Need To Move Out-Of-State

Unless you are among the very affluent, you need to move out-of-state to make it worth selling your home in San Diego. If that looks inevitable, do it while you are younger and can handle the challenge! Start by going through your stuff – your kids don’t want it and will dump most everything you leave behind.

While the median distance moved in the 2022 Profile of Home Buyers and Sellers was 50 miles, one-quarter of buyers traveled over 470 miles to find their new home. Traditionally, buyers have stayed close to their past homes. From 1989 to 2021, the median distance moved was just 10 to 15 miles.

Based on this generational trend, it is not surprising that those who moved more than 470 miles from their past residence were more likely to be repeat home buyers. Just 11% were first-time buyers. This dispels one potential myth that has abounded in the last year: that first-time buyers are the ones making the move to find their first property far from their rental unit. It does happen, but it is more likely a repeat buyer who is making the distance move.


Silver Glacier

They calculated that baby boomers provided 4.41 million of the 7.74 million homes for sale in 2019 (57%). Now that younger homeowners are locked into their forever home, it’s likely that the percentage of estate sales will rise dramatically – but only because there will be so few sales from other categories. 

Complicating the flow is the amount of surviving spouses that stay in the home. The red band in the graph above looks like it’s around 1/3 of the total number of deaths of homeowners, which means we really need to wait until BOTH boomers die before seeing those homes get into the supply of homes for sale.

This is going to take decades to sort out!


The baby boomers will be riding into the sunset in the next few decades, leaving behind a surplus of houses.

But a study by the Mortgage Bankers Association predicted the impact of the “Silver Tsunami” will be more glacial and easily absorbed by the market.

Edward Seiler, the institute’s executive director and the MBA’s assistant vice president for housing economics, said the study shows a detailed picture of America’s aging population and its effect on the housing market.

“The impact from baby boomers exiting their homes is not insignificant but will happen over a few decades without significantly disrupting the housing market,” Seiler said.

Findings from the report included:

  • “Prior to the COVID-19 pandemic, boomer homeowners numbered 32 million and represented almost 41% of all homeowners.”
  • “The baby boomers eventually will die. Their housing will become available for others or other uses.”
  • “Some estimates suggest that one-quarter of current owner-occupied homes will come on the market by 2040, as older Americans transition out of owner-occupied housing and eventually die.”
  • “Projected deaths rise steadily as the baby boomers age and eventually die, then plateau around 2045. By 2060, the tail end of the baby boom will be 95 or older.”
  • “Overall, housing supply and demand shifts from changing demographics are slow moving and highly predictable, which suggests that there will not be measurable effects on house price growth from population aging and mortality.”
  • “Over the next decade … most of the adjustment to aging and mortality will be through a reduction in the growth of new housing and some softness in the rental market.”
Link to MBA Report

Selling The Inherited Home

Will there be fewer sales in California due to kids moving into inherited homes? Or could there be more sales, due to the high home values and the difficulty of paying off the other siblings? Hat tip to the WSJ!

One of the first things people do when they inherit their parents’ home these days is put up a for-sale sign.

Deciding what to do with a family property is often both an emotional and financial decision, but the rising costs of renovations, property taxes and utilities are making it harder for adult children to hold on to the real estate, financial advisers say. Higher home prices and mortgage rates have often also made it impractical for heirs to buy out their siblings, said Dick Stoner, a Realtor in Rockville, Md.

The high home prices of the past few years have made the decision to sell even more attractive. If inheritors can unload a house in a hot location for a high price, the proceeds from the home’s sale can help secure their finances and fund goals such as retirement, advisers say.

“For inheritors, cash is king,” said Paige Wilbur, Wells Fargo’s head of estate services.

Leaving a home to children remains a common way to transfer wealth, according to financial advisers and estate planners. There is no recent data that tracks home inheritance nationally.

More than three-quarters of parents plan to leave a home to their children when they die, according to a 2023 Charles Schwab survey of more than 700 American investors between the ages of 27 and 95. Some children may be reluctant to sell for sentimental reasons, but finances and simplicity of unloading a property often win out. Nearly 70% of those who expect to inherit a home from their parents plan to sell it, the survey found.

Read the full article here:

Link to Free Article

Blame Bubble on the Millennials Now?

The doomers will love this article but no mention of heirs living in their inherited family home, instead of selling it – which around here should be a significant group:

Millennials are fueling a generational housing bubble that’s set to burst over the next decade as demand for homes falls off, according to researchers.

In a recent report from the Indiana University Center for Real Estate Studies and the Indiana Business Research Center, researchers said Millennials — who are between their mid-20s and early-40s, are in the prime-homebuying age — have pushed up home prices in recent years as demand outweighs supply.

But the situation will start to reverse over the next decade, as Baby Boomers begin age out of the housing market. Meanwhile, post-Millennial generations will be smaller as population growth slows.

That could lead to an excess of housing, potentially pushing down prices and sparking a crash in the real estate sector.

“Plainly put – a generational housing bubble is on the horizon. New housing built now to meet strong demand may sit vacant in a decade. Demand reversal will intensify by the mid-2030s, when the annual number of homes that seniors add back to the market is expected to be 40% higher than current levels,” researchers said.

The could be offset by policies that encourage seniors to age at home instead of nursing facilities, ease first-time home purchases, or boost immigration, the report added.

But population trends indicate that many housing markets will peak in the next decade, it cautioned.

“As Millennials pass through their first-home buying years and Baby Boomers through their last stages of life, the current period of strong demand will transition into a period of slowly declining demand,” the report said. “The industry must adjust current business decisions to this eventual changeover in market conditions or risk substantial oversupply and value loss in the housing market of the future.”

