The Great Senior Sell-Off Could Cause the Next Housing Crisis
What will happen to empty-nesters when no one wants their nests?
Demographers often describe the baby boom generation as if it were an indigestible mammal – maybe a pig, or a rabbit, or a really big rat – slowly moving through the python that is America’s population. As this generation has aged, the baby boom bulge has remade society in its image, first as a massive class of toddlers, later as rabble-rousers in the 1960s, then as solidly middle-class heads of household and, soon, as the largest class of retirees the country has ever seen.
Along the way, this generation has also left a physical imprint on the American landscape with potential impacts as long-lasting as many of the social changes boomers brought. In the 20 years between 1990 and 2010, these consumers were at their peak family size and peak income. And suddenly, there was massive demand in America from the same kinds of people for the same kinds of housing: big, large-lot single-family homes (often in suburbia). In those two decades, calculates researcher Arthur C. Nelson, 77 percent of demand for new housing construction in America was driven by this trend.
Looked at another way, he adds, in all that time “there was virtually no demand for starter homes.”
In the coming years, baby boomers will be moving on (inching further through the python, if you will). “They will want to sell their homes, and they’re hoping there are people behind them to buy their homes,” says Nelson, director of the Metropolitan Research Center at the University of Utah. He expects that in growing metros like Atlanta and Dallas, those buyers will be waiting. But elsewhere, in shrinking and stagnant cities across the country, the story will be quite different. Nelson calls what’s coming the “great senior sell-off.” It’ll start sometime later this decade (Nelson is defining baby boomers as those people born between 1946 and 1964). And he predicts that it could cause our next real housing crisis....MORE
