Baby Boomers Staying in Their Homes Longer, Disrupting Real Estate Markets

Wow. The real estate market doesn’t have enough inventory for young people and it is my (Boomer) fault! That’s the best one I’ve heard this week. We went to look at new patio homes locally and found that downsizing meant upsizing square footage and almost doubling the price tag! The new townhomes were worse, one had FOUR floors. I could see Russia from the master bedroom. Yes I like my small yard, and the fact that I don’t hear my neighbors on their phones or smell their cooking. I don’t want to be restricted to one dog under 25 pounds. I don’t want a moronic HOA whimsically directing my life. Maybe the real estate industry should prod developers into building less McMansions and focus on affordable small “starter” homes. But no, developers want the biggest bang for their lot. I guess the next article will focus on a study about Boomers sucking up all the fresh air on the planet because we’re not dying off fast enough.

Huh? I just read where the younger generations dont want to buy houses preferring to rent or live in townhouses where they dont have any maintenance to deal with and those who do what to buy only want new. Also have read that the younger crowd dont have "growing broods", rather many are choosing not to have children or only have one child; government demographic data does show a drastic drop in birthrates. If any market is being disrupted buy boomers not moving from a house they might have lived in for a while it's probably the "flipper" market.

I have to agree with the article about the reasons Boomers aren't selling. Pretty much all of these are why we decided to stay in our 2900 sq ft home despite the master being on the upper floor -- besides, we like the view. What we would give up to move wouldn't be worth what we would get. Add to that: we MADE of this place what we wanted -- really difficult to replace.

And I also agree with the sentiments of both Daryl and Jean. The realtor market's failure to adjust to a changing demographic does not fall on the shoulders of Boomers. Anyone who thinks things will always be the way they start off is doomed for disappointment.

Comments to which Millennials might say: "OK Boomer". It is the newest slur on baby boomers from the younger generation, who think we have a habit of pontificating. Steven Colbert even did a skit on it.

Now that our millennial children are "adulting", my wife and I downsized from a 3,300 sq ft 2-story, 4-BR home to a 3 BR ranch home. We didn't down-size financially since it was a rehab in a desirable downtown area but it cold be our forever home in the town we have lived for 36+ years, we have many friends here, and its close to the majority of our families. Millennials are having a hard time finding affordable housing in many area because many are are saddled with large college debt (fortunately, not our kids) and allegedly low-paying jobs (not if they made good education and career choices). The real reason though my wife and I (and many Boomers) are staying put is we slowly "moved up" in housing careers during our own adulting years to be able to afford to spend many years living in a great town that has all the amenities we want. Hopefully, Millennials will be able to do the same. Sure, interest rates but are not nearly as high as when we first bought (our first mortgage was 13%!). Like the story of the tortoise and the hare, its a long race, not a sprint!

Another problem is the effect of Prop 13 in California. People who bought their houses years ago pay property taxes at a much reduced rate that is nowhere near what they would pay if they downsized and bought another home in the same area. My friends in the Bay Area are all staying in their homes for a couple of reasons - capital gains tax on houses they purchased in the 70's (I have friends who bought a house for $70k in the 70's that is now valued at over $1.5 mm), and the huge property taxes they would have to pay on a new home. They will probably stay in it until they die and bequeath it to their kids. I wish the voters would repeal Prop 13 but even though amendments may be on the ballot for commercial and industrial properties, there likely will not be any change to property taxes for residential properties. This is going to keep boomers in their homes for a long, long time, adding to the shortage of housing in California.

Editor's Comment: You are so right JoannC. Homeowners love that Prop 13 protects against big prop tax increases, but there are always unintended consequences!

