While it’s true that Millennials are still renting at a higher rate than any other generation and mostly avoid buying houses of their own, their parents’ generation isn’t far behind them. Baby Boomers are renting at a higher rate than ever before – but for much different reasons than Millennials.
Between 2009 and 2015, the number of renters aged 55 or above rose 28 percent, while those aged 34 or younger only increased 3 percent, according to Census data recently compiled by RentCafe.
Also partially due to foreclosures during the great recession, homeownership among Boomers slipped 5 percentage points between 2005 and 2013, according to Jennifer Molinsky, researcher for the Joint Center for Housing Studies of Harvard University.
As such, more than 5 million Baby Boomers across the nation are expected to rent their next home by 2020, and account for more than half of the nation’s renter growth over the past decade. Some Boomers want to stay close to the neighborhoods they have lived in for decades, while others are following their Millennial children to cities.
Baby Boomers are at a point in their lives where less is more. Their children have moved out and they’re finding that they don’t need as much space as they once did. Whether it’s in an urban center or the suburbs, Baby Boomers are finding apartment living to be very attractive in their near-retirement and retirement years.
Luxury, all-inclusive apartment buildings that offer swimming pools, gyms, on-site maintenance, and other such amenities are drawing Baby Boomers who no longer wish to mow a lawn or keep up with the challenges of homeownership. While these upscale rental communities might make some Millennials clutch their wallets, Baby Boomers are finding that rental rates are still much lower than their mortgages and insurance.
It will be interesting to observe the type of housing Gen Z, the generation after Millennials, prefers once they graduate college and begin entering the workforce en masse. Research shows that they are a more practical, financially conscious generation than Millennials. Does this mean they will move right to homeownership, or will they embrace renting like their predecessors? Only time will tell.
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