Take a little break from the sport of millennial bashing for an assault on Baby Boomers.
If you can’t find a house to buy, they’re your reason, the Washington Post says.
They’re not “downsizing” fast enough.
“They appear to be staying in the family home longer than previous generations,” Sean Becketti, chief economist of Freddie Mac wrote in a new outlook report, “and the imbalance between housing demand and supply continues to boost prices.”
Two-thirds of all home equity is owned by people 55 and older, with a total value of about $8 trillion.
What’s the big deal? It’s that in past generations, once the kids were out of the house, the parents went small, freeing up more housing for the next generation.
That’s not happening, however.
People who sell, build and finance new and existing houses care — it’s their bread and butter — as well as potential buyers squeezed by rising home prices on one hand and rising rents on the other.
According to Realtor.com, median list prices as of October were up 6 percent year over year. Inventories of houses listed for sale nationwide were down by 3 percent during the same period.
Three percent doesn’t sound like much. But check out the shortages and price increases in a few major markets:
- Seattle listings as of October were down 19.1 percent, while median list prices had jumped by 10.3 percent.
- San Diego listings dropped by 16.4 percent; median prices rose by 13 percent.
- Charlotte listings declined by 9.8 percent; median prices were up by 12.8 percent.
- Salt Lake City listings were down by 23.4 percent; prices were up by 10.2 percent.
No one’s blaming this on boomers alone. Economists say boomers’ slower-than-expected rate of downsizing and selling is playing a contributing role in supply, demand and pricing imbalances in local markets — not creating those imbalances.
I can’t help you, kids. I’m staying in the house where I raised my kids, just as my parents stayed in theirs.
Why? Because that’s the place I raised my kids.
Related: Not many homes for sale in St. Paul (St. Paul Real Estate blog)