While there is really no "right" age to buy your first home, recent studies suggest that the younger you are when you do buy, the more prepared you will be financially when it comes time to retire. Unfortunately, young people are either uninterested in homeownership or think they are unable to afford a mortgage (we're looking at you, millennials), and housing experts are concerned because the rate of those who own homes in the 18-34 age range is much lower than in previous generations. We housesellers have read numerous articles citing studies that show that homeowners who purchase their homes before the age of 35 are better prepared for retirement at age 60. 

There are numerous reasons why this makes sense. First, and most obvious, when you rent you see no return on your investment. Then there is the fact that housing wealth is the largest single source of personal wealth and as people age into retirement, they rely more heavily on their wealth than an income to support their lifestyles. The earlier you can own and stop renting, the earlier you increase your net worth as you build equity that you can then use for other goals. Also, the earlier you buy, the earlier you can pay off the mortgage so that you do not have to worry about that expense in retirement. Homeowners also enjoy several tax deductions that renters do not, the most significant being the deduction of mortgage interest.

Much more so than previous generations, millennials are skipping the traditional starter home to wait until they can afford something nicer. However, a starter home is not only more affordable to young people, many of whom are burdened with student loan debt, but it offers them a higher degree of flexibility that a "forever home" does not. This includes being able to save up for that nicer home while having a smaller mortgage, and it allows them the opportunity to possibly turn the starter home into a rental investment property when they do move to their next home. As you get older you develop a clearer picture of your ideal home, and also how the size of the family you want and the neighborhood you want to live in will factor in. A starter home allows you to plan for those goals while you learn about all of the factors involved in owning a home.