Some want to age in place, keeping close to family and community. There are also concerns about being able to find and afford another place once they sell.
Not All Baby Boomers Are Downsizing
FORT LAUDERDALE, Fla. – Despite conventional wisdom saying that downsizing should happen later in life after the kids have left the house, some South Florida baby boomers are deciding to stay put in their homes.
Data from Zillow that profiled baby boomers and their selling habits found that of the 2% of baby boomers who moved in 2021, 46% reported downsizing to a smaller home.
But that’s not necessarily the case with all baby boomers, experts said. Some of them are planning to stay in the homes where they raised their children, and areas where they put down roots.
“With older Americans, we have seen that people just want to age in place. They have the doctors they like, their social circles.” Karan Kaul, principal research associate in the Housing Finance Policy Center at the Urban Institute in Washington, D.C.
Dennis Berger, a 74-year-old resident of Coral Springs, has been living in the same three-bedroom, two-bathroom house since he and his family moved down to South Florida from New York in 1988.
He and his wife paid about $125,000 for the 1,800-square-foot home and raised two kids there, who now live nearby. Today, the house is paid off, and he believes he could get between $450,000-$500,000 for it, based on recent estimates he’s received from Zillow.
Despite the handsome profit, and their ability to downsize now that the kids are gone, he and his wife don’t plan on leaving. They’ve talked about it, but the math – and quality of life issues – just don’t add up. They live 20 minutes away from their son and daughter, and their grandchildren live in Fort Myers. The proximity to family is something that can’t be replaced, they say.
Yes, they could move to a condo in the area, but many are priced too high in this hot market, and a retirement community would also be too expensive.
“We have a private swimming pool here, which my wife has been using for her physical therapy. And at our age, when you are packing up a house that you have been in for 34 years, what do you keep and what do you let go of?” he said.
A seller’s market but nowhere to go
There’s no question that this is a seller’s market, with homeowners like the Bergers able to get the maximum amount of money from buyers. The latest data from the Broward, Palm Beaches and St. Lucie Realtors shows that sellers got 100% of their asking price, up about 3% from the year before. And with many buyers willing to waive appraisal and inspections, it’s a good time for sellers take advantage of the market.
“Especially for sellers who are a little bit older, particularly baby boomers, they often have little to no mortgage if they spent 20-30 years in their homes,” Patty Da Silva, broker with Green Realty Properties in Cooper City said. “They are sitting on a pile of cash, but where do you go, and do they even want to do it to begin with? It can all feel a bit overwhelming.”
Many sellers in general are wary of selling because not only do they feel that they have nowhere else to move, since inventory is so low in South Florida, they are also concerned about spending more money to get a home, according to Dee Emmanuel from The Keyes Company’s Hollywood office.
“Some sellers want to sell at the top and buy at a better price, but the truth is that we don’t see values going down anytime soon because there is low inventory,” he said.
Some empty nesters are even upsizing. Sam Gray, 58, and her husband purchased their home in the Cypress Run neighborhood in 2016 (he passed away in 2020). Their previous home in Davie was a three-bedroom, two-bathroom around 1,800 square feet and the current home is around 2,500 square feet, with an outdoor patio, four bedrooms and two bathrooms. It also has a pool, which she always wanted. She says she’s not going anywhere.
“I want this house,” Gray said. “I don’t have a reason to move, and frankly, I hate living in apartments and condos.”
She lived in a condo when she and her husband first married, but didn’t like the close proximity to other people, the noise and feeling that everyone was on top of each other.
She’s redone her kitchen to her liking, and the amount of space she has is perfect for her two large dogs. Most importantly, she’s centrally located to her sister, father and nephew, who live close by.
“I don’t have a reason to sell and I don’t anticipate having a reason to,” she said.
If baby boomers downsize, will it free up inventory?
Baby boomer own the largest share of real estate wealth in the U.S since 2001, according to a data analysis from the New York Times.
“Baby boomers are living longer and are healthier than previous generations and it’s enabling them to stay longer in their homes, which is a good thing,” said Danielle Hale, economist with realtor.com.
Even if baby boomers downsized, it wouldn’t have much of an effect in helping cool down soaring prices in the real estate market, experts said.
“The issue is that we haven’t kept pace with population growth,” Kaul added. “At the end of the day, everyone needs a place to live. You don’t solve the problem unless you make more additional housing units, which is the core of the problem.”
Inventory levels in South Florida have plummeted, with about only a month’s worth of supply of homes in the tri-county area. A healthy market normally has about six months of supply, according to experts. And a Zillow report found that after decades of underbuilding, South Florida has a shortage of 142,650 homes if builders had kept up with the rate of population growth between 1985 and 2000.
Those factors play a part in both non-boomers scrambling to find homes, and baby boomers staying in the homes they currently own.
Copyright © 2022 South Florida Sun-Sentinel. Distributed by Tribune Content Agency, LLC
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