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Why Baby Boomers May Bust the Housing Market
The Wall Street Journal ^ | January 16, 2008 | Lauren Baier Kim

Posted on 01/18/2008 5:08:33 PM PST by Lorianne

Think the current housing downturn and the subprime mortgage mess is the worst of the housing market’s problems? Not so, according to a report published this month in the Journal of the American Planning Association.

About to wreak havoc on the housing market are the 78 million American baby boomers who will “retire, relocate, and eventually withdraw from the housing market,” according to report authors Dowell Myers, a professor of urban planning and demography in the School of Policy, Planning and Development at the University of Southern California, and SungHo Ryu, an associate planner with the Southern California Association of Governments.

Using demographic data to show that individuals in their mid-60s tend to sell more often than buy, the authors contend that when boomers — a “dominant force in the housing market” — start reaching the age of 65 in the year 2011, a market shift will occur. Some retirees will be looking to downsize, others will relocate to warmer climes, while others will move to nursing homes, says Mr. Myers. As they transition out of the housing market or look to sell their homes, in some states there will be “more homes available for sale than there are buyers for them.” Home prices will soften.

The “sell-off” will create a sizeable hurdle for the housing market, because as Mr. Myers puts it, “It isn’t money that buys property, it’s warm bodies. If you don’t have enough warm bodies to fill up the space, the space stays empty.”

(Excerpt) Read more at blogs.wsj.com ...


TOPICS: Business/Economy
KEYWORDS: babyboomers; housing; realestate
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To: Lorianne

OMG, it’s our fault for getting older!!!!!


61 posted on 01/18/2008 8:36:55 PM PST by gracesdad
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To: Lorianne
while others will move to nursing homes

At 65? Only the long-time stoners will be that decrepit at 65.

62 posted on 01/18/2008 8:39:01 PM PST by giotto
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To: sphinx

that’s exactly why wall street and washington don’t want restrictions on immigration.

if you think people are angry now, wait until immigrants stop coming. the economy will be broke.


63 posted on 01/18/2008 8:44:23 PM PST by ken21 ( people die + you never hear from them again.)
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To: Lorianne
Oh no! Better import some dirt-poor Mexicans to take up the slack.

If boomers hadn't dropped their fertility rates so much, this would not be a problem. They are the Me-generation, and the generations that follow them will pay for it. The nation will recover from the boomers in about 50 years, if it last that long.

64 posted on 01/18/2008 8:59:53 PM PST by Defiant (Don't be a hostage to Hope.....Arkansas. Vote Fred.)
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To: Graybeard58

Dad was home on leave, eh?


65 posted on 01/18/2008 9:04:29 PM PST by Defiant (Don't be a hostage to Hope.....Arkansas. Vote Fred.)
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To: dr_lew

“And you yourself are ... what?
The first and only free thinking individual in the history of earth?”

Duh. I think my point was obvious but I’ll explain it again.

It’s not the Boomers that are the real problem. The real problem started with their socialist parents. Many people seem to think of Brokaw’s “Greatest Generation” as somehow wonderful and virtuous but they were the original American socialists.


66 posted on 01/18/2008 9:18:21 PM PST by webstersII
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To: elkfersupper

Great post. :-)


67 posted on 01/18/2008 9:31:45 PM PST by lmr (The answers to life don't involve complex solutions.)
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To: HangThemHigh
Especially east Tennessee. Don't go there. Just a bunch of hillbillies & hicks down here anyway;).

I have a dear niece and family who live in eastern TN. She's definitely not a hick. So you couldn't scare me off from moving there, if I really wanted to move there. Now, WV would give me pause.

We found a beautiful piece of property in a semi-rural area near but not on top of lots of great amentities and I'm not telling anyone where it is.

68 posted on 01/19/2008 6:31:00 AM PST by randita (Do not trust any polls!)
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To: Lorianne

We own rentals in a college town and a duplex (both sides) in a town which is the youngest and fastest growing town in our state so I’m not worried about those properties. I do get a bit depressed though when I look around our neighborhood and see only two families with children at home. sigh.


