Why are older homeowners planning to stay in their homes as they age?

According to a recent survey by Redfin, the majority of baby boomers intend to remain in their current homes as they age. Here are the key findings from the February survey that was completed by over 3000 homeowners and renters:

Aging in PlaceMore than three-quarters (78%) of older American homeowners plan to stay in their current home as they grow older. This preference for aging in place is the most common plan among older homeowners.

55+ Communities: The next most common plan is moving to a 55+ community. Approximately one in five (20%) baby boomers are considering this option or have already made the move to such communities.

Other Considerations: Beyond staying put or moving to 55+ communities, some baby boomers are also contemplating the following options:

  • Moving in with adult children
  • Transitioning to an assisted-living facility
  • Living with friends

Financial Incentives: The decision to stay in their current homes is often driven by financial incentives. Factors such as low mortgage rates, tax benefits, and familiarity with their existing property contribute to this choice.

Impact on Housing Market: Baby boomers’ preference for aging in place has implications for the housing market. It could prolong the shortage of homes for sale since many homeowners are holding onto their properties. This shortage affects inventory levels, making it challenging for younger generations to find suitable family homes.

Empty-Nest Boomers: Interestingly, empty-nest baby boomers own 28% of three-bedroom-plus U.S. homes, while millennials with kids own only 14%. This underscores the significant impact that baby boomers have on the housing market due to their higher homeownership rates.

Daryl Fairweather, chief economist at Redfin stated: “Older Americans are aging in place because it makes financial sense, but also because it’s human nature to avoid thinking about challenging scenarios such as needing help as you get older…In reality, many homeowners and renters will need to move somewhere that better meets their needs as they age, like a senior-living community or a one-story home in an accessible neighborhood.”

The trend of baby boomers staying in their homes as they age is typically a reflection of financial considerations. However, this large percentage of empty-nesters remaining in their larger family homes is a contributing factor to the ongoing housing shortage for younger generations. A possible way to reverse this trend is to increase the amount of affordable homesites catering to senior living… smaller single-story homes, with easy access to shopping and healthcare facilities.

Buying or selling a home is a major life event, and usually the largest single purchase someone makes in their lifetime. If you are considering a move, we strongly encourage you to speak with a trusted advisor for guidance throughout the process.