyers’ ability to afford homes is still lower than a year ago. Mortgage applicants are paying $160 more, or 8.1% higher, each month compared to the national median mortgage 12 months ago. While rates didn’t increase substantially this week, homebuyers today are still paying 14 basis points more than 12 months ago, when the average 30-year mortgage rate was 6.48% on Jan. 5, 2023, according to Freddie Mac rates archive.

Read more: How to buy a house in 2024

Many experts are predicting further rate drops in 2024, though. As the US economy is expecting a soft landing — where inflation curbs without a national recession — rates are poised to drop to around 6% or potentially lower by the end of 2024.

“If inflation continues to show signs of improvement and the bond market remains less turbulent than during much of 2023, mortgage rates should at the very least stabilize this year, if not show sustained declines,” Jacob Channel, LendingTree’s senior economist, predicted for 2024 housing and economic market.

Housing experts said further affordability improvement could be curbed by a continual supply shortage, especially if lower rates bring back sidelined demand. (Photo by Andrew Caballero-Reynolds/AFP) (ANDREW CABALLERO-REYNOLDS via Getty Images)

Affordability curbed by lack of listing

Housing experts warned that limited inventory could restrain affordability improvement achieved by declining rates. Without adequate supply, sidelined prospective buyers returning to the market could outpace the housing supply and increase competition.

“Homeowners may still be reticent to move from low interest rate mortgages, which may be in the 2.5% to 3.5% range, until they are in a situation where a life or job change occurs forcing them to reconsider their living situation,” Lautz said.

Total inventory of unsold existing homes, not including new constructions, declined 1.7% from the previous month to 1.13 million units at the end of November, according to the National Association of Realtors. This is the equivalent of 3.5 months of supply on the market, nearly 2.5 months lower than what experts believe to be a balanced and healthy market of 6 months.

For context, today’s existing home inventory levels are relatively close to the record low of 860,000 units in January 2022 compared to the record high of 4.04 million units in July 2007.

But inventory could still see a slight uptick as more sellers reach their “tipping point,” or the rate level at which homeowners are willing to sell their homes. Most homeowners — nearly 92% — have rates below 6%, Redfin says. But as rates drop to 6% or below, more owners could be open to selling. This would reverse the mortgage rate lock phenomenon that slowed the housing market in 2023 when most homeowners refrained from selling to keep their lower-than-market rates.

However, experts don’t expect a significant jump in inventory that could bring down home prices, as roughly 4 in 5 homeowners still have rates below 5%, and one-quarter have rates below 3%.

“We are not going to see a big turnaround,” Danielle Hale, Realtor’s chief economist, said on 2024’s affordability challenges during NAR’s Real Estate Forecast Summit. “But I do think we are going to see baby steps in the right direction.”

Rebecca Chen is a reporter for Yahoo Finance and previously worked as an investment tax certified public accountant (CPA).

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Source: finance.yahoo.com

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If you’ve always dreamt about walking a mile in Tom Brady’s shoes, an opportunity just came up — but you’d have to pony up some serious cash to afford it.

A glam apartment at the Fendi Chateau Residences in Surfside, Florida that the former New England Patriots / Tampa Bay Buccaneers quarterback rented after his divorce from supermodel Gisele Bündchen landed on the market, looking for a new owner to enjoy its unobstructed ocean views.

As expected, it has a price tag worthy of its former occupant’s deep pockets: the Fendi Chateau unit is listed for a hefty $15,900,000.

But it comes with the added perk of owning a space that served as a bachelor pad for the NFL’s most decorated and accomplished players, not to mention a whole suite of luxury amenities and upscale finishes that the Surfside building has gained a reputation for.

Photo credit: Become Legendary courtesy of Compass Florida

Inside Tom Brady’s former apartment at the FENDI Chateau Residences

Tom Brady reportedly lived here right after his widely-covered divorce from Gisele Bündchen, with media outlets dubbing it the NFL superstar’s “bachelor pad”.

