There is a new housing boom and it’s coming from baby boomers who are selling their homes and downsizing into smaller ones. It’s a good thing for new homeowners and those upsizing as well.
As the children of baby boomers leave home for college and beyond, their parents are finding that their big homes are just a bit too big. They are also finding that they are facing a future that could mean lower incomes and inability to make larger payments on things like utilities, real estate taxes and such. The answer? Sell that big home that has the higher utilities and taxes. Use the equity as a nest egg. That also means that they will be looking for a smaller home.
That’s good news for owners of smaller homes who want to upsize for two reasons
The first is that there will be competition for their smaller homes: first time buyers and the downsizing boomers. Competition means possible bidding wars and higher prices. Those higher sales mean more money to purchase the bigger home with less debt. That’s always good news. The second reason is the higher chance of getting a cash sale. It means a faster settlement and less red tape for both sides.
Bigger homes and upsizing families
Then, of course, there is the homes that the boomers are vacating. They are the bigger homes that the upsizing families are looking for. With more and more of them available it will mean better prices for those buying. Yet another plus for those smaller home owners.
For baby boomers it means buying a home without the need for a mortgage, smaller utility bills, lower real estate taxes and costs. It could also mean adding money into the retirement sources of income.
So this housing boom of sorts is a win win for both baby boomers and the owners of the smaller homes they want.