Don't mind moving away. And yes, moving is a huge hassle, to downsize incurs a much higher expense - can't wrap my head around getting a smaller house and 1/10 of the yard and paying well over $150 grand more than what existing home would cost. And yes, been looking five years and still haven't found the right product. Not interested in being able to pass the coffee thru my kitchen window to my neighbor in their kitchen window, not interested in being <50 feet from my neighbor in the back yard or having the 2 car garage be the biggest thing you see when you drive up from the street, one car length away. Not interested in any development that restricts the size of your dog to 25 lbs. Yikes...It would be a neighborhood of little ones running around not to mention barking. Next they will be restricting you to the color of their leash and collar or the times you are allowed to walk your dog. Also, a lot of developers of the 55+ communities still have not embraced the 'curbless shower stall or the zero entry into the house. For many boomers they don't want to have to move again or have to go thru renovating their new house. It's not the boomers, it's the developers and the realtors who are too young to recognize what the boomers want, need or could use. They could try listening to us. And finally must agree, some of the amenity rich communities are a bit over the top. How much does one really need?. And at what cost? The special assessments to maintain or refurbish would be an annual, increasing expense.

This article is both timely and bulls-eye accurate. We've been in our current home for over 15 years - and counting. Every time we look at another community it just reminds us how fortunate we are to be where we are. I agree completely with Suze - especially when it comes to the developers who aren't listening to the boomers and the costs of maintaining amenity richness. Condos with second floor Masters? As some from Connecticut might say.....Fuuuughetabouuutit…. For us this will probably come down to an eventual two location relocation that features comfy winters and cool summers. This publication has a couple of articles about that.

If we stay in our current homes in Maryland, it is because builders have yet to start building the types of homes we desire/need as Baby Boomers. R.E. in Maryland is very high and no one is going to pay top buck for condos WITHOUT elevators or the few condos built with elevators having sky high fees and property taxes. It seems the only place in Maryland with one floor living that is reasonably priced is Hagerstown, MD. Builders there had the insight to build 2 BR/2BA attached ranchers that are priced reasonably. HOA fees and taxes are also lower. Until builders catch on to the huge market they've missed the mark on and start building appropriately priced, sized and close to amenities types of homes, we will stay where we are. So it goes!

I live in California and thank goodness for Prop 13. Before it was enacted seniors were being forced from their homes that they had lived in for decades due to not being able to pay their ever increasing property taxes. If it were ever to be repealed the same thing would start happening again. My comment in regards to JoanneC who said she had friends whose house In California now was valued at 1.5 million. Without prop 13 their property taxes would easily be $150,000/ yr at this point. Maybe they are quite wealthy and could pay that every year. For the rest of us seniors here in California we would have lost our homes long ago

We've been in our home for 18 years and do not think we will leave. We had a winter townhome in Florida but sold it several years ago and decided to stay in Connecticut. Luckily are home has a downstairs master and although we have an upstairs with several bedrooms and bath we live on the first floor. We love our small town, short walk to beach and enjoy the seasons. We thought about relocating to Florida but the never ending heat and humidity, traffic and high costs of moving to and living in an over 55 is too high! You pay realtor fees here and they want you to pay fees to move in! Our taxes are high but worth living in an area that we love! The northeast needs more over 55's with detached smaller homes with downstairs masters.

I agree with most things. Said we’ve had a low maintenance one story home for 30 years and could stay much longer. We are getting tired of all the work In the yard and cleaning it. We’d like a one story two bedroom with everything we need on one floor, it also a basement with two simple bedrooms, another living area and some storage. Having a community room for hosting events would be great. There is t much like that in our town. They are building a new Senior Living facility, but aren’t even asking us what we want.

We recently moved out of a condo due. Condos are only as good as the people that manage them. Honestly for many the highlight of their day was to meet at the mailbox to complain. We’re so fortunate to find a small 1920 bungalow that had been renovated by the previous owners. There is a full first floor bath and an extra room that could be converted to a bedroom if needed. We can walk to everything. I only drive once a week. I know walking our steps is good for my health and balance. I have arthritis and the last thing I should do is give up getting in as my exercise as possible. So we’re staying in our quality built sound proof home. I love hearing children play in our neighborhood. Mentally moving to a 55 and older community would not be good for me.