He rented it during his final year with the Tampa Bay Buccaneers before announcing his retirement (for a second time) in February 2023.

See also: Tom Brady’s & Giselle’s Custom-Built Home in Brookline, Massachusetts

The unit is one of only 58 residences in the luxury residential development — which sets itself apart from nearby Miami’s soaring skyscrapers, rising only 12 stories high and adding a note of boutique living to its appeal. Mendel Fellig with Compass Florida holds the listing.

Key facts & numbers

  • Location: 9349 Collins Avenue, Surfside, FL
  • Bedrooms: 3
  • Bathrooms: 4.5
  • Square footage: 4,103
  • Year built: 2016 (building)
  • Amenities: White glove service (including full beach service), in-house salon and spa, state-of-the-art fitness center, resident-only restaurant, kid’s club, and more.
  • Asking price: $15,900,000

“The condo offers a sanctuary of privacy and luxury, boasting unobstructed ocean and skyline views and a highly desirable flow-through layout,” listing agent Mendel Fellig tells us. “With only 58 units, the building ensures an intimate and exclusive living experience.”

Photos

Photo credit: Become Legendary courtesy of Compass Florida
Photo credit: Become Legendary courtesy of Compass Florida
Photo credit: Become Legendary courtesy of Compass Florida
Photo credit: Become Legendary courtesy of Compass Florida
Photo credit: Become Legendary courtesy of Compass Florida
Photo credit: Become Legendary courtesy of Compass Florida

With its many wellness-oriented amenities, the Surfside building is a great choice for athletes

While Tom Brady was undoubtedly the Fendi Chateau Residences’ most famous resident, the building is known for attracting top earners.

Current and former residents reportedly include UnitedHealthcare CEO, Claudio Lottenberg, Founder of Naturhouse, Felix Revuelta, Founder and CEO of E&M Management, Irving Langer, and Software Chief of Totvs, José De Lucena Cosentino.

And it’s easy to see why.

Talking about the many amenities Fendi Chateau residents enjoy, Fellig lists upscale features like “full beach service, in-house salon and spa, business center, movie theater, and a resident-only restaurant, creating a lifestyle of pure luxury. It’s easy to see why a celebrity may be captivated by the privacy, luxurious amenities, and the stunning ocean vistas that this property provides.”

Photo credit: Become Legendary courtesy of Compass Florida

Standing out in its long roster of amenities are the building’s many wellness-oriented perks, which make it a great choice for athletes.

“Fendi Chateau is the perfect haven for athletes, with a focus on health and wellness,” agent Mendel Fellig confirms.

“The residence offers a state-of-the-art fitness center, a rejuvenating sauna, an invigorating steam room and a private massage room. These amenities make Fendi Chateau the ultimate destination for athletes looking to maintain their physical well-being.”

“The in-house facilities offer a comprehensive approach to fitness and recovery, making it the top choice for athletes seeking luxurious living that caters to their health and fitness needs.”

So it wouldn’t be at all surprising to see another athlete taking up residence here. Who do you think that might be?

The article You can buy Tom Brady’s former Miami apartment – But it won’t come cheap first appeared on Fancy Pants Homes.

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A Jupiter, FL house across the waterway from Tiger Woods’ place sells for $15.4M

Mar-a-Lago neighboring mansion undergoing a massive renovation eyes $40 million sale

Source: fancypantshomes.com

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A condo is a privately owned unit in a community of other units, often with shared areas or amenities. If you’re considering whether to buy or rent a condo, you’ll want to think about the costs, benefits, and responsibilities of each option.

Of course, those who are deciding whether or not to rent have much less riding on their choice, but it’s still worth delving into the pros and cons of this kind of property and if it suits your needs.

Here, you’ll learn about the characteristics that define condos, the pros and cons of these units, and what it’s like to rent or buy a condo.

What Is a Condo?

