We had our annual market update meeting with Broker/Owner, John Collopy, RE/MAX Results. John is very unique in his delivery and style. It’s too bad there weren’t more people like him in the real estate brokerage business. He tells it like it is!
One of the items we were reviewing was some macro demographic information. Consider this…there are about 35 million people in the “mature” category – say 65 years or older. There are about 80 million Baby Boomers, the oldest of whom are just now approaching retirement age. The next generation moving up behind the Boomers is Gen X. They represent about 48 million people.
Let’s do the math…80 million people need to sell to 48 million people. Does anyone see a problem with this? Oh…oh, but the Gen Y’s will bail us out. Really? Gen Y represents 74 million people and they are just coming of age to be home buyers. But they aren’t interested in buying the Baby Boomers 4000-5000 square foot 5 BR, 4 BA, 3 Car Garage 2 story walkout home in the suburbs. Gen Y is likely going to want to live closer in and they certainly don’t want to buy a big showy house.
Gen X cannot absorb the homes that the Baby Boomers will be selling. To put it another way, it’s likely to be years of sluggish home sales of these bigger properties in the 2nd ring suburbs throughout America. In fact, with that big of a gap between the Boomers, the Xers and then the Yers, it may never come back to what it once was.