The Population is Growing Older--What That Means for the Housing Market

Facts from the 2010 census confirm what we already know as we go about our daily lives: the general population is getting old. As of April 2010, there were over 40 million people age 65 and older, that’s an increase of about 15% from 2000. Other interesting statistics show
the fastest growing group of adults is those aged 65-69, up one third from 2000 and in the past decade, the population of men aged 85-94 grew by one half.

These numbers will keep growing as the baby boomers are now turning 65 in rapid numbers. What does this mean for the housing market? The boomers will leave their large suburban homes, looking for a maintenance free lifestyle, close to city amenities, services, shopping and restaurants. These boomer buyers are attracted to the condo lifestyle and smaller, one level living homes. Many of the couples I work with that aren’t ready to retire are planning for a simpler housing arrangement by purchasing ranch or 1.5 story floorplan homes. They are thinking ahead of how to eventually ‘age in place’ by modifying their surroundings. Boomers don’t see themselves moving to designated senior housing communities---saying the residents are ‘old’ and not as active as themselves. I think these communities will eventually house much older and slower moving seniors--perhaps those 90+ years, while the more physically and mentally fit ‘younger’ seniors will try to stay put in their homes. Already we l see two generations of the same family on Social Security and Medicare—at the same time.

Boomers should start to plan their final housing moves now. There could easily be an excessive inventory of McMansions lingering on the market in the near future, as I don’t predict many Gen X and Y homebuyers will want large, energy-expensive homes. This generation is delaying marriage and focusing on building a career first—and when they do marry, they don’t plan on having several children. In addition, they have quite of bit of college debt to pay off—which will affect their ability to qualify for a home purchase.

As the baby boomers see the last child prepare to leave the nest, they think of downsizing but are often overwhelmed by starting the process. If this is your situation, think about creating a plan now as to how to move into the next phase of your life comfortably. Often that first step is downsizing to a smaller home!