As noted above, a condo is a privately owned unit that is part of a community of other units, whether that means there are a couple of other residences or dozens. Typically, a condo owner only possesses their unit, unlike the situation with a single-family homeowner, who owns the home and the land under it.

You may be familiar with condos that are rented out for income. If you’ve ever rented an apartment in, say, a complex by the beach, with a shared pool and patio, there’s a chance you’ve been in a condo. Real estate investors often buy condos and rent them out in this way.
💡 Quick Tip: You deserve a more zen mortgage. Look for a mortgage lender who’s dedicated to closing your loan on time.

Characteristics of a Condo

Individual condo units are owned by private owners, while common areas are owned and maintained by an association or organization. This might be called a condo association (CA) or a homeowners association (HOA). These groups are not identical, but they do manage a multi-unit residential community.

Your ownership rights may be limited to the space within your condominium, as is the case with most condo high-rises, or you may own an entire standalone structure within a larger community. In a condo situation, the CA or HOA owns the land. In a planned unit development, the homeowners own their lot and share the common area.

Maintenance and Finances of Condos

Condos are popular starter homes, thanks to their low maintenance, relatively cheap purchase price, and general convenience. They may also appeal to investors and people who are downsizing.

With detached single-family homes, you’re on the hook for the bill if any repair issues arise, whether it’s a broken water heater, leaky roof, or malfunctioning air conditioner. This generally isn’t the case with condos, as the property management company employed by the CA or HOA maintains common areas and shared amenities.

Convenience comes with a price, though. Condo owners share maintenance costs, and the expense of a master insurance policy, by paying dues monthly or quarterly. It’s important to budget for these costs. HOA fees,for example, have recently been rising 10% per year. Atop those fees, special assessments can be levied if the HOA needs to pay for a major project.

Condos tend to appreciate at a slower rate than traditional single-family homes, but they cost less. So buyers may want to take both realities into consideration when deciding on house vs. condo.

Recommended: First-Time Homebuyers Guide

Types of Condos

Condos vary widely in structure and appearance, ranging from high-rise buildings to communal developments. Take a closer look:

Condo Developments

These are communities of standalone homes where maintenance of both the interior and exterior are carried by the condo owner, but services like the maintenance of common areas and snow removal are typically handled by a property management company.

All properties within a condo development are bound by the rules of the CA or HOA, so it’s similar to a traditional neighborhood with fixed rules and less upkeep.

Condo Buildings

These are high-rise apartments consisting of individual condo units. The maintenance of the structure, shared utilities, and common areas are the responsibility of the property management company.

If you’re looking at buying or renting an apartment in a large metropolitan area, make sure you understand what it means to choose between a condo and a co-op.

High-rise condo buildings are more common in urban areas and may have higher fees in order to cover the greater costs of maintaining an apartment building and often the salaries of full-time maintenance staff members and doormen.

Pros and Cons of Condos

Next, take a look at the pros and cons of a condo.

Pros of Condos

Here are the upsides of condo life:

•   Less maintenance since the CA or HOA is responsible for many aspects of upkeep.

•   Affordability. Since you don’t own the land, the price can be lower.

•   Possible investment opportunity; can use a condo for rental income.

•   Security. Some people appreciate having a condo staff and neighbors nearby.

•   Social life. You’re part of a community and will likely know and connect with your neighbors to some extent.

•   Amenities. There are often such features as gyms, pools, dog run, coworking space, party rooms, and other perks to enjoy.

Cons of Condos

Next, consider the potential downsides of a condo:

•   Association rules. You have to adhere to the guidelines of the community, which may or may not suit you. This can include everything from the appearance of your home’s exterior to when and for how long you may rent your place out.

•   Higher interest rates. If you are shopping for a condo to purchase, you may find that the mortgage rates are somewhat higher than what you’d be quoted if you were buying a single-family home.

•   Investment risk factor. If you are buying a condo, its value could depend to some extent on other residents and how well they maintain their property.

