edit: Seeing the flood of downvotes I'll give some data. Home ownership increases with age. 60+ers leaving their homes from death, poor health or inconvenience will be supplemented by today's 40+ers over the next 20 years. https://www.census.gov/library/stories/2018/08/homeownership... . We were in the same situation 20 years ago, 21 years ago, 22 years ago, and so on.
Does that somehow change how many current 60 year olds will be moving out of their house in the next twenty years? A demographic change isn't what's being discussed.
It’s very different. I’m fortunate to be in a good place from a retirement perspective, but at this point my parents had made a 10x return on their home that they purchased in late 70s NYC, plus a legacy pension, plus a retirement healthcare.
Most of the housing wealth will be eaten up by health costs. With families moving away and people retiring to alternate locales, property wealth will be seized and sold off by the county to pay for Medicaid.
Many of the folks in our field are doing great, but tech is boom/bust and people are making way too much money now.
> Most of the housing wealth will be eaten up by health costs
Unless the home is somehow stripped down or otherwise damaged, the intrinsic value of the housing wealth will not change; it just is owned by a different entity.
The issue is not in 2040, it's between now and 2040. For example, the current population in the 40-45 age range is nearly 2 million less than the 55-59 range. So sometime between now and 2040 (probably around 2030) we are going to see a decrease in the number of newly retired individuals. By 2040, the first wave of millennials will start retiring, which should make the 'silver tsunami' less of an issue.
I agree there will be a small peak, but there is no cliff on the other side. 5 years is a pretty small range to look at 10 years you get the following:
There are 37.5 million folks in their 60s now.
There will be 40 million folks in their 60s in 2030
there will be 39 million folks in their 60s in 2040.
The point is that there is a surge of baby-boomers who will die and the number of people younger than them are a significantly smaller group, so there will in fact be a surge in available housing.
This argument is missing the point - the questions is not how many people will be of age X in 2040.
It is about how many homes will be released due to owners passing away in 2020 vs 2040.
The very fact that there will be more older people in 2040 also contributes to getting more homes released.
What the statistics does not even consider is what happens if we manage to extend life, even by say 10 years. A completely different picture emerges where homes get even more expensive.
There's a precedent for this: schools. A lot of towns had to build out to accommodate the boom, then deal with declining enrollment for GenX, then another increase for the "echo" generation that we now call millennials. If you want to know what retirement homes will go through, look at what schools already did.
Why do demographics matter? It's completely missing the point. The only thing that matters is that the population is still growing and therefore there will be no housing shortage.
edit: Seeing the flood of downvotes I'll give some data. Home ownership increases with age. 60+ers leaving their homes from death, poor health or inconvenience will be supplemented by today's 40+ers over the next 20 years. https://www.census.gov/library/stories/2018/08/homeownership... . We were in the same situation 20 years ago, 21 years ago, 22 years ago, and so on.