10 Unexpected Problems Older Homebuyers Face

Are you thinking about relocating to a new home as part of your retirement plan? Whether that means downsizing or moving across the country, you could be one of the people ages 65 and up who find themselves looking for a new home as they start that second chapter in their lives.

However, you might be surprised by some unexpected challenges that arise when you buy a property later in life. 

Below, we'll explain what to expect as you venture back into the housing market and offer tips on how to manage unexpected hurdles so you can set yourself up for a stress-free retirement no matter where you make your home.

If you're living on a fixed income, you're likely living on less money than you did when you were working. This lower income means you could have a higher debt-to-income ratio, which might make some lenders more hesitant to extend a mortgage loan.

To avoid this challenge you can try to apply for a mortgage before you officially retire. Alternatively, you might drop down to reduced hours before fully phasing yourself out of the workforce or pick up a part-time side gig so you can show lenders some extra income.

While fair lending laws prevent lenders and financial institutions from discriminating against would-be homeowners based on age, implicit ageism can be harder to identify and combat. 

A 2023 study from Boston College's Center for Retirement Research found that your likelihood of being denied a loan rises with age, and while this could be caused by a host of external factors, the correlation can't be ignored.

If you feel you've been unfairly discriminated against when seeking a loan, you should contact an attorney to discuss your legal options.

Hopefully, your kids are supportive of your decision to relocate in retirement. But inheritance issues can bring out the worst in people, including kids or grandkids who thought they'd be inheriting your property one day. 

Plus, your kids might be attached to their childhood home and struggle with the thought of leaving it behind.

Of course, where you live is ultimately up to you, not your kids. You can reassure your kids in family discussions and get your will up to date, but remember that your retirement savings were intended for you to live off of — not for your kids to rely on.

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If you're planning on aging at home for as long as possible, you'll need to invest in home upgrades like shower rails and ramps. 

While this shouldn't necessarily deter you from buying a new home, it's an important future expense to account for.

You might be used to doing your own home repairs whenever possible, but even if you stay in good shape, it'll be harder to do those repairs by yourself as you grow older. 

You'll need to dedicate a chunk of your budget toward home upkeep — which could be harder to accommodate on a fixed budget.

Maybe you've always dreamed of retiring to Florida, but once you buy a house there and move across the country, you find out the reality doesn't match your expectations. 

If you've sold your old house and gone all in on a new one, you might be too financially drained to move again.

Before making a major move, make sure you really will love spending the rest of your life in the house and area you move to since moving again will be a major hassle. 

If possible, consider renting until you're sure you love the area enough to live there permanently.

When you were younger, you might have been able to settle for a fixer-upper rather than a home you could move into immediately. 

But now that you're older, you might not have the time, energy, or cash to spend on bringing a home into liveable condition, which could limit your inventory options.

Paying for a home inspection and other closing costs can total between 3% and 6% of your total loan balance, which equates to tens of thousands of dollars. 

You'll need to cover those costs out of pocket or out of the proceeds from the sale of your own home, but either way, it's a large expense you'll need to budget for carefully.

When you buy a house, you're making a leap of faith that the property you purchase will increase in value over time. 

But there's no way to know for sure that your financial investment will pay off, and while gambling on an investment as big as a new house might have felt like a solid move when you were younger, the risk might feel too great now that you're getting on in years.

If you've lived in one area for a long time, chances are you know your neighbors and have a network in place. 

Building new relationships can take a while after you relocate, but isolation and loneliness are major health concerns as you grow older. If moving would cause you to lose proximity with people you care about, you might want to reconsider.

Downsizing or relocating to an area with a lower cost of living can be a great way to avoid wasting your money in retirement, but it comes with its own slew of challenges.

Planning for potential problems ahead of time can give you a head start on locking down the home of your dreams, ensuring you can enjoy a long and happy retirement in your dream house.