The big issue is the huge number of foreclosures we are seeing. Jim Gillespie, CEO of Coldwell Banker Real Estate said it really depends on how long it will take to work through the foreclosures in the system. No one seems to have a definitive answer on the timeline. All of this is based on Americans going back to work and consumer confidence coming back. That’s the big overhang.
However, the survey pointed out the baby boomers desire to purchase and own a home remains strong. The reason? Gillespie believes the American dream of owning a home is alive and well.
Home ownership is still American dream. “60-75% of Americans say investing in a home is the safest or second safest investment,” said Gillespie. It all boils down to life style. “Long-term future of the housing market looks good,” added Gillespie.
Gillespie pointed out a lot of the young people are living with their parents, grandparents or other family members. Once we see job creation, consumer confidence bounce back, Gillespie expects demand to pick up. Right now, many young people out there are renting because the economy is weak, there may be not as much funds available to them.
Is this just a temporary trend? Gillespie dismisses the idea we are turning into renter’s society.“That is not the case,” added Gillespie.
Currently, the baby boomer generation accounts for 79 million Americans. The survey divided up the boomers into two groups, younger baby boomers (ages 47 -55) and older baby boomers (ages 56 – 64). “31 percent of respondents say that younger baby boomer clients are selling their current home and looking for a larger home, compared to 6 percent of older boomers,” based of results of the survey.
4 out of 5 agents said that ‘older’ baby boomers are two times more likely to want to downsize than ‘younger’ ones. Gillespie stressed that half are downsizing for simpler lifestyle, not downsizing for economic reasons.
According to the survey, “49 percent of agents say the primary reason boomers want to downsize is because they desire a simpler lifestyle, while only 28 percent said the leading reason boomers are downsizing is to save money.”