Why are we to blame, we are expected to downsize in living space, but All our other costs dont change, or go up for less space. And yes, realtors and developers are only interested in how many bucks they can put away after they sell you that 3 story monstrosity with almost everything out of reach. I got tired of listening to my agent telling me to keep lowering the listing price to make my home saleable. She had no answer when I asked her where I would make up the 20+k when I finally sell it, this was on top of putting 13k of "skin in the game" to enhance curb appeal. All she really wanted was "a sale". So I am staying put for now, circling the wagons again to see how I can make it and still cover my bills on SS. And, sorry but it is not my fault the vast majority of younger buyers dont know how to fix or even talk somewhat knowledgable about the repair of anything , and want food in the refrigerator when you sell your house to them...

I look regularly at different states and housing for sale. It amazes me that new homes in places like Georgia, South Carolina, that are not mansions, but 3 bdrm 2 bath homes, how expensive they are! CT, where I live is expensive too but when you leave CT a lot of us are looking for lower cost homes. I don't know who the people are that are buying these expensive homes with HOA's. We built our home in 1975 at the ages of 22 and 23. Our house has been paid off since around 1990. Our taxes are cheaper than a rental. About 5 years ago we put on vinyl siding, new gutters, new deck, new roof, new boiler, new cold water tank and very recently a new pump for the well. My biggest concern is we have a raised ranch and there are stairs. Plus, our bathrooms are very small if we need handicapped devices. I have been trying to think how we could utilize our family room downstairs that we don't use to something useful as we age. There are things I wish I could have but I am also thankful for what I do have.

There is a lot of commentary (complaint) here and to other articles about condos and other 2 - 3 story homes for seniors -- especially those without the master bedroom on the first floor. Most want home single story homes with no stairs to navigate. Ideally, I agree but the fact is that in almost every area being built, the cost of the land affects building decisions. The smaller the home footprint, the lower the initial cost. Condos maximize the lower cost by eliminating almost all surrounding yard. Two and three story standalone homes minimize cost by building a smaller area on top of one foundation. At best you may find a first floor master -- but then how to use upper levels?

Demanding single story, stand alone homes (or even attached single level condos) immediately increases the starting costs. (Just notice how most 55+ communities have single-family homes built on top of each other -- many with barely 5 feet between the houses. If builders offer "apartment" style condos with all rooms at a single level, many buyers don't want to live over or under someone else and still have to use elevators for access. And those apartments tend to be much higher than three stories. The cost of ground floor apartments increases almost as much as penthouse apartments.

So if you want a single story, single-family home, you can expect to pay more or to compromise on what you will accept. While some may call it "greed", it's not surprising that builders produce the properties they do. No one goes into a business to lose money -- most want to maximize profit.

We are currently in a 55+ community in SC. Initially retired in Greenville SC to a large house with 7 acres - how we miss it! When you move into a 55+ you basically give up your independence and have to get approval for each little thing - ugh! To say nothing of the monthly fees - for what? Sub par landscaping maintenance and ignored requests. I feel like I'm living in a nursing home, only the homes are lined up in a row outside with little privacy between them. This was a BIG mistake! We are looking to move to a larger home where I have enough room for everything instead of having to go to the garage cabinet which I had to buy for many kitchen items. I guess I'm lucky since I still do stairs without a problem. I know that can change at any time but I'll deal with it. I guess my point is to know yourself and don't settle because "it's the right thing to do" just because you are older and retired.

When I first saw the original article I was left with the feeling that again we are being blamed for the inability of a younger generation to buy homes, yet in the housing market there at least, there are plenty of homes available and they are selling, just not at prices younger folks want to spend. I do not understand this penitent for having to blame someone for one's situation. The truth is they want a deal and for now, those homes are too costly and not available. They could build but that will cost even more, so the blame is the answer. Poor them! In truth, the longer they save the better home they can get at a favorable price, however this is the same population that has zero in the bank because , IMHO they do not have the fortitude to actually delay their gratification. Regarding our home, we initially went down the path of looking to move to a smaller home once we retired. We sought out homes and locations with all the wish list items aging retires wanted, but after looking in multiple warmer states and at -plenty of communities, we decided that we could do just as well in our own home, and make accommodations as needed when needed. Yes, the house has stairs, is bigger than we need and is in a cold part of the country, but we decided to stay in the right decision now and until things change. I will apologize to the younger folks now, our home is not available unless of course, you want to throw a boatload of money at us to make us want to move.

