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  1. #1
    Senior Member JohnDoe2's Avatar
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    Boomers will be putting millions of homes on the market in the coming decades

    Column: Boomers will be putting millions of homes on the market in the coming decades

    [Baby boomers will be selling or otherwise vacating millions of homes in the coming years, which could have a big but hard-to-predict effect on the housing market.
    (Associated Press)

    The ‘Silver Tsunami’ will change the real estate market over time, easing tight supplies in some areas and raising questions about how much new construction will be needed

    By MICHAEL SMOLENS COLUMNIST
    DEC. 29, 2019 4:45 AM

    The shortage of affordable housing in cities across the nation is often described as a crisis, particularly in California.

    But within the next 15 years or so, this likely will happen: Baby boomers are expected to put more than 20 million existing homes on the market.


    That could have a dramatic effect on the supply and raise long-term questions about current proposals aimed at accelerating housing construction.


    The notion of having an eventual overstock of homes seems counterintuitive when these days are filled with horror stories about ridiculously high housing prices that make it hard, if not impossible, for middle-income families to live in San Diego and elsewhere.


    While a bubble of available existing homes is coming, it won’t be felt evenly across the country, nor will it necessarily provide the type of housing desired.

    There has been extensive research about this emerging phenomenon in the last couple of years.

    Zillow, the real estate database company, last month published an analysis of how the so-called “Silver Tsunami” may affect housing.


    “The massive Baby Boomer generation has already begun aging into retirement, and will begin passing away in large numbers in coming decades — releasing a flood of currently owner-occupied homes that could hit the market,” wrote Issi Romem, senior director of housing and urban economics at Zillow.


    “That could help end the last few years’ inventory drought, as well as a more fundamental shortage of homes in certain places.”


    He summarized a handful of key points in his research:

    • Over the next 20 years, more than a quarter of the nation’s currently owner-occupied homes are likely to go on the market as their current owners pass away or otherwise vacate their homes.


    • Places expected to be most affected by this sell-off include both retirement hubs (Miami, Orlando, Tampa and Tucson) and regions where young residents have left (Cleveland, Dayton, Knoxville and Pittsburgh). The effect will vary across different areas within cities, as well.
    • The places likely to be least affected include those with vibrant economies featuring fast growth and affordable housing that attract younger residents (Atlanta, Austin, Dallas and Houston).
    • The overall boost to the housing supply may be “comparable in magnitude to the fluctuations that new home construction experienced in the 2000s boom-bust cycle.”
    • The construction industry may need to place a greater focus on updating existing properties, in addition to building new homes.


    Zillow lists San Diego in the middle of nearly 60 metropolitan areas it surveyed in terms of owner-occupied homes expected to be put on the market by seniors (60 years and older) through 2036.

    Tampa has the most, at well over 30 percent of its owner-occupied housing in this category, and Salt Lake City the least, at just under 20 percent.


    San Diego housing analyst and consultant Gary London cautioned that this trend will be drawn out, even more so in places like San Diego than elsewhere.


    “It will be a huge and gradual transition,” he said.

    Seniors who bought or built here years or decades ago have benefited from tremendous appreciation of their homes. That also may have limited their options. While the notion of downsizing might be attractive, the capital gains hit from selling a current home and the significantly higher property taxes of a potential new one has many people staying put.

    The concept of “aging in place” may be desirable in order to remain in familiar surroundings, but increasingly it is also an economically advantageous one. Then there’s the evolving, active lifestyles of older people (“70 is the new. . .”). And who knows what human longevity will be in 20 years?


    “What we don’t know is what are going to be the behavioral propensities of aging,” said London, senior principal at London Moeder Advisors.


    He doesn’t anticipate this trend by itself providing relief to the local affordable housing crunch any time soon.


    While no one disputes the demographic data regarding baby boomers — those born between 1946 and 1964 — others agree the outcomes are uncertain.

    A study by Fannie Mae’s Economic and Strategic Research Group warned that the “beginning of a mass exodus looms on the horizon” and it may create a housing glut in some markets, resulting in lower selling prices. But one of the study’s co-authors, University of Southern California professor Dowell Myers, told the Chicago Tribune that “it’s impossible” to forecast price impacts “10 years ahead.”


    Still, that study and one by the Stephen S. Fuller Institute at George Mason University suggested a boomer housing bust is looming, according to the Tribune.

    Fannie Mae’s most conservative estimate is that 23.6 million homes would be released by the baby boom generation through 2036.


    Homeowners face the prospect of not only of failing to get their price — or perhaps even losing money because of the widespread sell-off — but having difficulty finding interested buyers.


    Millennials have been slow to enter the housing market, in large part because of affordability.


    USC’s Myers said he hoped all the research would spur discussion about policies that could help deal with the coming challenge, including the creation of financing programs that encourage millennials and others to purchase first-time homes “so that they have the equity needed to purchase boomers’ homes 10 to 20 years from now,” according to the Tribune.


    But some housing analysts say millennials, generally, don’t favor the large, suburban-style homes boomers own, but prefer smaller, more modern designs in walkable neighborhoods.


    In other words, baby boomers may be selling, but it’s not clear subsequent generations will be buying.


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    “Dolly Parton’s Imagination Library has given away 130 million books.”

    https://www.sandiegouniontribune.com/columnists/story/2019-12-29/column-boomers-will-be-putting-millions-of-homes-on-the-market-in-coming-decades
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  2. #2
    Moderator Beezer's Avatar
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    We need more 55+ communities with affordable, smaller, single story garden homes or duplexes. We need to downsize.

    We do not all need golf courses, tennis courts, megatroplis, communities like The Villages in Florida.

    We need to be able to drive a golf cart to shop and get to Doctor's appointments.

    Frees up existing housing, and get's us into a community with our peers in homes we can afford.

    Start building them! This should be the new construction boom.
    ILLEGAL ALIENS HAVE "BROKEN" OUR IMMIGRATION SYSTEM

    DO NOT REWARD THEM - DEPORT THEM ALL

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