Educating Homeschooled Teens About Real EstateMarch 29, 2021
Guest post by Sam Bowman.
It’s easy to feel like your teen is never going to actually leave the nest. However, the truth is, they are just a few years away from starting life on their own.
One of the biggest parts of that adult life is figuring out where they’ll live. While they can always start out by renting, chances are they’re going to want to buy a house at some point — and with interest rates so low, this could quite possibly be sooner rather than later.
With that in mind, here are a few considerations to help you start educating your teen when it comes to real estate. Keep in mind that these are icebreakers for many of these topics. It’s important that you use these to talk further and encourage questions. As you dig into each item together, you can thoroughly round out your child’s knowledge before they purchase their first home.
Start With Basic Real Estate Information
Teaching your kids about real estate doesn’t have to equate to helping them go out and buy a house tomorrow. The process starts with acquainting your child with basic real estate concepts that can begin to flesh out their understanding of the industry. Here are a few of the major topics that you should discuss together:
Renting Versus Owning
It’s a debate as old as time: should you rent or buy? This is an important topic to break down with your kids. Use the occasion to talk about things like home maintenance, equity, and resale value.
Take the time to explain your own philosophies regarding each topic. At the same time, also look into the positives and negatives associated with both sides of the equation.
New Builds Versus Fixer-Uppers
When it comes to buying your own home, another question quickly arises: should you buy new or used? Unfortunately, this isn’t as simple as getting a piece of clothing or even a car. There are many different factors that go into the new or used housing debate.
For instance, a new home is less likely to have maintenance issues for a long time. It also can be built with cutting-edge technology and sustainable features.
On the flip side, a used home salvages what already exists and prevents waste. It can also be a great way to save money by purchasing a fixer-upper and then putting in your own sweat equity. Even that concept can open the door to further discussion about worthwhile home improvements versus expensive “money pit” options or even projects like roof repairs or installing air conditioning that are better left to a professional.
Counting Up The Costs
Another important area to discuss is the financial aspect of real estate. It doesn’t matter if you’re renting, building new, or fixing up, it’s going to cost a lot of money for your child to live in their own home.
Take the time to break down the various costs associated with paying for a living space. For instance, if you own a home, you have to take out a mortgage. This involves a payment that includes:
- Principal money owned on the balance.
- Interest accrued from the borrowed money.
- Insurance to protect the house from disasters.
In addition to this predictable expense, there are also closing costs, maintenance, and other home improvement expenses, many of which cannot be accurately predicted. Talking through these items can help your teen gain a greater appreciation for the complexities that come with living on your own, and particularly owning your own home.
Help Them Come Up With A Plan
Along with discussing topics in a general manner, you can also help your child prepare for their future real estate interactions. A few suggestions for ways to do this include:
- Encouraging them to save money early: Sure, they aren’t going to save up $200,000 for a nice house by the time they’re 18 years old. But even a few thousand dollars can help with things like closing costs and basic furnishings.
- Teach them what to look for: From overall size to existing appliances, potential risks, and even the number of bathrooms, there are many things to look for when buying a house. Talk through your child’s preferences with them.
- Break down the home buying process: The actual process of buying a house is very convoluted. Discuss things like working with real estate agents, shopping around, getting pre-approved for a loan, and the mountain of paperwork that’s involved.
While their plans may change over time, helping your child establish an initial idea of what they want for their real estate future is a great way to drive many of these lessons home.
Preparing Your Teen For A Successful Real Estate Adventure
There are many moving parts when it comes to renting or buying a home. These can feel overwhelming, especially if you’re forced to learn on the fly.
However, if you take the time to break down the complexities of real estate with your child while they’re still living with you, it will prepare them to handle the process with success. Not only that, it can even turn the intimidating prospect of buying a house into what it should be: an adventure.
More About the Author
Sam Bowman is a writer who enjoys getting to utilize the internet for community without actually having to leave his house. In his spare time, he likes running, reading, and combining the two in a run to his local bookstore.