3 ms·

Baby boomers are snatching houses out of the hands of millennials

25 points by harambae 5y ago

maxerickson 5y ago
Assisted living is a much higher level of care than a retirement community, which I think is probably the sort of place the article means. (assisted living is where you go when you can't meet all of your own daily needs anymore, not where you go when you get sick of mowing the lawn)
- WalterBright 5y ago
  > when you get sick of mowing the lawn I decided to landscape with weeds. Weeds thrive with no water, no pesticides, no nothing, not even dirt. The perfect lawn! Mine is completely maintenance free.
1270018080 5y ago
If you're buying a home and living in it (which is what it sounds like the boomers are doing), I can't really find room for criticism. I think having a chance to build equity in a home you live in is a great thing. If they're snatching these houses to rent out, deny others a chance at equity, and profit off of (overcharge) the less fortunate, especially during a housing shortage with no end in sight, I have a problem. Building more housing will always be the primary solution to the housing crisis, but not letting the greedy steal homes would be a nice short-term bandaid.
- _lz4k 5y ago
  Is it really a problem if boomers are buying second, third, or even fourth homes to rent out? This has long been a common path for the elderly to afford healthcare and living expenses in their golden years rather than relying on the government. I feel large companies and financial institutions that are buying up swaths of residential properties are trying to find a scapegoat and they have found one in boomers. I imagine we will see more propaganda pieces like this one, pinning the blame on them.
  - onecommentman 5y ago
    The younger-than-Boomers (ytBs…is that an actual acronym?) have something they can do about investors buying properties. If you control the estate of Boomers who owned residential property, sell the house(s) to people who will reside there, not use it as rentals or as an “investment”. Might get less money upfront, but you will sleep better at night. Another thing ytBs (looks ugly, might not use) could do is develop aging-in-place tech to make it unnecessary to rent that second house. Aging-in-place is already much cheaper than nursing homes https://journals.healio.com/doi/10.3928/19404921-20110802-01 https://journals.healio.com/doi/10.3928/19404921-20110802-01 What new tech would allow the elderly to age-in-place more efficiently? The elderly are too old to develop it themselves…
    - _lz4k 5y ago
      I don’t agree with the premise that there is a problem with boomers buying a home and renting it out to someone who would rather rent than own. I see the problem is rather monopolies and hedge funds buying homes by the thousands and driving up the prices in select markets.
tuatoru 5y ago
Setting us up for a house price crash in ten to fifteen years, as the Boomers age into their years of disability and want to sell their houses so they can move into "assisted living" / "sheltered" housing. It's really worth having a look at the charts in [1]. People are living longer (age at death is compressing to a peak around 90 years old), but there are still about 15 years of ill health before death. Since we know the age of the baby boomers, we can predict this crash. 1.Robine, Jean-Marie, UN Department of Economic and Social Affairs, September 2021. Ageing Populations: We are living longer lives, but are we healthier? UN Ref: UN DESA/POP/2021/TP/NO.2. Downloaded from https://www.un.org/development/desa/pd/ https://www.un.org/development/desa/pd/ on 11 Oct 2021.
- rsj_hn 5y ago
  > Setting us up for a house price crash in ten to fifteen years, as the Boomers age into their years of disability and want to sell their houses so they can move into "assisted living" / "sheltered" housing. I'm really not sure where you are getting your numbers. Only 4.5% of seniors live in assisted living facilities. Most people will never set foot in one -- they will live independently up until they die, possibly spending a few weeks in hospice if things drag out. With new tech it is even easier now to live on your own -- e.g. you can order things delivered, there is telemedicine, grocery delivery, meal delivery, house cleaning services, uber, etc. Moreover you can now get little motors to take you up stairs, there are all sorts of automated appliances. The days of a large share of seniors needing to live in assisted living are long gone. https://www.ncbi.nlm.nih.gov/books/NBK51841/ https://www.ncbi.nlm.nih.gov/books/NBK51841/
  - tuatoru 5y ago
    Yes, I put that badly. But medical and living assistance costs go up steeply after 75, and many people will sell properties to pay for them.
    - rsj_hn 5y ago
      For nursing homes, it's 1% for ages 65-74, 3% for 75-84 and 9% for persons age 85 and over. Half of all those in nursing homes are older than 85. For general expenses, there are reverse mortgages for this. But again, I'm not sure what difference it makes to sell the house before rather than after you die -- especially for really old people. It will go on the market either way. Even if you give the home to a child, they will either sell it, or move into it and sell their existing home. Either way, when someone dies, the demand for housing decreases by 1. So declining populations do lead to cheaper housing (which is a good thing in places where housing is expensive).
gruez 5y ago
The article is trying really hard to push an inter-generational conflict narrative, but it's missing a very important detail: are boomers adding/subtracting from the housing supply, on net? They are "more active in the housing market" and are responsible for more of the housing purchases, but that itself isn't really an indication of anything. If they're just upsizing/downsizing, then they're not "snatching houses" from the overall housing supply. If anything, boomers selling houses in urban centers for suburban/rural houses (I suspect boomers aren't dying to get a house in SF for the nightlife) should be a good thing for millennials. The linked zillow report hints at this, because they also mention boomers using their equity for all-cash offers. If they were buying a second house, that would indeed be bad, but I doubt this is the case. I don't think banks would give a $500k mortgage to 60 year olds.
- _lz4k 5y ago
  Even if they are buying second houses, I highly doubt that boomers are having anywhere near as large an impact on housing markets in relation to large corporations and financial institutions that are buying more and more residential properties. These larger organizations are pinning the blame on boomers via PR, when there is really no comparison in who has more invested. https://www.usnews.com/news/business/articles/2021-09-09/companies-step-up-buying-houses-bet-on-hot-housing-market https://www.usnews.com/news/business/articles/2021-09-09/com...
  - fxtentacle 5y ago
    Great point. "nationally, investors bought more homes than they sold in the first half of this year"
- fxtentacle 5y ago
  In my neighborhood, old people are investing their savings into houses and then rent them out. The hope is that they'll be able to live off the rent during their retirement. And since covid, people are more afraid of upcoming inflation, so housing prices grew even stronger in 2020 than in 2019.
- tcmart14 5y ago
mensetmanusman 5y ago
One of the interesting effect of BB divorce rates is to sharply increase the number of houses required due to more people living alone.
simonblack 5y ago
People have always "aged in place". That's why you get the phenomenon of places where every second house belongs to a little old lady suddenly becoming a 'hot spot' of young couples with prams as the little old ladies die off.

