This trend of older empty nesters dominating the large home market is fairly new. A decade prior, young families (then Gen X) were just as likely (19%) as empty nesters (then the silent generation) to own large homes (16%), Redfin says. But one thing that’s remained relatively constant is that baby boomers with no kids owned the largest share (26.5%) of three-bedroom-plus homes.
High prices, elevated mortgage rates and a housing shortage has made buying a home a challenge for younger generations — even for the rich. Redfin’s calculations show that 2023 was the least affordable year to buy a home in the company’s records.
Baby boomers are sitting pretty and have little motivation to move from a position of strength. Redfin data shows that 54% of boomer homeowners don’t have mortgages. Of those who do, they’re locked-in at a much lower percentage than current rates, which are hovering at around 7%.
So, it’s true: millennials got a rotten deal when it comes to buying a home. Though it may be difficult for them to look on as boomers keep living in large homes they longer need, there are still other factors that have contributed to the housing crisis.
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Won’t somebody think of the children?
Millennials can pin part of their housing woes on one specific old guy: Uncle Sam.
Redfin’s chief economist, Daryl Fairweather, told Business Insider that there’s political incentives to help boomers stay put.
“Baby boomers are a very large demographic, and they vote more than millennials do,” he said. “Things like property taxes, carve-outs or exemptions for seniors — those are voted for by seniors who benefit from those laws.”
Plus, there are decades of zoning laws that make building anything other than single-family homes impossible.
But millennials are getting creative to deal with the poor housing market. Some are buying homes with friends or looking to the less-expensive housing markets of the Midwest and South.
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