We WANT to downsize and move to a no-maintenance rental. We have looked all over the U.S. but the 55+ communities mostly offer small square footage and unattached parking. The vast majority include meals which we cannot eat per doctor's orders. When we have found a rarity that fits, there are
years-long waiting lists. In short there are NOT ENOUGH OPTIONS TO MOVE TO, so we stay put, even though we are burdened with a big, old house where we no longer want to live and can't take care of anymore.

You’re right, Mary, and which generation should we blame for our predicament? Unfortunately for advertisers, we’re no longer part of any desirable demographic because we’ve learned to resist the siren song of sales. We tell them what we want, they tell us what we should want, then guilt us for not giving in. Despite the raised eyebrows of our more ambitious friends, our “starter” home turned out to be the perfect retirement home. So there. Now if I could just pick it up and plop it on a beach...

I read another article yesterday in regard to the baby boomers staying in the workforce too long which delays the younger generation moving up to higher positions in corporations. Yet, we boomers are told to stay in the workforce to bump up our Social Security. That is if you don't get laid off in your mid 50's during a reorganization only to hear they hired people months later and of course not boomers.
Getting back to downsizing. I have thought a lot about buying a brand new mobile home for cash and after selling my house I would be able to bank a lot of money. However, I have a friend who lives in a MH and pays around $550 a month lot rent. That is $6,600 a year. My town taxes are less than that and I don't have a mortgage. The value of my home keeps going up and a MH value goes down. I don't really care too much about that because I have no children to will my home to but, seems foolish to live in a MH to pay more rent than I do in taxes. Plus, there is danger of the park being sold and your only choice is to move the MH or possibly abandon it. Most MH's are meant to be moved once, from factory to your lot. It costs a lot to move them too.

Many have commented on the cost of current housing. We have found that in most of the communities where we might be interested in living, the "flippers" have been there before us. We look at the real estate listings and see that a house that sold for $200,000 recently, will have been held for less than a year and then placed on the market for $400,000. A little renovation may have been done (granite counters, laminate floors, and stainless steel appliances), but certainly not enough to justify doubling the cost. Does this sound familiar? It sounds a lot like the bubble of the early 2000s to me. I think many seniors, like us, look at this market for what it is, an overheated market which will likely crash in the future. We will sit tight until the prices become realistic.

I'd be curious to hear from others what price per square foot, used homes, compared to new construction are selling for around the country. In MN, it was difficult to get $100. PerSF for used in any condition, or grade. Yet a new build would run over $150. PerSF, and rising, for construction grade (blah). Same thing in TN. Then add, Lawn establishment and landscaping .......cost double what we had expected. Then there is the dock!!! Holy cow!! So much for the travel while were still able. Thankfully, this is like a vacation spot in many ways. No regrets.

We most likely are going to rent or purchase a park model single wide mobile home. This is in Southern CA closer to the desert where you own your land and the HOA is only $185 per month but that includes cable and basic utilities. The homes sell starting at $79000. Sq footage avg is around 700. We have 3 cats and need to downsize to make it work, but you would have more money left over every month if you can change to living minimally.

BruceB, I had to laugh at your comment: "I will apologize to the younger folks now, our home is not available unless of course, you want to throw a boatload of money at us to make us want to move." Every couple of months we get a call offering to evaluate our home for an immediate cash buy. My response is, "Sure, we'll sell -- for $1M." Not appraisal value, but value to us! Short of building another, our home is too unique and custom to find another approaching it. All electric, passive solar with electric bills less than $200/month average is rather hard to beat! We'll handle the upstairs master -- with a view. We considered going where it's warm (ala Jimmy Buffett), but decided NC will do us just fine.

This has been a great discussion, thanks to everyone. Let's keep it going!

PS - we got a couple of great comments about Manufactured Homes on this topic, and they were so good that we created a new post where they will fit a lot better! You can find them at https://www.topretirements.com/blog/real-estate/have-you-considered-living-in-a-manufactured-home-pros-and-cons.html/

The article does not say post-boomers are blaming us for not moving. It says the real estate experts have seen their old housing turnover models “disrupted” (read: changed) with boomers holding onto their homes longer. This may be, but a strong economy and limited home building within commute distance of job centers is a bigger driver of exceptional price inflation than lower boomer turnover, I believe.

