THE LAST OF THE BABY BOOMER GENERATION turned 50 this year. As this generation nears retirement, everyone in the housing business want to know how boomers will affect housing. Will they be a drag on the market by selling off properties in droves? Will they leave California in a mass exodus to live in cheaper regions? Will the boomers who were forced out of homeownership in the Great Recession ever buy another home? These questions were recently addressed in a California Association of Realtors survey, and the results paint a nice future for California housing.

More than half of boomers surveyed (59 percent) said they do not plan to sell their home when they retire; only 10 percent said they definitely planned to sell. Just 44 percent of boomers who plan to sell upon retirement plan to relocate to another state. Most (47 percent) are planning to downsize when they retire.

Fifty-four percent of boomers said they do not feel they have saved enough to retire comfortably, so it is not a surprise that 21 percent indicated they would consider a reverse mortgage to assist with living expenses in retirement. This is good news for the reverse mortgage industry, as currently less than 5 percent of eligible homeowners have a reverse mortgage.

Nearly half (45 percent) of boomers who are currently renting owned homes previously. sixty-three percent of those who currently rent said they would buy a home if they saw an improvement in their finances, affordable home prices or other reasons. More importantly, 22 percent said they plan to purchase a home in the next five years.

In an interesting statistic, three in 10 boomers surveyed live with adult children; 21 percent said their children never left home. Respondents pointed to financial issues as the overwhelming reason for living with children: 17 percent indicated their children were not able to obtain a job after college, and another 8 percent said their children were living with them because of job loss. Ten percent of boomers are living with their children to assist in the care of their grandchildren. Children living with parents contributed a median of just $325 toward household expenses.

Looking toward retirement, 25 percent of boomers said financial issues have forced them to delay retirement; loss of employment (9 percent) was cited as the top reason for postponing retirement. Another 8 percent of respondents indicated that financial losses from the 2008 recession will cause them to delay retirement.

The Baby Boomer generation has long been a driver of the housing market, so there is understandably an interest in how boomers will impact housing as they enter retirement. These survey results seem to indicate that boomers will continue their significant role in the health of the California housing market.

Guy Benjamin (CAL BRE License #01014834, NMLS 887909) writes a weekly column for The Herald, offering general information on real estate matters. As it is impossible to address all possibilities and variations, he will try to answer individual questions by readers who contact him at 707-246-0949 or guyb@fairwaymc.com.height=”150″ />

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