Baby boomers have a wide variety of housing needs in the future, depending on their retirement plans — or lack thereof — according to a study by the National Association of Realtors®.

Most of the 78 million baby boomers are far from retirement, with diverse plans and timelines, resulting in different housing requirements and significant shifts from patterns established by earlier generations.  The comprehensive study is based on a survey of nearly 2,000 American baby boomers born between 1946 and 1964 — the largest generation in U.S. history; the survey was conducted for NAR by Harris Interactive®.

David Lereah, NAR’s chief economist, said baby boomers are living longer and are different from previous generations because they have no set path for retirement and have more varied circumstances in life.  “The differences from past generations — and between baby boomers themselves — will have a significant impact on housing needs over the next 10 to 20 years that is very different from the World War II generation, and many boomers simply don’t know how they’ll retire,” he said.

“A significant portion of baby boomers married later in life and had children at a later age, which means many will continue to work beyond the traditional retirement age.  Older boomers are thinking about retirement, but one-third expect to go back and forth between periods of work and periods of leisure, and another 35% want to work at least part-time or start a business — all of this will have an impact on the kind of homes they buy as well as where they buy them,”  Lereah added. The median age at which baby boomers expect to stop working is 70, but 27% say they never intend to stop working.

He said most baby boomers are currently in the workforce, a good portion of them have children living at home, and boomers remain a driving force in the housing market.  “Just over a quarter of the boomer generation is aged 55 to 60, which is when many people traditionally begin to focus on their retirement plans, but analysis of the survey suggests they are more likely to stay in the workforce longer and will be less likely to downsize than previous generations — the leading edge of the boomer generation is the key to future housing impact.”

“Because they will be in the workforce longer, boomers will postpone purchase of retirement property and won’t be making those moves as early as assumed,” Lereah said.

Most boomers live in two-income households, with a median income in 2005 of $64,700, which is 31% higher than the median for all households.  This generation makes up 37.5% of U.S. households, but receives nearly half of all aggregate household income. 

“This translates into a lot of purchasing power, and helps to explain why eight out of 10 boomers are home owners,” Lereah said.

Ten percent of boomers indicate they plan to buy some form of real estate within the next year, which corresponds with U.S. Census Bureau data that shows 3.5 million boomer households moved during the last year.  Two-thirds are considering a primary residence, but the rest are thinking about land, second homes or commercial property.

Half of boomers who live in an urban area would like to retire in a small town or rural area.  Their ideal retirement location characteristics include a lower cost of living, being near family, quality health care, better climate and being near a body of water.

More than a third of all baby boomers want to retire in an urban or suburban setting, motivated by quality health care and cultural activities.  Half of boomers said they would consider living in an age-restricted community.

For more study results, visit www.realtor.org/press_room/news_releases/2006/baby_boomer_study_06.html.

The study can be ordered by calling 800-874-6500, or online at: www.realtor.org/babyboomerstudy.  The cost is $50 for NAR members and $125 for non-members.

Harris Interactive Inc., based in Rochester, N.Y., is the 12th largest and the fastest-growing market research firm in the world, most widely known for The Harris Poll® and for its pioneering leadership in the online market research industry.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.

The content of this article was excerpted from a press release provided by the National Association of Realtors. [Return to top]