Housing recovery suffers, but don’t blame the millennials
Competition for housing is soaring, affordability is weakening and the U.S. housing recovery is grinding to a crawl — and, in large part, the baby boom generation is to blame.
No, they’re not doing anything immoral or illegal; in fact, they’re not doing anything at all, and that is precisely the problem. They’re not moving.
Baby boomers, the enormous group born between 1946 and 1964, are staying in their big suburban homes far longer than previous generations did at this age, and that is having repercussions down the housing supply line. If baby boomers don’t downsize out of big suburban homes, younger buyers eager to upsize, especially in this improving economy, can’t find a home to buy.
As the competition from young millennials heats up at the entry level, the logjam at the top of the market only heats that competition and pushes prices ever higher and out of reach.
So, why don’t boomers move? Some if it is because their empty nests have filled back up again with children moving back home after college, but in large part it is a result of the recession and the increasingly high cost of housing. It is simply cheaper for them to stay put, and so they do.
Baby boomers currently own about 3.6 million unoccupied rooms, according to Trulia, a real estate website that looked at the 100 largest housing markets to find boomers living in homes with at least two bedrooms more than the number of occupants.
Laraine Camera Goldberg is one of them. She and her husband bought a five-bedroom house in North Potomac, Maryland, nearly 40 years ago and raised their sons there. The neighborhood was and still is perfect for raising a family, with quiet streets and good schools. Now Goldberg’s sons are grown and gone, and she and her husband are divorced. She lives alone in the 3,000-square-foot home that boasts a huge yard and pool. She could sell the home easily, as there is very high demand in her price range, but there is one problem.
“I don’t know where to go from here because everything is so expensive. I’m stuck,” Goldberg said. “It’s actually less expensive to stay here and metro into the city than move into the city. So I’m stuck, but I’m in a neighborhood by myself that really I don’t belong in.”