Boomers not as interested in second homes as previously thought
By Melissa
Wirkus
Baby boomers have long been thought of as one of the
main staples to keeping our housing market alive and
kicking.
Not only do they make up a large portion of America’s
population, but they also have money to spend.
It was once believed that baby boomers were one of the
main patrons of the second-home buyer’s market,
but new data suggests something different.
According to an October 25, 2006 article by Amy Hoak
of The Wall Street Journal, “Maybe boomers aren’t
so keen on second homes,” looks into some data
that contradicts what was previously thought.
“Baby boomers may not be as in love with second
homes as once thought. The
rate of second-home ownership among 50- to 60-year-olds
has remained flat during the 12-year period between
1992 and 2004, according to a report sponsored by Radian
Group Inc. and the Research Institute for Housing America
of the Mortgage Bankers Association.”
This comes as surprising information, since most experts
and analysts thought baby boomers were buying second
homes in record numbers, but it must have been all anecdotal
evidence.
“Early boomers were no more likely to own a second
home than older generations of homeowners. Those who
do have a second home are using the residence on a limited
basis, too: One-half spend two weeks or less and two-thirds
spend four weeks or less per year in their second home,
the report found.”
“About 12% of second-home owners
said they intended to sell their main home and eventually
use their second home as their primary address -- debunking
speculation to the contrary.”
The report for this information is called, “Housing
Trends Among Baby Boomers,” and was conducted
by Gary V. Engelhardt.
The study was released during the MBA’s national
convention in Chicago on October 23, 2006.
Most of the information found in the study was pulled
from reputable sources such as the U.S. Census Bureau
and the 2004 Health and Retirement Study.
“‘There have been relatively few scientific
studies on second-home ownership and mortgage activity,’
Doug Duncan, MBA's chief economist and senior vice president
of research and business
development, said in a news release. ‘The report
indicates that baby boomers are not acting differently
than their parents when it comes to second-home ownership.
However, the baby boom cohort is so large, even if they
follow typical buying patterns, they will have significant
impacts on many local housing markets.’”
This means that areas that are popular to have second
homes, such as ski-towns and beach cities could be affected
by the patterns of a relatively large amount of boomers
coming in or out of the area.
“The study found 43 million U.S. households headed
by someone age 50 or older owned their main residence
and 6.6 million homeowners of that age group owned a
second
home. Those second homes were often located in well-known
vacation areas.”
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