a Mini Housing Boom
Baby boomers, the generation of people born between 1946 and 1964, are suddenly reentering the residential real estate market in a very big way. It looks like the folks who brought us Woodstock, The Dating Game and disco are once again in the forefront of yet another major cultural trend. Only this one is sure to have much longer lasting implications for the rest of the country than Pet Rocks ever did.
According to the National Association of Realtors, more than 20 percent of the homes purchased last year were bought by people over 55. This is up from just 13 percent in 2001. Today, nearly a quarter of this demographic group owns either a vacation home, land or a rental property in addition to a primary residence. Several factors are driving this trend; perhaps the most important of which is that many members of the Baby Boom Generation have both the financial resources and the vision to take advantage of the great real estate values created by today’s reduced prices and low mortgage rates.
Real estate experts see this trend continuing for some time. Many baby boomers, especially those in the pre-retirement mode, are in the market for transitional homes where they can vacation now and then settle into after they leave the workforce. Others are interested in homes that better fit an empty-nest lifestyle. Surveys by the National Association of Home Builders and the MetLife Mature Market Institute show that this market segment is particularly interested in single-story houses with smaller floor plans and special senior-friendly amenities like nonslip floors, larger medicine cabinets and lower kitchen cabinets. Still another group of boomers see investing in real estate as a smart way to rebuild the savings and home equity they lost over the past couple of years.
Whatever their reason for buying, baby boomers are once again a major force in residential real estate. Their presence is breathing some much need life into the U.S. housing market.
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