During the 1960s and 1970s, baby boomers were known as rebels. With time, they evolved into reasonable adults who overtook the real estate market. However, with age, these people are holding onto their homes much longer than previous generations. Since they are slow to downsize, the market is experiencing a shortage of listings and high prices.
Traditionally, when children leave their parents’ home, mom and dad purchase a smaller house, condo, or apartment. Baby boomers are breaking the mold and are holding onto original properties for longer periods of time. If you are looking to buy a new home, this is bad news and may have you feeling the squeeze of rising prices and rents. Although “boomers” are not creating imbalances between price hikes and home shortages, they are playing a vital role in the situation. Other factors include the lingering effect of the housing bust of 2008. Thanks to this event, many people are still rebuilding and postponing moves.
Economists are also analyzing the feedback-loop effect that is facing baby boomers. Even individuals who are interested in selling face a market with few listings and high prices. This makes it difficult to downsize to an affordable and enjoyable home.
Luckily, many real estate experts feel a change is on the horizon. The quandary of the baby boomer generation is only temporary. It is impossible for this group to hold onto their real estate forever. When the market takes an upward shift, these individuals will begin moving. These actions will have a positive effect on the industry and help establish a solid market recovery.