•   Lack of privacy and land. You will have neighbors…so the experience is different from being in your own single-family home on your own land. And you likely won’t have acres of property to plant and use as you wish.

•   Rising costs. Your association payments can rise considerably, and assessments are possible as well. That can throw a wrench in your budget.

Recommended: Most Affordable Places to Live in the US

Buying or Renting a Condo: Which Is Better?

Whether you’re better off buying or renting a condo — or any of the other types of houses, from modular home to manufactured home, tiny house to townhouse — depends as much as your own circumstances as it does the cost of buying vs. renting in an area.

•   Buying: Assuming you’ve decided to settle down in an area for the next three to five years, you might be better off buying a condo if you have a stable income stream and can cover the down payment and closing costs without emptying your emergency fund.

Given how real estate values have risen in the past few years, buying a condo may be a good choice if you’re looking for long-term investment and a chance to build home equity over time.

•   Renting: You may be better off renting if there’s a chance you’ll need to relocate within the next few years, or if any upcoming life events might require you to upsize your residence, like having children.

Here’s a closer look at these scenarios.

Pros of Renting a Condo

Renting a condo gives you all of the benefits of living in a private condo unit without the long-term commitment and upfront costs.

•   Few maintenance responsibilities: If you’re renting a condo unit in an apartment building, the association is responsible for maintenance, or in the case of an individually owned HVAC system, the owner is.

•   More leeway for negotiation: Reliable renters are hard to come by; some condo owners may be more willing to negotiate your monthly rent than professional property managers are.

•   Flexibility to end or extend your lease: As a renter, you can often decide whether to end or continue your lease. This makes it easy to cut ties if needed.

Pros of Buying a Condo

Taking out a mortgage to buy a condo more or less freezes your living costs into the future. This will help you avoid rising rents, though association fees can certainly rise.

•   More affordable than single-family homes: The price of a condo is usually lower than a single-family home in a given area. This makes it attractive to homebuyers on a budget.

•   Freedom to make it your own: Owning a condo gives you more freedom over such features as the appliances and color palette than you’d likely have with a rental.

•   Rental potential: Depending on the rules of your association, you may have the right to rent out your condo to generate income.

Finding a Condo

If you’re ready to go out and shop for a condo, you’ll want to assemble a list of must-haves to narrow your search. This applies whether you’re looking to rent or buy.

Are you looking for a more affordable apartment condo or something with more space like a community development? Browse local listings for condo units that match your requirements.

For those seeking to buy a condo, it’s a good idea to find a real estate agent who’s well versed in condo sales. They know the area and can obtain vital info regarding association rules and financials. It’s important to review the rules and fees, and check for any special assessments and their frequency over the years.

Condo Tips

A few more suggestions as you start your hunt:

•   If you are planning to buy, it’s also a good idea to thoroughly understand mortgage basics and have financing lined up with a mortgage company so you’re ready to make a bid on a property.

•   Know your budget. A mortgage calculator is an excellent tool for helping you figure out your costs.

•   Consider checking this HUD site for FHA-approved condos as your primary residence if you are seeking financing with an FHA loan.

💡 Quick Tip: Keep in mind that FHA home loans are available for your primary residence only. Investment properties and vacation homes are not eligible.1

The Takeaway

What is a condo? A condo is a privately owned unit within a community that can be a good starter home or a place to downsize. Or it might be a wise investment property that can bring in rental income. If you’re able to rent a condo, it’s much like renting an apartment, except your landlord may be the owner.

If you’re interested in buying a condo, realize that condo buyers are able to access the same kinds of loans available to buyers of single-family homes, though rates may be slightly higher.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% – 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It’s online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

What’s the difference between an apartment and a condo?

A condo can be a kind of apartment, which is a residential unit that’s part of a larger building. An apartment can be owned or rented, as can a condo. However, a condo is a specific kind of unit ownership in which there are communal facilities and shared maintenance charges.