I don’t know what’s being built around the rest of the country, but in our neck of the woods not one single new home is 3BR ranch/cape cod/ bi-level with lot similar to our choices when we married. The minimum price for new homes here are 7 times what we paid, nowhere near the quality, and I don’t think our incomes would have risen sevenfold to purchase even these. Articles have been written in the local papers about people begging for new affordable developments. Photos I’ve seen of these 55+ starter models in retirement communities are depressing fluff, and the spacing between homes looks like a dog kennel. Somebody is not doing their job well or sensibly. And why no new manufactured home developments? One (ONE!) manufactured home 55+ development built near here over 35 years ago is still a well-maintained raging success.

The housing industry is no different from the stranglehold of Big Pharma on our drug prices, promotion of autos to the exclusion of trains (Big oil?), and crap food drowning out the wholesome stuff (add here Big Ag and the other players.) I’m sick of all the excuses, and so are all the seniors I’m hearing from.

Mary,
Where in Southern California are you looking to buy your mobile home? What city and development? Any concerns about the water resources running out there?

Cindy,
There are several RV/park model RESORTS in Riverside County. We are putting an offer today on one in Mountain Shadows which is located in Hemet CA. That's 40 minutes south of Palm Springs and 1.5 hrs from San Diego. After paying cash for the home we can pretty much live off 1 SS check. There are other communities where you own the land but you're not in a park. In Sierra Dawn you get more land and the HOA is $123 including free expanded cable and offers many activities. Homes there start at $75000. Either one of these only allows 1 pet though. I havent heard of any water concerns....

Thank you Mary. Sounds very affordable and sunny too!

I find others comments so interesting. For me I just past my 1 year retirement aniversary and always thought I would be in Florida the day after I retired. I have researched and visited places and researched some more over the past year. Even had an idea of becoming a van dweller and driving to see my children in 3 different states. Over this time I have found that my children all have their own lives and routines and except for watching my grandchildren do the parents can do things, I do not see much need for me to be around. I own a condo that is mortgage free, has a small HOA fee and is in Upstate NY. With the fires in California, the hurricains in Florida and the Carolinas, I no longer feel that dealing with snow is the worst I can have. My only draw back is my condo is a 3rd floor walk up. I am doing everything I can to keep my ability to climb the stairs and of course I have to avoid injurys which a recent fall reminded me of. I hae decided to stay and when I can no longer make it up the stairs, that is when I will sell and just rent . I figure when I can not get up the stairs I will most likely have other health issues. Well that's my plan.

55+ communities have extremely limited options for us as we have two dogs. If we find a community that allows fences and large dogs we usually are not allowed in due to breed restrictions. I do AKC obedience competition with my dogs. So we have written off 55+ communities in our home search.

Kathy P. Same here - I have three small dogs and need a fenced back yard for them. So many adult communities in various places around the country don’t have fenced yards and some allow only two dogs. I’m looking for a new house now and so far I think I’m going to end up in suburbs because of the dogs. Not my first preference but the dogs need to be considered in any decision.

Like many of the others who made comments, we're strongly leaning towards staying in our home of many years for much the same reasons. We don't want to pay far more for a home with much less space (the value of our house has tripled). We don't want an HOA, we don't like the very small places and nearly zero lot space that goes with them that we're seeing the 55+ encampments. We don't care about the amenities offered either. We've worked hard for the things we have, including our home, so we're not going to feel guilty about wanting to keep it. Since when do we need to consider where someone else (of any age) might want or "need" to live as a part of our decision-making process?

I'm a Boomer, retired 7/1/19. I live in a good section in NY and I'm not moving anytime soon. My autistic brother lives with me and I can't see disrupting his life just to move somewhere else. I would like to move but I love my little house. I bought it for $126K and homes in my area are selling for $700M+. I'm near everything. I got rid of my car since the buses run everywhere. I'm near all the airports, highways, shopping, medical, everything. I feel really lucky. All my kids live in other states and I visit often but I like coming home. We've worked hard to be where we are and as we age we want to be albe to maintain our independence as long as we can. I enjoyed reading all the comments on this thread. You guys rock!

