If there’s one group poised to sell their home, it’s the boomer generation – those aged 57 to 75 years old. And in today’s hot market and high prices, this group is cashing in.
Sellers nationwide made a median $66,000 on the sale of their homes –a $6,000 increase from the previous year and 99% or more of their asking price, according to the National Association of Realtors® 2021 Home Buyers and Sellers Generational Trends Report.
The largest group of sellers — 43% — is baby boomers. Boomers sold their homes for a variety of reasons, but the top two are to buy a similar sized home closer to family and friends or to downsize.
Those aged 55 and younger took a different approach: they often upgraded to a larger, more expensive home relatively close to where they now live.
“In a real estate market that is tipped in the favor of sellers, boomers and older homeowners are really the ones holding the cards,” says Realtor.com® Chief Economist Danielle Hale. Those who are selling homes can use the profits to help them buy new ones, she adds, pointing out that they’re “generally better equipped to deal with market conditions.”
On the other side of the transaction, millennials made up the largest share of buyers, at 37%. And first-time buyers made up nearly a third of successful buyers.
The report is based on 8,200 new homeowners who purchased a home from July 2019 to June 2020 and responded to a 131-question survey. The period includes the first four months of the stay-at-home phase of the COVID-19 pandemic.
Multigenerational housing – or homes that house adult siblings, adult children, parents or grandparents – has also been on the rise. After stay-at-home orders went into effect in March, the number of multigenerational home buyers rose by four percentage points to 15%, according to the report.
Last year, about 12% of buyers purchased multigenerational homes and 18% of homebuyers between the ages of 41 to 65 purchased these residences. These Gen Xers needed space to accommodate aging parents, who might need assistance, and grown children.
“There are a variety of reasons why large families and extended families are opting to live together, one of which is that it’s a great way to save money,” said Jessica Lautz, NAR’s vice president of demographics and behavioral insights. “Also, in light of the pandemic, many grandparents and older relatives found that being under a single roof – quarantining with family rather than away – worked out better for them.”
The second most likely group to buy a multigenerational home are those ages 75 to 95. They were also most likely to purchase senior-related housing, at 27%.
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By Tom Kalinski. Tom is the broker/owner of RE/MAX of Boulder, the local residential real estate company he established in 1977. He was inducted into Boulder County’s Business Hall of Fame in 2016 and has a 40-year background in residential and commercial real estate. For questions, e-mail firstname.lastname@example.org, call 303.441.5620 or visit boulderco.com.