Not everyone has the ability to buy their first home at 35 or younger. Circumstances force some to start late, perhaps from their 40s or even after. Whatever the reasons, these buyers may face some additional hazards. It’s not just about making sure the lease lasts until you’re 95; you also need to consider financing issues, as well as the shorter holding period. Here are some of the issues that might pose a problem:

1. Underestimating the risk of lease decay

A common mistake among older buyers is to handwave lease decay. It’s easy to understand why: in theory, being older means you need fewer years on the remaining lease. On top of that, advanced lease decay tends to significantly lower the price of a property: a tempting proposition, if you’re already faced with higher down payments and monthly loan repayments (see below). Another source...