I debated and looked at different 55plus developments over many years before deciding to sell and move into a small new development. There are many in this development that have fenced yards and large dogs, so that does not appear to be an issue in this particular development. My decision was based on several factors: I did not need a large house where I lived in 3 rooms of it, constant major maintenance on an old home, yard maintenance I did myself (could not afford the prices charged in my area by landscapers/mowing folks) on a large lot, property taxes that more than doubled in 1 year and were scheduled to increase again, location having increasing amounts of crime and horrible traffic with no solutions in sight, changing neighborhood where young couples move in and erect 7-foot privacy fences so you do not see your neighbors for years. Just pointing out that there are a lot of factors to consider when deciding whether to stay or leave your home of many years, and home price is not always the deciding factor. If you decide to remain in your home and things like property taxes and upkeep make it unaffordable, you might as well move to where you can afford to live.

Some of the above comments really hit this on the nose.

First of all, realtors are motivated by the hope for big commissions, not altruism. Case in point: our house is now valued at $825K, and local realtors expect to scoop up almost $50K in commission. How DARE we deny them this money by not selling!

Sure, we'd like to downsize a bit, but have yet to find a home that offers a compelling enough reason to leave this one. Ideally we'd like 1800 SF, 3 bedroom, 2 baths (including a roomy master suite with large curbless shower), large kitchen, dining room, and fair sized living room. No stairs. No HOA or 55+. Good luck finding it.

On an aside, I think 6% real estate commissions are outdated and little short of highway robbery. Houses priced properly sell in less than a month (a week in hot markets), plus most serious buyers do their own legwork using Zillow and Realtor.com. Realtors do far less work than in years past, and let's face it - the amount of time and work to sell a $200K house isn't appreciably different from that of a $1 million dollar house, but the commission difference is $12K versus $60K.

A point of correction about California and Prop 13 taxes. In 1986 two additional pieces of legislation refined the laws that inadvertently kept homeowners stuck in houses that preserved their established low real estate tax bases

Prop 60 permits homeowners over 55 to transfer the assessed value of their present home to a replacement home if the replacement home is located in the same county, is of equal or lesser value, and purchased within 2 years of sale.

Prop 90 permits the same transfer of assessed value to other counties, presuming the incoming county permits the transfer (many do).

My wife and I are going to be selling our 3000 plus sq. ft. home on a really pretty little lake in South Carolina soon to move to a 55 plus community in AZ. While we love living here on the lake, once I retire I'll go crazy with boredom without having a job to go to! I just have never been able to learn to like to fish and yard work is just a chore to me not something to be enjoyed. I need the amenities that a 55 plus community has to offer and the HOA fees are a fair price to pay for a happy life!

We lived in a 1500 sq ft; 2 acre home for 32 years and upsized to a bigger 3000 sq ft house, .5 acre lot closer to Boston 4 years ago to be closer to my husband's job. We both work full time and bought a home we always wanted--a traditional New England Colonial in a cul-de-sac. One daughter moved in with her husband and newborn 10 months ago so we could help with the baby. A second daughter hopes to move in with her 18 month old in the spring. I welcome living with my kids who both owned homes and want to sell them to live with us. It will be a bit chaotic at times. But I would rather have family in my life daily than being a grandparent that is visited a couple times of year. My kids all make very good money--over $200K but that is not the point. The daughter who lives with us now says it's "fun" to live together. They do not pay rent; we do not need their money, but they buy food, cook, and clean. We will probably retire in 4 years at ages 70 and 77 which will allow us to winter in Florida for a couple months and get away from the winter for a nanosecond. This lifestyle is not for everyone but we have an African-centered family who believes this is important to us. I dread the day they feel they want to move to their own space but know it will come.

I have not seen much information on buying in an all age community? Are there any topics on this or am I in the wrong place? Btw I’m interested in Florida only