Senior Spotlight: Is The Silver Tsunami Finally On It’s Way?
Sources state that 51% of those over age 50 are set to downsize starting in late 2024.
Silver tsunami. You’ve heard the term, and probably know that that it refers to a surge of Baby Boomers entering retirement and serves as a metaphor for the wave of changes that is bound to erupt with it. An explosion is expected in terms of employees exiting the workforce, healthcare needs rising… and more homes entering the market?
A recent article from Yahoo! News shares predictions from some analysts that tens of millions of homes could hit the market in the years to come. Meredith Whitney, CEO of the Whitney Advisory Group, shares data from AARP that 51% of those over age 50 plan to downsize – some to smaller homes and some to retirement communities. (Note that Whitney is also known as the “Oracle of Wall Street’ after predicting the 2008 financial crisis.) Homeowners over age 50 currently hold 70% of US homes. Whitney forecasts that this shift will start to occur in late 2024 and into 2025 - lasting for a decade or more. The result could be 30 million housing units back on the market.
While the news sounds good on the surface, Whitney lists some potential pitfalls of such a tsunami. Undesirable outcomes could be:
- Not enough younger buyers to ‘absorb’ the homes freed up by sellers
- Milennials missing out on the benefits of the inventory increase because it could take a decade to play out
- Baby Boomers selling but not actually freeing up inventory IF they buy smaller homes and now are competing with entry level buyers (and then starter home prices would surge!)
While there is no crystal ball, there are likely to be some expected and unexpected shifts in the housing market as we experience the impact of Boomers aging. What they will decide to do depends on countless factors – which includes their own health and lifestyle factors, their financial needs and wants as well as rates and senior housing options available.
The only thing we truly know is that anything is possible; that knowledge can be both frustrating and freeing at the same time. Making the best decisions for you with the information you have and the market you are in is usually the best plan possible. Think about it! 😉
Resources Used:
‘Silver tsunami’ from downsizing baby boomers is headed for housing market, analyst says ; A 'Silver Tsunami' Is About to Upend the Housing Market, Says Analyst Who Accurately Predicted the 2008 Financial Crisis ; What is the Silver Tsunami?
Have a great rest of the week,
Bobbi
Bobbi Decker
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Broker Associate
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www.bobbidecker.com
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