This article is written by a professor at the Wharton School who has a book coming out this week. It appears we have a glut of boomers – will we stay put, or sell the family homestead (once the covid is solved) and explore the world during retirement?
Population aging is a powerful force. By 2030 the population above age 60 will have grown so much that other generations like millennials and Gen-Z will be outnumbered by them in Europe, China, Japan and the United States.
Each day, 12,000 Americans celebrate their 60th birthday; in China, 54,000; and in the world, about 210,000, according to the United Nations Population Division. The pandemic will only accelerate this trend given the predictable decline in fertility — which tends to occur whenever unemployment is high — and the shifting demographics of cases and deaths, which are trending younger as time goes by.
The 60+ crowd will become very important economically for three reasons.
Boston Real Estate Worth
First, they own more than half of the net worth around the world, a proportion that reaches 80 percent in the United States, according to a study by the Federal Reserve. Second, the same study concluded that the net worth of seniors is more evenly distributed than among younger age groups, and poverty rates are also lower. And third, their incomes tend to be more resilient because many of them depend on pensions or investment income, and they can do some work on the side to cover potential shortfalls.
Not all seniors are financially secure, but they tend to be less exposed to large-scale financial disruption during episodes of crisis. Moreover, there are 25 percent more women above the age of 60 than men, they tend to be much better at managing their money and making it last, and they account for a smaller percentage of COVID-related health problems and hospitalizations, mainly because they heed the advice of health authorities and they have more robust anti-viral immune responses to begin with.
The Gray Real Estate Market
The gray market is quickly becoming in vogue because ever larger proportions of seniors are enjoying life by using their income and wealth wisely to procure goods and services that enhance their experiences.
Moreover, a 70-year-old nowadays lives the life of a 50-year-old in the 1980s.
The pandemic has also accelerated the technological savviness of this group, and not just in the area of e-commerce. In fact, a study in the Journal of Gerontology found that use of the Internet increases cognitive functioning rather than vice versa. Myriad new applications in virtual reality, robotics, and artificial intelligence are seeking to capture a rapidly growing market.
Other areas of technology will help seniors live longer and more fulfilling lives. Virtual reality can stimulate motor functions and the overall performance of the nervous system, and it can help reduce loneliness, a key problem afflicting large numbers of people at advanced ages. Artificial intelligence and robotics will also contribute to quality of life. Over the last decade, Japanese companies have invested heavily in robotics to aid with daily tasks like lifting weights, conduct physiotherapy sessions, and provide for companionship.
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All the talk today is about the Millennial’s and how they are entering the Boston downtown real estate market. But lets not forget about the baby boomers.Regardless of where you live, experts are expecting that Baby Boomers will have a major impact on the local housing market.
That’s because this sizeable portion of the population is comprised of 76.4 million individuals. And many of them are expected to make major moves over the next several years as they continue to retire.
To that effect, I wanted to share with you the top 5 Baby Boomer real estate trends to watch for in the coming months of 2019.
The Top 5 Real Estate Trends for Baby Boomers
Although many Baby Boomers plan to move to the Sunbelt when they retire, others may be motivated by different factors.
For instance, some may be motivated by staying closer to families. Others may be looking for the least expensive place to live. Still others may be more interested in moving to a place with a high quality of life for seniors.
Thus, regardless of where you live, it’s important to consider the following Baby Boomer trends:
Boomers want to pay off their mortgage.
Many Baby Boomers own their own Boston condos. They’ve been paying a mortgage for decades on their downtown Boston real estate. Thus, one of their primary goals is going to be to finally pay off the mortgage and own their high rise condo outright. In fact, for many, paying off the mortgage is a crucial consideration before they’re willing to retire.
They want more convenience.
This may look like a smaller home with less maintenance and less work, but it may not. Baby Boomers also care about living in homes that have modern appliances, energy-efficient doors and other features that will make their life easy. As such, many are also opting for Boston high rise condos such as Charles River Park or other buildings with elevators because of their bad knees, bad hips, etc.
Baby Boomers want a walkable neighborhood.
They’ve already spent a lot of time in their car, what with commuting to work, taking their kids to and from hobbies, etc. So now they’re trying to get back to simpler times, where they lived just a couple of blocks from the grocery store or the local restaurant. They want to be able to access the amenities they want and need without having to always get in the car. Self sufficient neighborhoods such as Beacon Hill.
They want to remain on their own.
In fact, according to a Merrill Lynch survey, only 10 percent of Baby Boomers say they want to move into any kind of retirement or age-restricted community. Instead, they want to stay in their own Beacon Hill homes, in their own neighborhood and be with their own friends.
Baby Boomers want to stay close to their loved ones
This is also a high priority for residents. They not only want to be close to their children, but also their grandchildren as well. Proximity to loved ones is certainly key with this segment of the population.
Boston Real Estate and the Bottom Line
We hope you’ve learned something new after reading today’s Boston downtown real estate blog. The Baby Boomers will undoubtedly have a huge impact on the downtown Boston real estate market as they prepare for where they want to live their Golden Years.
Please check back here soon to learn about more trends that may impact your local housing market.