In the short term, industry experts have floated the possibility of a housing rebound over the coming year.

Home prices climbed month-per-month in February for the first time in seven months, according to the Case-Shiller data, and Goldman Sachs predicted prices could stop crashing as soon as mid-2023.


Going To All-Cash Market?

How bad could it get? What else could happen?

The market could deteriorate into a cash-only environment, where the buyers and sellers who can avoid mortgages altogether are the only players left.  If mortgage rates get into the 7s and 8s, the temptation for financed buyers and sellers to wait it out will be overwhelming.

Sellers who are downsizing/leaving town are home buyers who won’t care much about mortgage rates because the only way it makes sense for them to move is to pay cash for their next home. Especially those who are older.

There are plenty in this category, thankfully!


Of those who owned their home free and clear, nearly 78 percent were owned by homeowners aged 55 or older. Not surprisingly, older homeowners are more likely to own their homes free and clear. As the Baby Boomer generation, which is larger than any generation before it, has aged, the share of homes owned free and clear has increased. This gives some hope that while many existing homeowners remain rate locked-in, there is a large cohort of older homeowners who are not. However, older households are typically less likely to move than younger ones, which is especially true as seniors today increasingly age in place. So, while some portion of the free-and-clear inventory will come to market in the next decade, it will likely trickle in slowly.

Free-and-Clear Homeowners May Hold the Key

As demand for homes starts to inch up as we approach spring home-buying season, a key question is, will there be more inventory for those potential home buyers to buy? Existing-home inventory makes up the bulk of available home inventory, and many existing homeowners refinanced into sub-3 percent mortgage rates over the course of the pandemic. But there’s a large group of homeowners who are not deterred by higher mortgage rates—those without a mortgage on their existing home or those with a small remaining balance. These homeowners may hold the key to unlocking more supply and, in turn, more home sales.


Local sales recently have been purchased all-cash about a third of the time. As sales drop further, the percentage of all-cash sales should end up at half or more of the total sales – and help to provide a floor.

New Senior Homes in SD

Ok, ok you want to downsize but you don’t want to bake in the desert – plus you like living in San Diego. Aren’t there any newer, smaller choices around here?

Lennar has purchased three local golf courses and are on their way to building them out. The development of the Carmel Mountain Ranch golf course off the I-15 freeway (above) faced some resistance from the locals, but they beat that back and a gated senior community is now underway.

The Junipers is a senior community (55+) in Rancho Penasquitos and will include a mix of 455 single-family detached-homes and townhouses for sale. There will also be 81 attached homes for rent for low-income seniors households. It will include a 2.87-acre public park and a 2.82-acre loop trail.

Pricing isn’t out in the open but I’m guessing it starts just under a million.



Another new-home development is called the Farm, and it’s right off Rancho Bernardo Road. It isn’t solely for seniors, but they have a couple of one-story plans.  Here’s a quick tour of their 2,500sf one-story home under construction:

Inventory Watch

There are only 88 pending listings today, which means we are unlikely to get up to 100 sales between La Jolla and Carlsbad this month.

How radically different is that?  Here’s how this month will compare to the previous Januarys of interest:

NSDCC Detached-Home January Sales & Listings

January Year
Number of Sales
Number of New Listings
2023 – projected

Discard all previous assumptions, and prepare for market conditions that we have never seen before.

I might leave this fact on every blog post this year, because it probably matters most:

There are over 76 million American baby boomers. All will be 65 years or older….IN EIGHT YEARS.


Seniors Are Flush

The #1 reason that the real estate market has been in the doldrums over the last few months is because of the inept response from realtors on how to handle it. There hasn’t been ANY real guidance or advice coming from NAR and other industry leaders on what to do, which gives the appearance that they probably don’t have a clue.

But the least they can do is respond to doomers leaving unsubstantiated teasers on your twitter account.  This guy is begging you to respond, and you just let it go?  Have some guts and reply with something that forwards the conversation…..please!

I’d respond with this:

The baby boomers own most of the homes, and 91% of them aren’t interested in accessing their equity, let alone moving!  There isn’t going to be a flood of boomer liquidations, though I hope it comes some day.  While there might be some minor outbreaks in 2023, for the most part, seniors are going to age in place and chuckle at the real estate mailers that promise instant riches.

Headscratcher Of The Day

No surprise that our new listing found a buyer already. The one-story homes with all the extras are probably the most attractive buys in the marketplace, and anyone can sell these – it’s just a matter of who can get what price.

I had 200+ people attend the open houses last weekend – and at least 90% of the people were seniors.  Yet, NONE of them submitted an offer.

Think about that!

I thought this home would be a perfect match for those who are getting older and want to get out of their two-story home. Those looking to retire here and want a pool for the grandkids. Anyone fitting the typical downsizer profile.

While there were plenty of lookers, none of the seniors made an offer. Why?

  • Are there hundreds of seniors just beginning their search?
  • Are there seniors who thought they were legitimate buyers but couldn’t pull the trigger fast enough?
  • Are there hundreds of seniors passing on the third one-story offering in this tract this year because of price? Anyone who lives nearby can sell theirs for a similar price and take their property-tax basis with them, so it’s just a swap of equity so why would price be a mental barrier?
  • Is it the perceived difficulty of selling one and buying another?
  • Are they just happy enough in their two-story home, but have a natural curiosity about living in a one-story? Is moving to a single-level just a nice idea?

Most of the attendees were getting around fine – there were just a couple of old guys limping around. My theory is that living in a two-story will be tolerated until the very end, and if it gets bad enough, you can always sleep on the couch downstairs!

What do you think?

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