HousingWireHousingWire
In a traditional sense, the term “silver tsunami” refers to pent-up housing stock that older homeowners will eventually choose to sell, which would have the effect of flooding the market with new inventory. But if prior suppositions about this trend being overblown failed to convince people, new data might make things clearer.
More than half (54%) of baby boomers have no intention of ever selling their homes, according to new survey data from Clever Real Estate. This cohort expects to remain in their homes for the rest of their lives, based on responses from 1,100 people born between 1946 and 1964.
“There’s a wide variety of reasons homeowners made this decision,” the survey results explained. “About half say their current home fits their lifestyle needs (52%) or they prefer to age in place (47%).
“The low housing expenses that come with a fully paid-off mortgage are also keeping 40% of boomer homeowners in place. Owning their house outright may also be a factor for 37% of boomer homeowners who have considered leaving their homes as an inheritance.”
This also suggests that nearly 40% of baby boomers not only never plan to sell, but they also intend to pass their current home to family, barring heirs who elect to sell a property.
Money does not appear to be an overwhelming driver in this decision, the results suggest. Nearly one-quarter of respondents (22%) said their emotional attachment to the home is the key reason they wish to stay put, while roughly one in five (19%) said they don’t want to give up ties to their community or the friendships they’ve built.
But affordability plays a role too, with 25% of respondents saying they simply cannot afford to move to a new home. Another 16% said that staying put is the easiest option considering the cost of an assisted-living facility.
“Still, almost all boomer homeowners (90%) have concerns about homeownership as they age, primarily based on growing expenses,” the results stated. “The cost of maintenance and upkeep tops the list (59%), while being able to physically take care of these tasks isn’t far behind (55%). About half (49%) worry about property tax increases, while 42% are concerned about rising utility costs.”
As evidenced in a state like Louisiana, property tax hikes also appear to be pushing more older homeowners to consider a product like a reverse mortgage. About 30% of the group surveyed by Clever plans to sell their home in the next five to 10 years, which means that some of this inventory may not hit the market until the mid-2030s.
