Baby Boomers And The Current Real Estate Market
For the last 24 months the real estate market has been slowed by a lack of homes for sale. We are in a time with a stronger than normal job market and low rates which should be a formula for soaring sales. One theory of the cause for this stagnant market is the Baby Boomers. Who are Baby Boomers? Baby Boomers are defined as anyone between the ages of 50 and 65.
It’s not something they are doing to harm the market, it is what they aren’t doing which is selling their homes and downsizing. In a homeowner survey conducted last year by Realtor.com, 85 percent of them said they didn’t plan on selling their homes in the next year, compared with 59 percent of millennials who are homeowners.
This age range traditionally downsized their larger homes once their families where grown which promoted market movement. But with the current high cost of housing for most of them it’s cheaper to stay put. With boomers remaining in their homes, that removes about 33 million properties from the market, Realtor.com estimated
According to Trulia baby boomers currently own about 3.6 million unoccupied rooms. A couple of options for them are moving closer to city areas for more of a social life and or into adult communities. The draw backs are with cities the costs are very high and unaffordable. Most adult communities, which are affordable, seem to predominantly far from urban centers.
While there is no clear solution to this issue now, this generation will continue to find ways to downsize and move back into areas or communities where they can enjoy a social atmosphere again.