25 points by harambae 5y ago

Assisted living is a much higher level of care than a retirement community, which I think is probably the sort of place the article means. (assisted living is where you go when you can't meet all of your own daily needs anymore, not where you go when you get sick of mowing the lawn)

WalterBright 5y ago
> when you get sick of mowing the lawn I decided to landscape with weeds. Weeds thrive with no water, no pesticides, no nothing, not even dirt. The perfect lawn! Mine is completely maintenance free.

1270018080 5y ago

If you're buying a home and living in it (which is what it sounds like the boomers are doing), I can't really find room for criticism. I think having a chance to build equity in a home you live in is a great thing. If they're snatching these houses to rent out, deny others a chance at equity, and profit off of (overcharge) the less fortunate, especially during a housing shortage with no end in sight, I have a problem. Building more housing will always be the primary solution to the housing crisis, but not letting the greedy steal homes would be a nice short-term bandaid.

_lz4k 5y ago
Is it really a problem if boomers are buying second, third, or even fourth homes to rent out? This has long been a common path for the elderly to afford healthcare and living expenses in their golden years rather than relying on the government. I feel large companies and financial institutions that are buying up swaths of residential properties are trying to find a scapegoat and they have found one in boomers. I imagine we will see more propaganda pieces like this one, pinning the blame on them.
- onecommentman 5y ago
  The younger-than-Boomers (ytBs…is that an actual acronym?) have something they can do about investors buying properties. If you control the estate of Boomers who owned residential property, sell the house(s) to people who will reside there, not use it as rentals or as an “investment”. Might get less money upfront, but you will sleep better at night. Another thing ytBs (looks ugly, might not use) could do is develop aging-in-place tech to make it unnecessary to rent that second house. Aging-in-place is already much cheaper than nursing homes https://journals.healio.com/doi/10.3928/19404921-20110802-01 https://journals.healio.com/doi/10.3928/19404921-20110802-01 What new tech would allow the elderly to age-in-place more efficiently? The elderly are too old to develop it themselves…
  - _lz4k 5y ago
    I don’t agree with the premise that there is a problem with boomers buying a home and renting it out to someone who would rather rent than own. I see the problem is rather monopolies and hedge funds buying homes by the thousands and driving up the prices in select markets.

