More 1st-time buyers putting down roots in childhood home
The stairs creaked in
Jen Gorgano’s childhood home. Recalling those sounds makes Gorgano smile. “Growing up, we would always know who was running up and down the steps by how loud it was,” she said.
The creak is still there. So is Gorgano. She is in the process of buying the four-bedroom house in Commack, New York, from her mother, who now divides her time between Florida and her partner’s Long Island condo.
“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 was selling it to a stranger,” Gorgano added. “She could sell if for another $100,000. She’s definitely doing us a favor.”
Some first-time buyers are taking the “starter home” idea to another level. They’re purchasing the houses they really did start in: their parents’ houses.
“We’ve seen this more in the last few years,” said Bob Driscoll, a senior vice president and the director of residential lending at Rockland Trust. “The one thing that’s clear in this market is that people have to look at different ways to attain homeownership.”
The typical starter house sold for $240,000 at the end of 2023, up more than 45% from pre-pandemic levels, according to the online real estate broker Redfin. The average mortgage rate was 7.2%, compared to 4% before the pandemic. (In early February, the rate was 7.15%.) Further challenging prospective buyers: new listings of starter homes for sale in the spring of 2023
dropped almost 25% from 2022.
The motivation for some buyers is to make life easier for their parents. But like many family matters, the dynamics can be complicated. (What’s a fair price? How do siblings feel about the arrangement?)
Scott Peritzman was a toddler in 1975 when his parents bought a four-bedroom house in Manalapan, New Jersey. Peritzman moved out when he was 18. Four years ago, he moved back home.
“Mom and Dad had some illnesses and were getting older,” said Peritzman, now 51, the virtual chief information officer at a tech company. “I wanted to help them both with finances and with the upkeep of the house. A lot of maintenance needed to be done.”
Not long after returning home, Peritzman, a perennial renter, broached the topic of buying the house from his parents — but keeping them in residence. “I had looked at new houses, fixeruppers. It was always with my parents in mind,” he said. “But I didn’t want to move them far from their existing medical community and friends, and I wanted to make sure they didn’t have to move into an assisted living community.
“Ultimately, I decided that buying their house was the best decision,” continued Peritzman who paid $510,000 and closed on the property in 2022, and has since done a complete renovation.
“My parents treat it as my house, but I don’t want them to feel that way,” he said. “I come from a small family. My sister and I are really close to my parents. They gave us many opportunities when we were growing up and I wanted to do what I could to help them.”
“Some parents are on fixed incomes and their kid’s income is rising, so to have the child buy the house is a perfect solution,” said Driscoll of Rockland Trust. “It matches everybody’s dream. The parents get money to help them later in life. The child gets to have homeownership.”
For some of these firsttime buyers, it isn’t simply that the price is right, or at least manageable. They’re also holding on to heritage. “This was the first house my parents owned. It’s the first house I’ve owned,” Peritzman said. “And I get to keep my family’s name in the town where I grew up.”
Gorgano says there is an “extra layer of comfort” that comes with living in her childhood house.