There Are Four Demographics That Will Affect Future Housing Markets... Keep Your Eye on them!

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A new report from the Urban Land Institute entitled "Housing in America: The Next Decade" by John K. McIlwain, points out four groups to watch for their impact on the housing market in the next decade: older baby boomers (55-64), younger baby boomers (46-54 years old), Generation Y (late teens to early 30s), and immigrants.

The older boomers will reach retirement age this decade, though many will continue to work, both because they are healthier than their parents and because they need to rebuild their retirement savings. They prefer to move to urban, mixed-use, mixed-age centers closer to their children and grandchildren. This will transform suburban town centers.

"The younger boomers are facing flat incomes, lost equity in their homes and a smaller group of move-up buyers. The market for large suburban homes will be weak over the coming decade," the report said.

Generation Y, people currently in their late teens to early thirties, are 83 million strong, surpassing the boomers in population. These "credit card kids" will likely rent for longer periods than their parents by choice or necessity as their incomes fail to rise, jobs become hard to come by, and they have large student loans to pay off. When jobs do pick up, that will create new demand for large numbers of starter homes at low prices on small lots. This may boost housing in the outer-edge suburbs that are affordable, compact and walkable, the report said.

Immigrants, legal and illegal, will also greatly impact the housing market. At an estimated 40 million, they make up about 13 percent of the population. Between 2005-50, immigration will have added 117 million people to the population: 67 million immigrants and 50 million U.S.-born children and grandchildren of immigrants, according to the report. The Latino population, in particular, will triple in size by 2050 to make up 29 percent of the total population, from 14 percent in 2005. Immigrants are 50 percent more likely than the native-born population to live in poverty. Their education levels are also lower and their populations are younger, slowing rates of homeownership.

Comments (3)

Li Read
Sea to Sky Premier Properties (Salt Spring) - Salt Spring Island, BC
Caring expertise...knowledge for you!

Thanks for sharing this...I do think that immigration will be a large sector.

Feb 02, 2010 06:11 AM
Don Eichler
Eichler Properties - Granbury, TX

Thanks this is good information to bring to our office meetings. 

Feb 02, 2010 10:17 AM
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

It has been said that Boomers might be the last generation to enjoy a better economic future than their parents !!!!!!!!

Mar 29, 2010 11:59 AM