Finance and Legal
Millennials, Boomers and Housing
Reported by Stu Johnson
Posted: January 26, 2020
Trend could impact seniors…
In a January 20 article entitled "Millennials' share of the U.S. housing market: Small and shrinking" Christopher Ingram of the Washington Post paints a dramatic picture that could have significant impact on senior homeowners. I will provide the key bullet points here, then you can read theon the Washington Post website.
Today’s young adults are starting their lives on drastically different financial footing than their parents did decades ago. They pay more for suchas , leaving many young families to incur mountains of debt and a limited path for .
- In 1990 baby boomers, whose median age was 35, owned nearly one-third of American real estate by value.
- In 2019, the millennial generation, with a median age of 31, owned just 4%.
- While there may be some catch-up by the time they reach 35, millennials may not reach even the 20% of homeowership value achieved by the smaller Generation X cohort at the same point in their lives.
- Because home ownership is a significant wealth builder, millennials are likely to have lower lifetime wealth, which is bad news for the economy.
- Millennials face the dual challenges of housing costs with median values well beyond typical salaries and massive debt, primarily through student loans.
Seniors are not immune, as Ingram points out:
As baby boomers, a projected will come on the market in the coming years. But millennials and younger generations might not be able to afford them.
. . . On the other hand, some of those boomers will leave their estates to their children [which may mitigate the trend to some extent].
. . . One mystery remains, however: As things stand, the share of housing wealth accumulated by American millennials is falling — in 2016 it reached a high of 7.5 percent and has been declining steadily since. Conversely, boomers and members of the silent generation have seen their collective share of the American housing market rise about 5 percentage points since 2016.
This article was also published on Stu Johnson'sblog.
Stu Johnson is principal of Stuart Johnson & Associates, a communications consultancy in Wheaton, Illinois. He is publisher and editor of SeniorLifestyle, writes the InfoMatters blog on his own website and contributes articles for SeniorLifestyle.• Author bio (website*) • E-mail the author (moc.setaicossajs@uts*) • Author's website (personal or primary**)
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