In the post-war era, birthrates spiked as millions of soldiers came home from war eager to start families. This “baby boom” led to the creation of the largest demographic in the U.S. As Baby Boomers aged, they made a significant impact on the world around them. In the 80’s they became the largest voting demographic in the U.S. and they currently hold roughly 70% of the disposable income in the U.S. As boomers are now reaching retirement age, they are a large enough demographic to change the entire face of real estate. Here are three ways retiring baby boomers are changing real estate.
Massive shift from buying to renting
Baby boomers are not the first generation to offload the large family homes they raised children in as soon as they reach retirement age but they are the largest. Unlike their predecessors, however, they may not be as inclined to purchase a smaller home or condominium as they are simply renting new digs. Boomers have grown up in a world that is more mobile than ever and that may be how they want to live out their last days.
Movement into urban centers
Previous generations of retirees have shown a strong propensity for heading south as soon as they no longer have a job holding them in the colder northern climes. Some have opted to keep family homes and purchase smaller homes in the south or simply live in an RV to follow the moderate weather. Baby boomers, however, are more likely to want to age-in-place. That doesn’t mean they necessarily want to keep their family home, however. Boomers are more likely to move out of the suburbs and back into urban areas. The premier retirement communities of tomorrow may not be on golf courses or the beach but right in the heart of medium to large cities.
Transportation and retail are key
Baby boomers were a hardworking but affluent generation. In the post-war era, they grew up enjoying a number of government subsidies geared towards boosting the post-war economy. They enjoyed cheap housing and even cheaper educational opportunities making them the first highly educated generation but without the subsequent debt load of the generations that followed them. In retirement, they will turn shopping into a leisure activity but prefer brick-and-mortar stores to online shopping. Boomers, like Millennials, are likely to pay attention to walkability scores and to move into areas where they have everything they need within walking distance or quick transportation readily available.