A current trend with housing and economic forecasters is the prediction that the Baby Boom Generation (generally recognized as those born between 1946 and 1964) have started and are about to leave their suburban single family homes en masse.
- In-town condominium living near the arts, shopping, and top notch medical facilities.
- Active adult (age restricted) master planned communities with high levels of amenities and activities.
- Traditional second home destinations in the mountains or coastal areas.
While Baby Boomers are making these choices and many others -- what the forecasters are missing is what so many pundits have missed repeatedly in the past about the Baby Boomers since reporting on their lives became a national past time.
Baby boomers are a diverse and widespread group, not one homogeneous statistical demographic.
Not all baby boomers were out in the mud at Woodstock listening to the warnings of "Don't eat the brown acid!". At the time of Woodstock, many leading edge baby boomers were already establishing families, others were beginning careers, serving in Vietnam, or still in elementary to high school. By the same respect not all baby boomers will follow the path to downsizing or changes in their housing lifestyle.
I don't think it is appropriate to say that a tidal wave of baby boomers are about to sell their single family homes for an alternative living style. However when dealing with a group as large as this one, any shift by a niche or sub group can cause statistical data to move and be taken as a trend. What these statistical trends miss is human nature.
A 2010 survey by AARP found that 84 percent of Baby Boomers prefer to remain in their current residences for as long as possible. For those that like a label to this sort of thing, it is called "aging in place".
No doubt many of these people will change their minds over time for personal, health, family, and economic reasons but the natural inclination of most baby boomers at this time appears to be "I'm staying where I am at".
When presented with this evidence, some forecasters will most likely argue that this is because of home value and wealth loss caused by the real estate bust and ensuing economic crisis. This may be true of some but based on my observations on a personal level and during a career of almost 30 years in the real estate and new home industries, it is my opinion that it can best be described as human nature.
In general, when people are young, and no one exemplified this better than baby boomers, people crave change. They want bigger, better, more, and want it sooner rather than later. As we age there is a craving or need for stability, we are slower to recognize and accept change, and often seek to surround ourselves with the things that remind us of what we view as a better and simpler time.
In my real estate career, including when I was selling newly built homes specifically designed for the empty nest buyer, the biggest roadblock to selling an empty nest buyer a home wasn't if they liked the home, the neighborhood, and felt it was a good value (the items that your average buyer had to accept). The biggest roadblock was waiting on them to psychologically and emotionally get to the place where they could bring themselves to leave their current home.
The two primary reasons for not wanting to leave their current home usually boiled down to emotional ties and/or fear of change at this point in their lives.
For comparison, when selling a home to a younger family type buyer, the challenge to getting them to sell their current home is to show them that they can afford something that fits their needs, wants, and income. If you do that, they will usually put their home on the market quickly (often in a matter of days) and be living in their new home within a few months. By contrast, the empty nest buyer stews over every detail and worries if it is the right thing to do, often for years before making a decision. They may even tell you they have come to a decision to purchase and then stop cold shortly before signing the contract to buy. Not because they had decided to buy a different home but because they had decided to stay in their current home.
Another way of putting this is that many empty nest buyers have a dream of making a change. The question is are they really motivated to make the change?
While these suburban homes in which so many baby boomers live may be nothing more than sticks and bricks assembled on a subdivided lot in a former cow pasture, to them it is their home. For a generation raised on once a year event viewings of The Wizard of Oz it may truly be that there is truly "No place like home"
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