The stairs creaked in Jen Gorgano's childhood home. Remembering those sounds makes Ms. Gorgano smile. “Growing up, we would always know who was going up and down the stairs by the noise she made,” she said.
The crunch is still there. So is Ms. Gorgano. She is in the process of purchasing the four-bedroom house in Commack, New York, from her mother, who now divides her time between Florida and her partner's condo on Long Island.
“Financially it made sense,” said Gorgano, 25, a speech pathologist, who is buying the house for about $600,000 with her boyfriend and co-buyer Mike Stillman. “My mom gave us a price. It’s less than what she would get if she sold it to a stranger,” Gorgano added. “She could sell it for another $100,000. She is definitely doing us a favor.”
Some first-time buyers are taking the idea of a “starter home” to the next level. They're buying the homes they really started in: their parents' homes.
“We've seen this more in recent years,” said Bob Driscoll, senior vice president and head of residential lending at Rockland Trust, a bank with branches in Massachusetts and Rhode Island. “The one thing that is clear in this market is that people have to look for different ways to achieve home ownership.”
The typical starter home sold for $240,000 in late 2023, more than 45 percent higher than pre-pandemic levels, according to online real estate brokerage Redfin. The average mortgage rate was 7.2 percent, compared to 4 percent before the pandemic. (As of early February 2024, the rate was 7.15 percent.) An additional challenge for prospective buyers: New listings of starter homes for sale in spring 2023 fell nearly 25 percent from 2022.
“I am very fortunate to have this opportunity,” Ms. Gorgano said. “Otherwise I couldn't afford to buy a house right now.”
The motivation of some of these buyers is to make life easier for their parents. But as with many family matters, the dynamics can be complicated. (What is a fair price? How do the brothers feel about the deal?)
Scott Peritzman was a small child in 1975 when his parents bought a four-bedroom house in Manalapan, New Jersey. Mr. Peritzman moved when he was 18 years old and subsequently lived in Florida, California and, most recently, in Princeton Junction, New Jersey, 30 minutes away. from Manalapan. Four years ago he returned home.
“Mom and dad had some illnesses and were getting older,” said Peritzman, now 51, virtual chief information officer for a technology company. ”I wanted to help them both with finances and with the maintenance of the house. “A lot of maintenance had to be done.”
Not long after returning home, Peritzman, a permanent tenant, broached the issue of purchasing the house from his parents but keeping them in residence. “I had looked at new, renovated houses. “It was always thinking about my parents,” he said. “But I didn't want to alienate them from their existing medical community and friends, and I wanted to make sure they didn't have to move to an assisted living community.
“In the end I decided that buying his house was the best decision,” Peritzman continued. who paid $510,000 and closed on the property in 2022, and has since completed a complete renovation.
“My parents treat it like it's my home, but I don't want them to feel that way,” she said. “I come from a small family. My sister and I are very close to my parents. “They gave us a lot of opportunities when we were little and I wanted to do what I could to help them.”
“Some parents are on fixed incomes and their child's income is increasing, so having the child buy the house is a perfect solution,” said Rockland Trust's Driscoll. “It matches everyone's dream. Parents receive money to help them later in life. The child acquires ownership of his home.”
Georgeann Wheeler worked three jobs to keep her home, a five-bedroom paddock in Hillsdale, New Jersey.
“This place is their pride and joy. It was her investment,” said Stacie Gallo, 54, the eldest of Ms. Wheeler’s three children. Mrs. Gallo, a special education teacher, and her husband, Nick, a chef, bought the property four years ago. Mrs. Wheeler, now 83, still lives there in a converted garage apartment.
At the beginning of their marriage, the Gallos were tenants of a two-family home in Hawthorne, New Jersey. Space became increasingly scarce as the couple began having children; While trying to save money to buy a house, they moved into the Hillsdale house with Ms. Gallo's mother and stepfather.
“We paid a little bit of rent, but most of the money we paid by helping,” Gallo said. “My husband cooked dinner and we worked in the garden.” Then, after her stepfather died and her mother became ill, she and her husband had the property appraised ($525,000) and purchased it for $425,000.
“The house is in desperate need of renovation, but it does its job for us,” Ms. Gallo said. “And my mother is comfortable here and happy here. “I shop for food for her and she has dinner with us every night.”
For some of these first-time buyers, it's not just a matter of the price being right, at least manageable. They also hold on to their heritage. “This was the first house my parents had. “It’s the first house I’ve ever owned,” Peritzman said. “And I get to keep my family's name in the town where I grew up.”
Jen Gorgano says there's an “extra layer of comfort” that comes with living in her childhood home. “In the past, we celebrated Christmas Eve and Christmas with my mother's family,” she added. “We hope to keep that tradition going.”
