June 16th, 2014
A lot of attention has turned toward the housing habits of baby boomers as many in this generation reach traditional retirement age and exit the workforce. Earlier reports have shown that many favor all-cash home purchases rather than getting another mortgage during their golden years. While their preferred financing is already understood, which type of property fits their needs?
Fannie Mae reported that many baby boomers - who were born between 1946 and 1964 - are prepared to stay in a single-family home during retirement. For years, the perception has been that retiring individuals drop their larger suburban properties in exchange for smaller, urban multifamily residences once all of their children have finally moved out. However, the nearly 10,000 boomers who reach retirement age every day have different desires.
“Despite these life transitions, one key metric of Boomer housing consumption – the proportion of the population residing in a single-family detached home – has yet to decline,” the report said. “In fact, contrary to the downsizing perception, the percent of Baby Boomers residing in single-family detached homes was at least as high in 2012 as at any time since the onset of the housing crisis.”
Why are boomers hanging on to larger properties
According to HousingWire, there are three reasons this generation has changed the trend:
Given these factors, boomers may not be as much of a force in the housing market as previous reports would suggest.