Baby Boomers Expected To Give Up Homeownership | Realtor Coaching and Training
Everyone is talking about how first time buyers are one of the biggest growth markets in the real estate industry……
But, it seems….they are wrong.
Over the next 10 years one of the biggest growth opportunities will be working with…
Last Time Sellers.
With over 75 million baby boomers looking ahead at uncertainty, more job shortages for older people, and a largely unfunded Social Security and Medicare system (especially Medicare), they will begin to consider how to get liquidity from their hardest to liquidate assets – their houses. Social Security checks now average about $1100, and for a large percentage of these people this is what they will have to live on.
Sustainability of the existing financial lifestyle among the boomer group will probably be restricted to about 10-20% of the overall group. The rest will need to liquidate assets, especially aging houses, to pay monthly expenses and cover rising healthcare premiums.
The biggest decision for most will be WHEN they sell their houses if they are homeowners. This could easily lead to a large increase in the number of listed homes over the next decade where, unlike before, the seller is not the buyer of another home. It could also lead to many who do have assets (the top 20% probably have around $800,000 in assets) selling second homes and not replacing these homes.
The impact of these changes in homeownership and income will be a big increase in demand for low cost rental housing (under $600 per month with utilities and taxes), a portion of the market that is largely unavailable today.
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I agree, I need to downsize now, thinking I should return to college lifestyle for less than $20K per year. I think real estate ops of the now/future will be in college towns, setting up shared housing, fractional ownership, long term time shares to switch form Harvard to Stanford for 1 or 2 years, then on too Oxford and Cambridge, IIT. , old foggie REITs.
Let me know if you want to help with the future of RE