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Old 03-10-2012, 07:02 AM
 
29,782 posts, read 34,871,258 times
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Good article with food for thought about the notion of selling your current home as part of your retirement plan. Often mentioned in the forum but this is food for thought.
News Headlines

Quote:
Baby Boomers putting their house up for sale could flood the market in coming years, while the younger generations may not be interested in buying, a new report says.
Quote:
"Certain areas of the country are better off than others," Pendall says. "But if we look at the Northeast and Midwest, seniors are going to be putting homes on the market and moving to warmer climates
Varying opinion in the link, I just highlighted a couple as a sampling of the article.
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Old 03-10-2012, 10:27 AM
 
Location: Prescott AZ
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Oh my. More bad news. I have to sell 2 houses to have enough to live on. Not looking forward to it at all....
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Old 03-10-2012, 12:43 PM
 
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Every location is different has to the numbers of homes on the market.Some areas have thousands and more beig foreclosed on since it restarted.I sold a home just about 6 months ago and moved. Its not just the nmbers its the abilty of buyers to get a loan i thsi tightne credit market. But eventually with few being added over last four eyar mant areas will haqve a shortage.I know that rental honmes i my area are almost ompossible to get unless you start at 7am alling. Anoither probe3lm I see is people buyign higher end homes they never culd ahve afforded in the recent past but the cost to upkeep a 500'000 dollar home really has not gone down plus to insure at replacement value is the same.
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Old 03-10-2012, 05:33 PM
 
Location: Near a river
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Baby Boomers putting their house up for sale could flood the market in coming years, while the younger generations may not be interested in buying, a new report says.

I've been saying this for the past several years on CD. One reason why I've strongly suggested retirees move quickly rather than wait. On top of the elderly-elderly (our parents) vacating their homes en masse, the boomers are doing so as well, to downsize or relocate. Many of these homes are older, yet owners are hoping to fetch a price they think they ought to get. But for similar price many of the young families can get much newer homes with significant upgrades. They may not want the space layout and limitations of grandma's house. Many of the old neighborhoods are not prime anymore, some with increasing crime rates. Not to mention that with today's job insecurities and the need to be on the career move, younger folks would rather rent. And, as TexDav points out, tightened credit means way fewer buyers.

This, on top of continued foreclosures, is going to send home prices down or at least keep them depressed until the boomer generation passes. I think boomers are going to get their best dollar yesterday, but certainly today rather than tomorrow.
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Old 03-10-2012, 05:55 PM
 
Location: WA
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I think this is a larger/broader issue than just home sales... we are moving through an economic cycle driven by demographics. A very large segment of the population is moving from productive years where there was expansion, spending, and saving to a time where there will be downsizing and more reliance on spending savings, pensions, and government programs.

Because this segment of the population (boomers) is so large and the next segment relatively small there will be great pressure on society. We do not appear to be even aware of this cycle so we are totally unprepared. Look towards the squeeze in Japan to see what happens to a society with savings or Greece as one with no resources in reserve.

Yes there will be another housing crash among all the other crashes in this bust part of the cycle.
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Old 03-10-2012, 06:38 PM
 
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Well, there's already been a housing crash due to speculation and bubble behavior.
"Baby boomers" cover some 75 million people across an 18-year span (although you have all heard my rant that "boomer" is only births from 1946 to, at most, 1960, and the rest is marketing).
Increasingly, people are not selling their houses and moving to warmer climates, the exodus to Arizona and Florida being largely a thing of the past.
Also, if people owned their homes for a long enough time, they'll get out OK no matter what, not if they bought it in a bubble mentality or took out the equity for other stuff.
Until houses cost the proper ratio to income, they will be hard to sell, and should be. They were never meant to be ATM's, plus, the old rule of thumb was along the lines of not expecting to break even until owning for at least seven years, due to the costs of financing and all.
I realize some people have to sell in shorter periods of time, but it was never written that one should plan on it as a retirement plan. At least, it was never written by anyone who was right.
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Old 03-10-2012, 07:22 PM
 