tuatoru 5y ago

Setting us up for a house price crash in ten to fifteen years, as the Boomers age into their years of disability and want to sell their houses so they can move into "assisted living" / "sheltered" housing. It's really worth having a look at the charts in [1]. People are living longer (age at death is compressing to a peak around 90 years old), but there are still about 15 years of ill health before death. Since we know the age of the baby boomers, we can predict this crash. 1.Robine, Jean-Marie, UN Department of Economic and Social Affairs, September 2021. Ageing Populations: We are living longer lives, but are we healthier? UN Ref: UN DESA/POP/2021/TP/NO.2. Downloaded from https://www.un.org/development/desa/pd/ https://www.un.org/development/desa/pd/ on 11 Oct 2021.

rsj_hn 5y ago
> Setting us up for a house price crash in ten to fifteen years, as the Boomers age into their years of disability and want to sell their houses so they can move into "assisted living" / "sheltered" housing. I'm really not sure where you are getting your numbers. Only 4.5% of seniors live in assisted living facilities. Most people will never set foot in one -- they will live independently up until they die, possibly spending a few weeks in hospice if things drag out. With new tech it is even easier now to live on your own -- e.g. you can order things delivered, there is telemedicine, grocery delivery, meal delivery, house cleaning services, uber, etc. Moreover you can now get little motors to take you up stairs, there are all sorts of automated appliances. The days of a large share of seniors needing to live in assisted living are long gone. https://www.ncbi.nlm.nih.gov/books/NBK51841/ https://www.ncbi.nlm.nih.gov/books/NBK51841/
- tuatoru 5y ago
  Yes, I put that badly. But medical and living assistance costs go up steeply after 75, and many people will sell properties to pay for them.
  - rsj_hn 5y ago
    For nursing homes, it's 1% for ages 65-74, 3% for 75-84 and 9% for persons age 85 and over. Half of all those in nursing homes are older than 85. For general expenses, there are reverse mortgages for this. But again, I'm not sure what difference it makes to sell the house before rather than after you die -- especially for really old people. It will go on the market either way. Even if you give the home to a child, they will either sell it, or move into it and sell their existing home. Either way, when someone dies, the demand for housing decreases by 1. So declining populations do lead to cheaper housing (which is a good thing in places where housing is expensive).

gruez 5y ago

The article is trying really hard to push an inter-generational conflict narrative, but it's missing a very important detail: are boomers adding/subtracting from the housing supply, on net? They are "more active in the housing market" and are responsible for more of the housing purchases, but that itself isn't really an indication of anything. If they're just upsizing/downsizing, then they're not "snatching houses" from the overall housing supply. If anything, boomers selling houses in urban centers for suburban/rural houses (I suspect boomers aren't dying to get a house in SF for the nightlife) should be a good thing for millennials. The linked zillow report hints at this, because they also mention boomers using their equity for all-cash offers. If they were buying a second house, that would indeed be bad, but I doubt this is the case. I don't think banks would give a $500k mortgage to 60 year olds.

_lz4k 5y ago
Even if they are buying second houses, I highly doubt that boomers are having anywhere near as large an impact on housing markets in relation to large corporations and financial institutions that are buying more and more residential properties. These larger organizations are pinning the blame on boomers via PR, when there is really no comparison in who has more invested. https://www.usnews.com/news/business/articles/2021-09-09/companies-step-up-buying-houses-bet-on-hot-housing-market https://www.usnews.com/news/business/articles/2021-09-09/com...
- fxtentacle 5y ago
  Great point. "nationally, investors bought more homes than they sold in the first half of this year"
fxtentacle 5y ago
In my neighborhood, old people are investing their savings into houses and then rent them out. The hope is that they'll be able to live off the rent during their retirement. And since covid, people are more afraid of upcoming inflation, so housing prices grew even stronger in 2020 than in 2019.
tcmart14 5y ago

mensetmanusman 5y ago

One of the interesting effect of BB divorce rates is to sharply increase the number of houses required due to more people living alone.

simonblack 5y ago

People have always "aged in place". That's why you get the phenomenon of places where every second house belongs to a little old lady suddenly becoming a 'hot spot' of young couples with prams as the little old ladies die off.