As boomers decide to stay put, so are approximately 33 million properties, blocking the path to entry for millennials and first-time home buyers
Housing inventory has hit a 20-year low as the appeal of McMansions wanes and Baby Boomers grow increasingly reluctant to trade up or down from their current homes, according to a survey by Realtor.com, an online real estate listing site operated by News Corp.
Housing Shortage Study
Realtor.com conducted the survey of 1,054 randomly selected homeowners across the U.S. According to the results, approximately 59% of respondents are not planning to sell their home in the next year, with nearly 35% planning to sell, and nearly 6% unsure. Respondents reported two primary reasons for today’s housing shortage: reluctance to sell, and homes fitting current family needs.
“The housing shortage forced many first-time homebuyers to consider smaller homes and condos as a way to literally get their foot in the door,” said Danielle Hale, chief economist for Realtor.com. “Our survey data reveals that we may see more of these homes hitting the market in the next year, but whether these owners actually list will depend on whether they can find another home.”
Many Boomers Are Content with Their Houses
One of the reasons cited for the housing shortage has to do with Baby Boomers. Simply put the vast majority of those who are at or near retirement age like where they are. Homeownership among Baby Boomers is at 78% or about 33 million properties. That’s nearly twice as high as Millennials. Older age groups have historically moved less frequently than younger home buyers and the trend continues. But the market dynamics have shifted because there are more people in the older age groups than in past years.
A key reason for homeowners staying put for a longer period is because of inadequate levels of new home construction over the past decade. Also, the gap between trade-up homes and premium homes has widened, pricing out many Boomers who would like to move up.
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