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Category Archive: ‘Boomers’

Selling to Millennials


Generally speaking, boomers who bought homes to start families purchased what their budgets allowed and fixed them up over time. Nothing could be further from the minds of typical Millennial buyers.

For the most part, Millennials are looking for the finished product and will pay for it. They want what they see in magazines — nothing less. They don’t seem to view themselves living in any one place for a very long time, so there’s no time for gradually rolled out home improvements.

The bottom line: To capture the highest selling price, undertake some key home renovations before listing your house for sale.

Read full article here:

Posted by on Nov 4, 2015 in Boomers, Jim's Take on the Market, Thinking of Selling? | 0 comments

Millennials’ Housing Worries

Millennials will undoubtedly “drive the growth of aggregate housing demand’.

But at what price?

We’ve already agreed that the majority of baby boomers will be fine, and age in place.  After their demise, the disposition of the house can be debated, but it’s really the same argument.  The heirs who are comfortable will keep the family estate to occupy or rent, and the desperate heirs will sell it.

Apparently there are about as many millennials as boomers – roughly 75 million.

Will there be as many millennials who are ready, willing, and able to pay today’s prices – or most-likely higher prices – to soak up the supply of desperate homes being sold?

Below is the latest chart on how they feel.  About half (56%) are worried about the cost of housing – at least they are paying attention.

What about the rest?

Either the other 44% plan to be rich and don’t worry about the cost of housing (in which case we should be covered)…..or they have already given up hope.

Click on image to enlarge slightly.


Posted by on Oct 14, 2015 in Boomer Liquidations, Boomers, Jim's Take on the Market | 4 comments

A Million More Should Do It

Some disagree with my idea that, while the majority of baby boomers will be fine, there will be a group that is financially restrained and will need to sell their house.

Richard Green is a USC ivory-tower guy, so he obviously knows his stuff.  He chimed in on twitter, and cited his report that mentioned:

The massive demographic shift will not result in another housing crisis.

This is because the educational and income levels of the current and future seniors are relatively higher than before, leading them to consume more than previous generations. Also, the size of the Millennial generation will drive the growth of aggregate housing demand, although the growth of per household housing demand may be relatively modest.

He doesn’t just make this stuff up. He also includes formulas to prove his case:

so there

So there you go – nothing to worry about.

A likely scenario is that any future home sellers will get bailed out by the newcomers.  According the SANDAG projections, there will be another million people moving to San Diego County!  Yippee!


Posted by on Oct 14, 2015 in Boomer Liquidations, Boomers, Jim's Take on the Market, The Future | 9 comments

Boomers Survey

This survey is dated 2014, and they should update it every year – or at least until I’m right about having a boomer liquidation sale coming down the pike!

This survey asks several different questions, but notice how 20% to 30% of the responses seemed to divulge some stress or uncertainty about their future:




Uh-oh.  It looks like this homeownership thing could be a boomer addiction:



It’s still early in the game for most boomers.

But here’s where the game changers start to come out.  Only 58% don’t plan to sell?  Fine, they aren’t going to make the market – it’s the other 42% that will determine our real estate future:


Fluff question below – of course we like our home, at least until selling it becomes a better idea:


Almost a quarter of boomers know they are already short on income, and will be hitting the housing ATM.  How many others who didn’t expect to use their equity in 2014 will eventually need to cash out for various reasons?


Here’s where the real trouble starts below – 46%???





The best question towards the end of the survey once respondents have loosened up – and lo and behold, 61% of boomers aren’t sleeping that well.

If it only ends up being 20% to 30% of boomers who make a move, that’s still at least 15 million people in America who will be deciding our market!

The biggest concern?

Elderly folks who haven’t moved in a generation (or two), who know their money is running out and happen to see a couple of lower-priced sales nearby.  In a effort to bank as much equity as possible, they hit the panic button and grab the first realtor they find who then dumps their house for 95% of value.

It’s a downward spiral that could pick up steam quickly.

Posted by on Oct 12, 2015 in Boomer Liquidations, Boomers, Forecasts, Jim's Take on the Market, Thinking of Buying?, Thinking of Selling?, This Is America, Why You Should List With Jim | 19 comments

Boomer Liquidation Sale On Hold

The baby boomer liquidation sale has failed to materialize….so far.  Boomers are holding onto their old homes longer, and living the good life instead:


Baby boomers are not leaving the homes they own to settle into apartments, as housing economists had predicted.

A new edition of Fannie Mae Housing Insights says that boomers are not responsible for a recent surge in the apartment market. But when they do finally downsize, the very size of the generation will be enough to “move markets.”