What is the difference between a condo and a townhouse?

With a condo, you own your unit but not the land under and around it. You pay for your unit (rent or mortgage). Association charges cover maintenance and repairs, and property taxes apply to owners. With a townhouse, the property includes the residence and the land it sits on and that surrounds it. You will pay your rent or mortgage and real estate taxes, but may not be part of an association or obligated to pay those fees.

Is a condo the same as a flat?

Many people use the terms condo, apartment, and flat interchangeably. While an apartment and a flat are the same thing, a condo refers to a style of ownership of a dwelling unit that’s part of a community. It may be an apartment, but the way it’s bought or rented can differ.

Photo Credit: iStock/Edwin Tan

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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Source: sofi.com

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Alyssa Gautieri (she/her) is the associate lifestyle editor for Good Housekeeping, where she covers all things home and interior design. Prior to joining GH in 2022, she wrote for publications including ELLE Decor, Chairish, BobVila.com, Unique Homes Magazine and LODGING Magazine, in addition to crafting product copy for home brands like BrylaneHome and VIGO Industries.

Source: goodhousekeeping.com

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In the first week of 2024, mortgage rates continued to stick around the mid 6% mark.

The 30-year fixed-rate mortgage averaged 6.62% as of Jan. 4, a slight increase from the 6.61% rate recorded on Dec. 28, according to Freddie Mac‘s Primary Mortgage Market Survey released on Thursday. The 15-year fixed-rate mortgage averaged 5.89% this week, down from 5.93% the prior week. HousingWire’s Mortgage Rates Center showed Optimal Blue’s average 30-year fixed rate on conventional loans at 6.68% on Thursday, up from 6.56% recorded at the same time last week.

“Between late October and mid-December, the 30-year fixed-rate mortgage plummeted more than a percentage point,” Freddie Mac Chief Economist Sam Khater said in a statement. “However, since then rates have moved sideways as the market digests incoming economic data.”

Given the expectation of rate cuts this year from the Federal Reserve, Khater expects mortgage rates to continue drifting downward.

“While lower mortgage rates are welcome news, potential homebuyers are still dealing with the dual challenges of low inventory and high home prices that continue to rise,” he added.

One year ago this week, the 30-year fixed-rate mortgage stood at 6.48%, while the 15-year rate stood at 5.73%.

Lower rates attract homebuyers back to the market but difficulties persist

According to a Realtor.com survey, 11% of surveyed prospective homebuyers said that they would be able to buy a home if rates went below the 7% threshold. Another 12% of surveyed homebuyers said that rates would need to dip below 6% for them to be able to buy a home. Meanwhile, more than a quarter (28%) said rates would need to dip below 4% to bring them into the market. 

Currently, the typical outstanding mortgage rate is still under 4%. This discrepancy is not creating any incentive for sellers to sell their homes in the current rate environment, according to Realtor.com Economic Research Analyst Hannah Jones. 

However, the cost of buying a home did come down in December, sending an encouraging signal to the market. As per a Redfin study, the median U.S. mortgage payment was $2,361 during the four weeks ending December 31, down $372 (-14%) from October.

According to Bright MLS Chief Economist Lisa Sturtevant, the lack of inventory remains the main issue, keeping home prices elevated.

“Young buyers are having to delay buying a home as it takes them longer to save for a down payment and they often have to make offers on multiple homes before they are successful,” Sturtevant said. “Many first-time homebuyers have been priced out of the market altogether.”

Sturtevant expects the lack of inventory to remain a challenge this year even as mortgage rates fall.

Source: housingwire.com

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Whether you’re buying a house or a car, financing a wedding or vacation, embarking on a major home renovation, paying for rising medical costs, or even consolidating debt, you might need to take out a loan.

But what about when you’re retired?

Even though they don’t earn a traditional income from a paying job, retirees can still take out loans. Requirements for retirees to secure a loan might be a little stricter, but it’s certainly possible.