69 posted on 01/19/2008 6:31:01 AM PST by Mercat (Kennedys: Can't drive, can't swim, can't fly, can't ski, but they know what's best for us.)
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To: E. Pluribus Unum

megadittos


70 posted on 01/19/2008 8:12:28 AM PST by omega4179 (Hillary lost the civil war ll)
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To: ken21

By that logic, mexico would have a stronger economy than us with all those street sweepers and maids.


71 posted on 01/19/2008 8:13:22 AM PST by omega4179 (Hillary lost the civil war ll)
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To: omega4179

nada.

the u.s. aborted 30,000,000+ children, necessitating replacement labor.

a booming economy requires an expanding labor force.

conversely, a contracting labor supply causes severe economic problems.


72 posted on 01/19/2008 4:41:50 PM PST by ken21 ( people die + you never hear from them again.)
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To: dr_lew
... and I still say the young peoples is gonna be huntin' us down in the streets before it's over.

You are correct. Fortunately (or unfortunately as the case may be), the vast majority do not understand the sweetness of the M1911-A1.

73 posted on 01/19/2008 6:00:03 PM PST by elkfersupper
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To: fso301
The already caused the bust by aborting 50 million babies who will never have a chance to buy their homes.

Not that it changes the moral problems that exist as a result, but considering the socioeconomic status of most women who've had those abortions, I don't know that too many of those would have grown up to be homeowner material.

74 posted on 01/19/2008 6:04:11 PM PST by RockinRight ("Mike Huckabee appeals to the type of person who thinks pro-wrestling is real." - TQC)
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To: randita

Well for you OK


75 posted on 01/19/2008 8:23:48 PM PST by HangThemHigh (Entropy's not what it used to be.)
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To: RockinRight
Not that it changes the moral problems that exist as a result, but considering the socioeconomic status of most women who've had those abortions, I don't know that too many of those would have grown up to be homeowner material.

They never-the-less would need some place to live. From what I've seen of abortion statistics, I suspect millions of the 50 million cumulative abortions would have been born to middle and upper middle class women.

An indirect observation is that when you take a drive through certain ethnic communities, you see lot's and lot's of children running about. Whereas in other communities, there is a noticeable lack of children seen running about.

76 posted on 01/20/2008 9:51:19 AM PST by fso301
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To: Lorianne
On the other hand, the decline in prices will be a boon for young, first-time buyers with good credit.

Around here, I see a lot of "aging in place" - people paying contractors to "ageify" their homes (adding safety rails, ramps, putting laundry facilities on the first floor, etc.) Ranch houses are even coming back into style because they are one-story.

Also, 65 is pretty young for a lot of people to go into nursing homes. I think you're looking more at 80 and 85. With more people getting serious about their weight, health, lifestyle, etc., IMO the boomers are going to probably suffer less from aging than previous generations.

77 posted on 01/21/2008 8:07:58 AM PST by valkyrieanne
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To: Lorianne

I can see a lot of ‘boomer’s taking the reverse mortgage road and leaving the house to Sally or Fanny May instead of junior.


78 posted on 01/21/2008 8:15:32 AM PST by AU72
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To: ken21

“if you think people are angry now, wait until immigrants stop coming. the economy will be broke.”

I’ll be keeping a close eye on Arizona and their death penalty for businesses hiring illegals.


79 posted on 01/21/2008 8:22:22 AM PST by listenhillary (A government big enough to give you everything you want is big enough to take everything you have.)
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To: HangThemHigh
Especially east Tennessee. Don't go there. Just a bunch of hillbillies & hicks down here anyway;).

Too late! My mom and dad leave Maryland next week (God willing) and they're headed your way.

80 posted on 01/21/2008 8:36:58 AM PST by Dianna
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