Location: East of Seattle since 1992, originally from SF Bay Area
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It just depends on where you are and how long you have been there. True that a lot of people that bought fairly recently in hard hit areas like Stockton, CA expecting 10-15% appreciation are now going to have to sell for half what they paid and wait a long time. We have been in this house 20 years and it's still worth more than double what we paid, despite a drop of 250,00 in the last 3 years. We are in an area where people working at Microsoft and Boeing like to live so houses get snapped up quickly. A lot could happen before we are ready to sell, but if we made a move now and went to a less expensive area we'd still get enough to pay cash for a place. My parents are out in the country in a much less expensive area and have only been there 14 years, and their property is worth 3 times what they paid despite the drop. It happens to be an area highly desirable for retirees and on acreage. Some other family in the SF Bay Area have homes that dropped from over 1 million to about $700k, but they paid under $200k for it back when. I could go on.
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Old 03-10-2012, 09:12 PM
 
29,782 posts, read 34,871,258 times
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Quote:
Originally Posted by cdelena View Post
I think this is a larger/broader issue than just home sales... we are moving through an economic cycle driven by demographics. A very large segment of the population is moving from productive years where there was expansion, spending, and saving to a time where there will be downsizing and more reliance on spending savings, pensions, and government programs.

Because this segment of the population (boomers) is so large and the next segment relatively small there will be great pressure on society. We do not appear to be even aware of this cycle so we are totally unprepared. Look towards the squeeze in Japan to see what happens to a society with savings or Greece as one with no resources in reserve.

Yes there will be another housing crash among all the other crashes in this bust part of the cycle.
Very True
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Old 03-11-2012, 05:11 AM
 
Location: Whereever we have our RV parked
8,787 posts, read 7,707,284 times
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I saw this article in some other news source, and its totally bogus. This article has nothing to do with boomers selling their homes and not finding enough buyers. The article noted that the areas where this might be a big problem is in Mich., and the Northeast. Well, what areas have been hit hardest by the Great Recession, those plus Calif. So its not really about just boomers, but all kinds of people in those areas not being able to sell their houses. (However, I must add that its usually not an issue of being able to sell the house, its the problem of selling the house for the price I want.)

But this isn't an issue just for boomers in those states. All kinds of people bought big expensive homes, even here in Texas, trying to impress their friends and family, and now selling these expensive homes is getting very difficult. There just are not enough buyers? Why? For years people bought big homes without fear, thinking that the would continue to appreciate in value. That has all stopped for the most part. Therefore the big home has become a big drain on the pocketbook, not an opportunity to make money.
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Old 03-11-2012, 07:14 AM
 
29,782 posts, read 34,871,258 times
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Quote:
Originally Posted by Prairieparson View Post
I saw this article in some other news source, and its totally bogus. This article has nothing to do with boomers selling their homes and not finding enough buyers. The article noted that the areas where this might be a big problem is in Mich., and the Northeast. Well, what areas have been hit hardest by the Great Recession, those plus Calif. So its not really about just boomers, but all kinds of people in those areas not being able to sell their houses. (However, I must add that its usually not an issue of being able to sell the house, its the problem of selling the house for the price I want.)

But this isn't an issue just for boomers in those states. All kinds of people bought big expensive homes, even here in Texas, trying to impress their friends and family, and now selling these expensive homes is getting very difficult. There just are not enough buyers? Why? For years people bought big homes without fear, thinking that the would continue to appreciate in value. That has all stopped for the most part. Therefore the big home has become a big drain on the pocketbook, not an opportunity to make money.
Many boomers in those areas would have home equtiy from the sale and most importantly transplanting as part of their retirement plans. Many of them are folks who spurred the growth in areas of the south and south west. Yes it has impact on many others but like this forum it is ok to disect a topic and focus on one component of it. What ever the reason seniors in many areas are having multiple problems implementing their retirement plans and selling their house is one of them. I suspect forum readers know folks in that situation. Especially folks who have transplanted and chat with friends and former neighbors. Hmmm come to think of it I just visited my home town and had multiple conversations on that topic including one with a senior realtor friend of mine. We sold our house in early early/mid 2007 near the peak and have heard 100's of time how forturnate we were and how we were smart retiring early at the top of the market and what retiring now would mean for them. Sale prices have stayed relatively high but it is the cost of making the house the most desirable and that can mean 10-30K easily to do that.
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