By: The Staff Reporters of Georgia Weekly Post
Georgia, Population is 10,000,000. 1.5 millions are over the age of 65. Almost half of them - born between 1946 and 1964 - are baby-boomers.
Most of them are living in single family homes and not ready to retire yet.
Baby-Boomer Downsizing? Perhaps Not So Fast.
More "for sale or lease" signs are seen around DeKalb and Fulton counties.
In Sandy Springs, Dunwoody, Buckhead and Johns Creek, a busy real estate development season. Sandy Springs still tops the list. Johns Creek comes second.
Some conversions to residential units, from old vacant office buildings, have been recently proposed by "Minerva", a canadian developer to officials of the city of Dunwoody. Such conversion is extending beyond the new cities, as far as Duluth. Baby boomers are considered a wild card in the game of real estate development.
Several of the new proposed developments are under construction in Johns Creek, Brookhaven, Buckhead and Dunwoody reflect the current trend of choice of downsizing by Baby-Boomers.
Younger baby boomers, with more years toward retirement are still undecided, retaining their properties by choice or forced by lower market value is becoming an issue.
While the share of 50-to-69 years-olds living in multi-unit buildings rose slightly in 2012 and 2013, the long-term trend among older households shows downsizing getting rarer and happening later in life.
▲Georgia's population is 10,000,000. 1.5 are over 65. Almost half are baby boomers. The near future of the real estate market in Georgia depends on their choices.
Throughout the recession and recovery, Millennials have hogged the attention: they suffered a particularly devastating recession, which delayed their launch into the housing market, slowed overall household formation, and lowered first-time homeownership. But they’re hardly the only demographic that matters for housing. Baby boomers will help determine the demand for different types of housing and the supply of "Homes for Sale" when – and if – they downsize.
Fannie Mae released a report addressing data and conditions of "Baby-Boomer Downsizing", showing that the share of baby boomers in single-family detached homes has been roughly stable from 2006-2012 (rising slightly on a per-capita basis and falling slightly in the most recent years on a per-household basis).
The big question is what happens longer term: are we about to hit a wave of baby boomers selling their single-family homes and moving into apartments and condos? It’s unlikely, for two reasons: baby boomers are still years away from the age of downsizing, and the long-term trend shows that older households today are less likely to downsize than older adults in the past.
Let’s start by looking at the age when older households move from single-family homes to multi-unit buildings.
Based on the 2013 Current Population Survey’s Annual Social and Economic Supplement, the most recent detailed demographic data available – baby boomers (born between 1946 and 1964, which means 50-68 years old in 2014) are less likely than almost any other age group to live in multi-unit buildings as opposed to single-family homes. The only age group less likely to live in multi-unit buildings is 70-74 year-olds, which is the age group that baby boomers will start to enter in the coming years.
In later years, the share of households in multi-unit buildings rises, but by less than you might guess. Just 25% of households headed by 80-84 year-olds live in multi-unit buildings – which is a lower share than 40-44 year-olds. Even among households headed by adults aged 85 and older, only one-third live in multi-unit buildings – and that’s only counting those who head their own household are not living with adult children or in institutions.
Therefore, as today’s baby boomers age, they’ll grow into age groups first with a lower likelihood of living in multi-unit buildings (70-74 year-olds). Multi-unit living starts rising slightly at age 75-79, and rises more notably only when heads of household reach their 80s.
But will baby boomers, who are in their 50s and 60s today, look like today’s 60- and 70-somethings ten years from now – or will they make different housing decisions as they age? One clue is to look at the longer-term trend in multi-unit living among older age groups using available data going back to 1979. The share of households headed by 50-69 year-olds – roughly the age of baby boomers today – living in multi-unit buildings rose to 21.3% in 2012 and 21.6% in 2013, after holding steady in the 19-21% range for decades. Therefore, baby boomers today are a bit more likely than their parents to live in multi-unit buildings instead of single-family homes.
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