Below, we’ll dive into loans for retired people — how they work, common types, and where to find them.

What Are Retiree Loans?

A retiree loan is any loan that you take out in retirement. It doesn’t refer to one specific type of loan, but rather a collection of loan types available to anyone in retirement, as long as they qualify.

Qualifying for a loan as a retiree can be more challenging than someone who is still employed full-time, since lenders like to see steady income. But many retirees have reliable sources of income outside of a job that can help them qualify.
💡 Quick Tip: Some personal loan lenders can release your funds as quickly as the same day your loan is approved.

Considerations for a Loan

When considering loans for retired individuals, lenders may consider a number of income sources, as well as an applicant’s debt-to-income ratio and credit score.

Retirement Income

One of the main sources of income for seniors who no longer work is their retirement accounts. If you are retired, you might receive regular payments from an IRA, 401(k), pension, and/or Social Security.

Collectively, these accounts make up your retirement income. And they may be significant enough to take out a retiree loan, like a personal loan, car loan, or even a mortgage.

Fixed Income

Retirees may have other sources of fixed income beyond their retirement income. For example, retirees might earn income from investments, earn annuity income, or receive spousal or survivor’s benefits. Retirees may also generate revenue from rental properties.

If any of these are limited sources of income — that is, they’ll run out eventually — the lender might require proof that you’ll at least receive that income for a set number of years. Without that proof, they might not factor in that source of income when determining loan eligibility.

Some retirees continue to work, whether full- or part-time or even as a contractor. If you’ve taken up a side hustle, like driving for a rideshare service or acting as a consultant in the field from which you retired, your 1099 income may also help when applying for a loan in retirement.

Assets

Retirees who have a significant portion of their money tied up in assets may be able to leverage those assets to secure a loan. For example, mortgage lenders might offer a securities-backed loan.

Securities-backed loans offer retirees liquidity without selling their assets. Instead, the lender can claim ownership of your assets — stocks, bonds, and real estate, for instance — if you default on your loan.

Because investment values fluctuate, a lender will likely consider only a reduced value of your assets (up to 70%). This protects them in the event that your assets decrease in value during the life of the loan.

Debt-to-Income Ratio

Lenders consider more than just your income when you apply for a loan, especially in retirement. They’ll also look at your debt — and thus your debt-to-income (DTI) ratio.

Your debt-to-income ratio is a calculation of all your monthly debts divided by your gross monthly income. This might include credit card debt, mortgage payments, car loans, personal loans, and even student loans.

For example, if your monthly debts total $2,000 and your monthly income is $10,000, your DTI ratio is 2,000 / 10,000. That’s 0.20, or 20%.

The higher your DTI ratio, the less likely a lender is to approve you for a loan. While requirements will vary by lender and the type of loan you’re applying for, you’ll likely have a harder time securing a loan if your debt-to-income is 50% or higher.

Credit Score

As with any other loan, lenders will also factor in your credit score when you apply for a retiree loan. By improving your credit score, you increase your chances of getting a loan.

So what affects your credit score? Generally, five key factors can influence your rating:

•   Credit utilization

•   Payment history

•   Credit history length

•   Credit mix

•   New credit

Retirees generally have longer credit histories, especially if they keep credit cards open and have been paying a mortgage for decades. By paying your bills on time, keeping your credit usage down, and resisting the temptation to apply for new credit cards, retirees may be able to raise their credit scores ahead of applying for a larger loan in retirement.

Where to Find a Retiree Loan

Retirees can look for loans in the same places that other borrowers do. Financial institutions like banks and credit unions generally offer a wide range of loans, from mortgages and car loans to personal loans and debt consolidation loans. Your own bank or credit union is a good place to start.

Where you get a retiree loan can also depend on the type of loan. For example, if you’re purchasing a new car, the dealership may help you find financing. When you work with a real estate agent to buy a home, they might put you in touch with a lender.

