Baby Boomers Still Play Active Role in Housing Market, C.A.R. Survey Finds
December 22 2014 - 10:49AM
Business Wire
Previous homeowners twice as likely to buy
again as non-owners
As the wealthiest generation and the first to drive the housing
market, baby boomers will continue to be a pillar of the housing
market, according to a 2014 CALIFORNIA ASSOCIATION OF REALTORS®
(C.A.R.) survey of California baby boomers* (born between 1946 and
1964).
While nearly half (46 percent) of baby boomer renters who
previously owned a home sold it primarily due to financial reasons,
the vast majority still have a strong desire to purchase a
home.
The survey found that 63 percent of boomer renters would be
motivated to buy a home if they saw an improvement in their
finances, affordable home prices, or other reasons. Moreover, 22
percent said they expect to buy a home in the next five years.
“Baby boomers are in their peak earning years and will continue
to wield great influence on the housing market,” said C.A.R.
President Chris Kutzkey. “Even those who went through financial
difficulties during the economic crisis recognize the benefits of
homeownership and would rather buy another home than rent.”
Baby boomer renters who previously owned a home are also in a
better financial position to purchase a home, having a higher
average annual household income ($78,570) than those boomers who
have never owned a home ($39,825).
Nearly half (45 percent) of boomer renters have previously owned
a home and are more likely to buy again than those who have not
owned before by about a two-to-one margin (31 percent vs. 17
percent).
Additional findings from C.A.R.’s “2014 Baby Boomer Survey”
include:
- Nearly all homeowners (92 percent) have
equity in their home, but 77 percent said they don’t plan to use
the home equity for income during retirement.
- More than half of homeowner boomers (59
percent) don’t plan to sell their home when they retire, with 78
percent of them indicating they won’t sell because they like their
current home.
- Out of the 10 percent of current
homeowners who plan on selling their home when they retire, nearly
half (47 percent) plan to downsize to a smaller home, and 44
percent plan to move out of California.
- Despite the recent economic recession,
only one in four baby boomers had to postpone retirement. On
average, they plan to retire in nine years, with 67 percent saying
they plan to retire within 10 years.
- Three in 10 baby boomers live with
their children, with 2 percent saying they moved in with their
children; 8 percent of them saying their children moved back in
with them; and 21 percent saying their children never moved out.
The majority of those living with their children live with adult
children mainly due to their children’s financial troubles. Baby
boomers pay for a majority of living expenses, with their children
only contributing a median of $325 monthly for living
expenses.
- Improved affordability would motivate
boomer renters to buy a home, but 37 percent said they don’t want
to buy.
- Less than half of boomer renters (47
percent) have debt that would prevent them from buying a home.
California Baby Boomer Survey Slides (click links to open):
- Majority of boomer renters want to buy
a home
- Boomer renters expect to buy within 5
years
- Boomers living with their children
*Approximately 8.6 million baby boomers currently reside in
California. (U.S. Census Bureau)
C.A.R.’s “2014 California Baby Boomer Survey” was conducted in
September 2014 in an effort to learn more about baby boomers’
attitudes toward home buying and homeownership. The online survey
polled 623 California residents age 50-68. For complete survey
results, visit www.car.org/marketdata.
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Leading the way...® in California real estate for more than 100
years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one
of the largest state trade organizations in the United States with
165,000 members dedicated to the advancement of professionalism in
real estate. C.A.R. is headquartered in Los Angeles.
CALIFORNIA ASSOCIATION OF REALTORS®Lotus Lou,
213-739-8304lotusl@car.org