Predictions were that boomers, the generation born between 1946 and 1965 (some sources say 1964), would begin downsizing naturally as they became older and more frail. “The research showed that the likelihood of Baby Boomers occupying single-family homes has changed little in recent years, despite the factor that boomers are experiencing major life changes that might be expected to cause a downshift in their housing consumption,” the Fannie Mae article said.

Instead, through 2013, boomers had not significantly reduced the rate at which they live in single-family, detached houses, the agency said. And although the number of rooms in those houses has decreased in recent years, “boomer home size has increased since then, suggesting the boomers are not trading down to smaller single-family homes, either.”

The article added that the “number of boomer apartment dwellers has not budged in recent years, whereas the number of millennials in multifamily rental units has grown by nearly half a million annually.”

That’s a significant finding with big implications for the housing market, because “boomers have an enormous residential footprint.” Some 40 percent of the nation’s homes are occupied by boomers, who have “half of the nation’s housing wealth,” Fannie Mae said.

As baby boomers move into their retirement years, they’re having a major impact in other ways, too.

“After working most of their lives, Baby Boomers want it all in retirement: travel, dining out, owning two cars and multiple homes. And they want to do this off of income generated by their investments,” said a recent article in Wall Street Daily. “Yet you’d be amazed how many people go to see an advisor with far too little in savings or investments to enjoy that sort of retirement. Even those people who have enough assets often have them allocated extremely poorly.”

Some boomers have accumulated no savings for retirement, the article said.

Read full article here:


Posted by on Aug 31, 2015 in Boomer Liquidations, Boomers, Jim's Take on the Market, Market Conditions, Thinking of Buying?, Thinking of Selling? | 11 comments

Baby Boomers Downsizing?

The baby boomer liquidation sale isn’t panning out just yet.  There are boomers buying a bigger homes to house multiple generations, and there are those who want to enitce more visits from the grandkids.  From

Homeowners’ post-recession fling with smaller dwellings has fizzled, and Baby Boomers aren’t downsizing as expected.

Real estate site Trulia found that 43 percent of more than 2,000 online survey respondents want “somewhat” or “much” bigger homes than their current residences. This might be expected among younger adults with growing families — more than 60 percent of respondents under 35 want a bigger home — but even their parents still feel cramped.

Although Boomers are most likely to be satisfied with the size of their current homes, the conventional wisdom that these empty nesters would downsize to smaller homes later in life turned out to not be the case. “It is a bit contrary,” said Trulia housing economist Ralph McLaughlin. “According to our survey, we are finding that almost as many of them want larger homes.”

While 21 percent of Baby Boomers want a smaller house, the highest percentage of any age bracket, the number who still want to go bigger is five percentage points higher. Last year, Fannie Mae noted that Boomers displayed no hurry to trade in their houses for retirement condos.

“It is pretty surprising,” McLaughlin said, adding that there are probably multiple explanations for the enduring preference for bigger homes. Retiring Boomers may be moving out of urban areas and into communities where they can get more square footage for their money. They might want larger spaces so their kids and grandkids can come visit without feeling cramped.

Or, they might not want to give up their toys just yet. “It could also be the case that Boomers are also going to stay more active and need space for all the activities they stay engaged in,” McLaughlin said.

Posted by on Mar 10, 2015 in Boomer Liquidations, Boomers | 17 comments

Surge of Boomers Retiring

Did everyone have a nice day off?  Great, let’s get back at it! From John Burns:

More people were born in the 1950s (41 million) than in any other decade, and they are dropping out of the workforce in droves. Those born in the 1950s will begin turning 65 in 2015. In fact, in the last 10 years, we have transitioned from roughly 2.5 million US residents per year turning 65 to 3.5 million per year, and that number will trend up to almost 4.5 million by 2025 before it starts trending down again.

boomers graph

This seismic shift will have a huge impact on the economy, as the traditional working age population of 20-64 will transition from growing 1.0 percent per year for decades to growing 0.25 percent per year. 20- to 64-year-olds earn and spend the most, so you can almost guarantee that the economy will grow more slowly than it has in the past.

While the economic growth will  be slower than usual, and the burdens on Social Security will skyrocket, entrepreneurial opportunities will abound to serve an unprecedented surge in retirees who, by the way, also happen to be the most affluent retirees ever.

My big idea for 2015 is to plan for a slower growing pool of workers and to take advantage of the surge in retirees, no matter what your  business.

