Posted on 05/03/2024 5:10:58 AM PDT by Libloather
Baby boomers are refusing to downsize in their golden years, according to a Redfin study, which found that the generation born between 1946 and 1964 owns nearly three in 10 (28.2 percent) large homes in the nation—nearly twice as many as millennial households with kids (14 percent).
This is happening despite boomers' kids having long left the nest and their households having shrunk to one or two people. Instead of selling their large properties and moving to a smaller place, boomers are turning the extra bedrooms into hobby rooms and guest rooms for visiting family members.
Read more: What Is a Home Equity Loan?
While it's understandable why boomers are holding on to their mortgage-free large homes, which are likely cheaper than what a new, smaller property might cost them now, their choice to stay put is having a profound impact on the U.S. housing market, contributing to keeping inventory tight. Some 54 percent of boomers own their homes and no longer need to pay a mortgage, according to Redfin.
The historic supply shortage in the country, which is mainly because the U.S. hasn't built enough homes since the 2007-2008 crisis, has kept prices up, even when demand dipped between late summer 2022 and spring 2023, triggering a correction at the national level.
"The number of homes for sale is near historic lows and that is in part due to baby boomers holding on to their homes and aging in place," Daryl Fairweather, Redfin's chief economist, told Newsweek.
"The larger problem is that there isn't enough new construction being built to meet demand from Gen Zers and millennials or from baby boomers who would want to downsize in retirement."
(Excerpt) Read more at newsweek.com ...
I prefer to hang on to my paid off appreciating asset.
Down the road, we may move to a smaller place and pass our big house down to our kids. They can lease it out or sell it to fund their own places.
“Isn’t that contingent on buying another home?”
I don’t see that as a requirement. Prior to this rule, the old rule was you could roll over if you traded up. But this is independent of a new purchase. See the summary here:
Consult someone who knows what they are doing, particularly if you have special circumstances (acquisition by divorce or a 1031 exchange; multiple residences; military or diplomatic service, first time home buyer credit, etc.)
Yes. And “I won’t blame 30 million illegals, so I’ll blame my parents and grandparents for being evil parasites.”
That’s too bad. My wife and I live in a 5 bedroom, 4000 square foot house. And we payed for it. It’s no one else’s business what we do.
The problem is after you sell the home and buy a new hoo ok me. The property taxes start at the new home price which could be double or triple what the previous home was. Many can’t afford that. Maybe make a deal that they pay the same property taxes? The city/county still be ahead with the new owners of the original home. This would only affect seniors.
They have to tax you, how else can they payoff those student loan debt.
two good points. another popped bubble will make everyone feel better.
I just sold my mom’s house after she died last year. The family picked what we wanted and then had an estate sale.
Emotionally it’s sad, but it wasn’t that much work.
I only wish I knew the value of her things.
She had lots of nice things.
I’m going to try to give more information to my kids so they know what’s what.
Some of the same landlords that couldn’t collect rent or evict during covid?
which is why is said “large” gains.
Yea, they tried this with the Navy Yard and the young people have had enough and are all moving out and over to VA b/c the crime is SO bad in DC overall but especially in the Navy Yard/Capitol Hill area.
In central Florida they are. And these homes are selling with barely a yard. It’s crazy. They are building with zero thought of infrastructure. It’s a traffic nightmare.
I was referring to federal capital gains on the sale.
You can read about it here
https://smartasset.com/financial-advisor/stepped-up-basis
Precisely
"I want my worthless college loans paid"
"I don't just want the basement, I want the whole house"
"I want what I want, and democrats say I can have it!"
...whether I earned it or not is irrelevant"
...whether I(or the country)can afford it or not is irrelevant"
I agree...It was absolutely wrong.
...Soylent Green
>> Are we supposed to feel guilty?
Yes!
But don’t. :-)
Gotta get those interest rates back down in the 3-4 percent range to make downsizing worthwhile.
Ditto, two of us. 2800 sq ft house on 12 acres.
House is paid off.
However, we breed dogs. So, as long as the Mrs. want to continue doing that we can not downsize into even a 2 acre property like our previous home.
The other main reason is that the smaller free standing condos in the area are just as expensive as what our current home is worth. Some are even more expensive. Especially, when you add the $600-1100/month condo/maintenance fee.
They are building a new development 1 1/2 miles south of my house. It is going to have 30 duplexes. Two and three bedroom. It is also a 55 and older community. I wonder how much they are going to be asking for those.
All of the reasons discussed on this thread are the reason my friends business is BOOMING. They install and service stair lifts. Older people do not want to move out of their homes. Therefore, they will change their existing home into something they can live in. Even if that means a remodel like adding a bedroom and bath to the first floor.
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