Family Structure Changes Impacting Home Buying - Financing

August 8, 2007

Changing family structures are impacting home buying and financing preferences. Many Baby Boomers are now empty-nesters and are seeing their parents aging. Such factors influence decisions on the type and location of housing they now need and want. “Boomers will drive housing for at least the next 20 years,” said Tim Sullivan, president of Sullivan Group Real Estate Advisors. Housing units sold to or occupied by 55-plus households will account for more than 370,000 housing starts this year, according to a report from the National Association of Home Builders.

Households headed by someone age 55 or older account for 21 percent of new homes sales and 18 percent of the total new home buying market. Senior-oriented communities, including both age-qualified and non-age-qualified, account for about six percent of the total home buying market. “There are more elderly people everywhere on earth,” said Andrew Zolli, a consultant for NAHB. “People are living longer and having fewer children. The United States now has the largest number of older and younger people in its history, creating an `hourglass’ that will affect the workforce, health care and culture.”

Increased longevity means that many people will have to work more years than they planned, and that companies will see a rise in older, yet healthy and energetic employees. Boomers will take advantage of this longevity bonus by creating a whole new life stage that is neither all work nor all leisure, Sullivan said. That trend will influence the home buying and financing decisions of persons entering their senior years.

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