Boom, bust and the new 'boomers'
Letter to the Editor
By Inman News, Monday, June 7, 2010.Re: 'A real estate recovery in 2013' (June 7)
Dear Editor:
The industry continues to suffer from an imbalance of supply and demand, and the experts are disproportionately focused on foreclosure inventory and dangerously underestimating the inventory to be realized by downsizing or retiring baby boomers.
Almost every single baby boomer in this country falls into an age group categorized as "seller" first. While it's true that many will buy again, what needs to be calculated is how many will not. How many of them will "exit only" because they pre-purchased their retirement home must be balanced against the number of entry-level first-time buyers. The trade-up segment in the middle is severely depleted due to very low birth rate in the 1970s, which is delivering an insufficient number of 30-something buyers in today's market, which contributed to the shortage of first-time buyers we just experienced.
After all of that is calculated, we need to remove the chunk of homeowners who lost their homes over the past five years but who would otherwise have been trade-up buyers in today's market and in the coming few years. We cannot continue to ignore the looming retirement and liquidation of the Baby Boom, and yet it has never even been addressed. However, the good news is there is an enormous generation (under age 30) which is actually larger than the Baby Boom and is just beginning to mature financially and enter the market.
The trick will be to get these "kids" into owner-occupied properties to create trade-up and absorption at a rate faster than the boomers enter retirement.
Susan Rossi
RE/MAX 2000
Crete, Ill.
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Submitted by Ted Jernigan on June 7, 2010 - 2:09pm.
This year empirical data I am seeing supports your contention that Boomers are downsizing, and I see them moving to be near their grandchildren. Our business has involved many of these moves this years. Our son, who works with my wife and me, is providing us access to the "kids" who are buying their second house. These are not first time buyers. They are upsizing slightly. Our son went to high school in the community where we live and work. And lived here during his college years. His friends and classmates are in the market for homes. As I say constantly in postings, we did not have the bubble seen other places, and we continue to have an influx of people from other parts of the country. These circumstances uniquely position McKinney and Collin County for continued success.
Ted Jernigan
Ebby Halliday REALTORS
McKinney, Texas 75071
www.TeamJernigan.com
972-489-6173