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Baby Boomers Take it on the Chin for High Home Prices

baby_boomers____howstuffworksBaby Boomers are not downsizing fast enough, and by not putting their homes on the market, they are creating the inventory shortage that is driving up prices, making it tougher on would-be first-time homebuyers. This is clogging up the “whole chain of homes sales,” according to Sean Becketti, a chief economist at Freddie Mac speaking to realtytoday. Hey, blame it on the Bossa Nova.

They appear to be staying in the family home longer than previous generations,” he wrote in a new outlook report, “and the imbalance between housing demand and supply continues to boost prices.

A Federal Reserve survey of consumer finances from 2013 reveals 55 and older households control two-thirds of all home equity with a value of $8 trillion.

Patrick Simmons of Fannie Mae says there is scant evidence Boomers are leaving their “empty of nesters” homes, noting between 2010 and 2013 the number of Boomer apartment rentals remained static.

While Lawrence Yun, Chief Economist for the National Association of Realtors (NAR) points to the effects of the housing bust and recession, David Crowe, of the National Association of Home Builders (NAHB) says there’s a loopback effect of Boomers discouraged by the high prices so they sit tight.

But Simmons notes it is only temporary, as MHProNews understands. The 32 million homes now in Boomer hands will begin changing hands as they age and move on. Says Simmons, “Their actions will reverberate through the housing market.##

(Photo credit: howstuffworks–Baby Boomer couple)

matthew-silver-daily-business-news-mhpronews-comArticle submitted by Matthew J. Silver to Daily Business News-MHProNews.

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