Common Retiree Loans

Retirees have access to a wide range of loans depending on their needs. Here are some of the most common types of retiree loans you might come across:

Home Equity Loan

A home equity loan allows you to borrow against the equity you’ve built in your house. You generally need to have paid off at least 15% to 20% of your home to have enough equity for a loan; the more you’ve paid off, the larger the loan could be.

You might use a home equity loan to fund a renovation project, medical payments, or even debt consolidation. But remember, your house serves as collateral, so it’s important to make your payments.

Reverse Mortgage Loan

Reverse mortgage loans are available to people who are 62 or older who have paid off most of their mortgage or own their homes outright. When you get a reverse mortgage, you retain the title to the home and don’t have to pay the loan (and interest) until the last surviving borrower has moved out permanently.

Reverse mortgage loans are not for everyone. Weigh the pros and cons of a reverse mortgage before moving forward.

Debt Consolidation Loan

Retirees who are struggling with various debts may choose to consolidate in a single loan, ideally at a lower interest rate. Consolidating your debt means only a single monthly payment, but it could extend the number of years it’ll take you to be debt-free.
💡 Quick Tip: Swap high-interest debt for a lower-interest loan, and save money on your monthly payments. Find out why SoFi credit card consolidation loans are so popular.

401(k) Loan

If you’re strapped for cash ahead of retirement, you may be able to borrow from your 401(k) account balance before you start receiving distributions. Doing so has certain tax implications to review with your accountant.

Unfortunately, you cannot take out an IRA loan, though if you’re 59 ½ or older, you may be able to make early withdrawals penalty-free.

Personal Loan

You can take out a personal loan for almost anything — wedding costs, home improvements, even credit card debt consolidation. Personal loan interest rates and terms vary depending on the length of the loan. For example, SoFi offers personal loans with low interest rates, and there are no fees required.

Just make sure you have the right credit score for a personal loan before applying. Bad credit borrowers may qualify, but the interest rates can be significantly higher.

Payday Loan

Seniors in retirement may also take out payday loans in an emergency, but keep in mind that there are a lot of risks with payday loans, including high costs.

Requirements for Getting a Personal Loan as a Senior Citizen

Lenders have similar requirements for all applicants, including retirees. The notable difference is that your sources of income will be different from an employed individual receiving a steady paycheck.

Here’s what lenders will generally look for when deciding to approve your loan application:

•   Your sources of income (retirement distributions, Social Security, investment revenue, part-time work, etc.)

•   Age (some lenders may not give out loans to borrowers who are 75 or older)

•   Credit score

•   Debt-to-income ratio

•   Collateral or assets

The Takeaway

Retiree loans refers to any loan you take out in retirement. Depending on your needs and financial goals, it may make sense to apply for a personal loan, home equity loan, 401(k) loan, debt consolidation loan, or other loan type. Retiree loan requirements are similar to those of any other borrower; you’ll just have to demonstrate other sources of income since you’re no longer employed full-time.

You’ll also need a low debt-to-income ratio and a high credit score.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

SoFi’s Personal Loan was named NerdWallet’s 2023 winner for Best Online Personal Loan overall.

FAQ

What are retiree loans?

Retiree loans are any type of loan you get in retirement. Retirees may take out personal loans, mortgages or reverse mortgages, home equity loans, and even debt consolidation loans.

What are the requirements for a retiree loan?

Requirements for a retiree loan are similar to those of other borrowers. Lenders will need to see all your sources of income, and you’ll also need a low debt-to-income ratio (generally below 50%) and high credit score (requirements vary by type of loan). You’ll also need assets to back up a secured loan.

Where can I get a retiree loan?

Retirees can look for loans anywhere that other borrowers might apply for a loan. Common retiree loans include home equity loans, 401(k) loans, debt consolidation loans, and personal loans. Because retirees typically no longer have a traditional source of income (i.e., a paying job), they may have to meet additional requirements to qualify for a loan.

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Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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