Here is a nice clip from CNBC discussing the success home builders are having targeting retirees, even in non-traditional retirement markets such as Atlanta:

Posted by on Dec 26, 2014 in Boomers, Market Conditions | 10 comments

Born To Be Wild?


Doesn’t there have to be a segment of baby boomers who are looking for adventure, and want to head out on the highway?  If so, will the warmer-climate San Diego be a net gainer, or loser?  If there is a senior exodus to free up money and lifestyle, it would make sense that the more-expensive areas like Southern California would see more seniors leaving.

From the

When is a house your safe haven and when is it standing in the way of richer life experiences?  That’s the question more and more retirees are asking these days.

Take Barbara and Mike West and Joseph and Phyllis Applebaum, retirees and longtime Maryland residents.

After years of analyzing their financial situation, the Wests decided to put the mortgage-free suburban house they had owned for 26 years on the market. They wanted to avoid the mid-Atlantic winters and considered moving to Hawaii, where they had lived while Mr. West was in the U.S. Navy.

But they decided it was too remote. They also ruled out San Diego, Savannah, Ga., and Charleston, S.C. Florida, they decided, was a possibility.

They considered renting their Maryland house out for part of the year, yet the idea of storing some of their household goods and someone else sleeping in their bed changed their minds.

Of the decision to sell a mortgage-free home, Barbara West, 63, said it would give them a chance to dream and to explore. Besides, “It’s a lot of money locked up in the house,” said Ms. West, who retired from her job as a lobbyist two years ago. “It’s a nice side benefit. It will free up money. We’ll have more flexibility. We’re kind of looking at it as an adventure.”

Read full article here:

Posted by on Dec 19, 2014 in Boomers | 8 comments

Boomers Upsizing

From MND:

An excerpt:

A survey of attitudes toward housing released on Thursday by The Demand Institute indicates that the Baby Boom generation still has no intention of aging gracefully.  In fact, when it comes to housing it appears few intend to yield at all to their advancing years.

The Institute, a nonprofit run by the Conference Board and the Nielson ratings people, surveyed 4,000 households last year in which residents qualified as members of that huge post-war generation born between 1944 and 1963 about their future housing plans.

The survey found that as a group Baby Boomers had a median net worth of $200,000 in 2007 and were on their way to accumulate nearly $370,000 by 2013.  Instead the recession sent many off the rails and at the time of the survey that median net worth was down to a median of $143,000.  Although many Boomers have delayed or modified their plans due to the recession they have, the Institute says, not abandoned them entirely.  Over the next five years it is expected they will spend $1.9 trillion on new home purchases and $500 billion on rent.

Read full story here:

Posted by on Nov 2, 2014 in Boomers | 5 comments

Estate Sales

We’ve explored a few of the alternative groups of potential sellers, but none are emerging as major contributors.  In a ‘normalizing’ market, it means we are back to the Big 3 sources of new listings; Death, Divorce, and Job Transfer.

Carmel Valley doesn’t have much to worry about here – the oldest CV homes were built in the mid-1980s.  But in the remaining areas of San Diego’s North County coastal region, where houses go back to the 1940s and 1950s, there are many long-time owners who will stay for the duration.

Back in the old days, it was routine to sell your parents’ home and split the proceeds with the siblings.

But that was when everyone could afford their own house.

Today, one of the siblings might want, or need, to take possession because they can’t afford these prices.  As a result, what used to be a steady flow of new listings may not be as fruitful as before.

It will be relative to the quality of the home.

Yesterday I was in Oceanside, where a past client had purchased in the 55+ community of Oceana.  I had sold her house about 10 years ago, and she moved there with her husband thinking it would be the final stop.  It was for her husband, but now she needs assisted living, so she is exploring those facilities.

Oceana is an average senior community – the homes are 1,000sf to 1,600sf and sell in the $200,000 and $300,000s.  Sales are increasing – here are the number of closed sales between Jan 1 and Sept 30:

2010: 57

2011: 57

2012: 50

2013: 69

2014: 66

There are 22 active listings today, which is no shortage of supply is you are thinking of living there, and it is an affordable option.

But in the swankier parts of town, when a homeowner dies, their home is more likely to stay in the family today just because the siblings having such a difficult time buying their own home.

The condition of these homes is usually less than spectacular, and those that do come up for sale will be great flipper food.  You’ll see more of them in areas where homes were built in the 1960s and 1970s, because those original owners have had no better place to live for the money!

Posted by on Oct 29, 2014 in Boomers, Jim's Take on the Market, Market Conditions | 15 comments