Will the Silver Tsunami Wash Away Buyers' Housing Woes?
The Baby Boomers, the generation born between 1946 and 1964, are entering a new chapter in their lives. As they reach retirement age, many are considering selling their long-held homes and embarking on a new adventure. This phenomenon, known as the "Silver Tsunami," is expected to have a significant impact on the housing market in the coming years.
A Generation That Owns Homes
Having come of age in an era of prosperous middle-class living, over 70% of Baby Boomers currently own their homes. As these 73 million Americans downsize in the decades ahead, their collective real estate decisions will shape markets nationwide. In today's conditions of rock-bottom inventory, this flood of new listings could provide urgent relief. Many younger home buyers have just given up with the current severe lack of available homes to purchase and high mortgage interest rates.
Baby Boomers Hold Key to New Jersey’s Housing Future
New Jersey: Inventory Deficit Meets Boomer Supply
New Jersey offers a prime example of how current market dynamics could interact with the Silver Tsunami. New Jersey's housing supply in December 2023 was at a significantly lower level compared to previous years,. Here's a breakdown:
Total homes for sale: 21,159, representing a 19.2% decrease year-over-year from December 2022.
Months of supply: 2 months, down from 2.5 months in December 2022, indicating that it would take 2 months to sell all available homes at the current sales pace. This signifies a tight market heavily favoring sellers. A “normal” market is 6 months of inventory.
New listings: 4,276, down 3.7% year-over-year, showing a slight slowdown in new inventory entering the market.With demand far outstripping supply, sellers often receive multiple offers. The influx of Boomer-owned properties could help satiate buyer demand and steady prices.
The Silver Lining
The low inventory plaguing 2023 buyers may find resolution from an unexpected source - Baby Boomers. As this generation enters its next chapter, their collective real estate choices will shape markets for years to come. With planning and foresight, their wave can lift the market up rather than overwhelm it.
