A Downsizing Boomer May Be In For a Surprise

By
Education & Training with House Proud Ottawa-Ontario-Canada
http://actvra.in/r7q

This is a story that is being repeated all over the country.  Boomers want to downsize.  This is hardly a surprise.   The surprise or even shock is that it is going to cost them money to live in less space.  To some, it is so appalling that they have decided to stay in their current home.  

Boomers own their home in the suburbs.  Most are mortgage free.  The home has four bedrooms, three baths, a family room, a rec room in the basement, two or three car garage and a huge yard full of trees and shrubs and maybe a pool.  Okay, there may be variations of this but the essence is - the boomers own family friendly property.  Now......  The kids have finished school and left the nest.  The Boomers are rattling around a big house and find that they live in the kitchen - family room space and their bedroom.  It seems that it is time to move to something smaller.

Here is the rub.  The new home or condo may cost more than the proceeds from the sale of the big home in the suburbs. What?  

  1. The market has reacted to the demand for large condos and retirement homes by placing a premium on the sales price.  Remember, the Boomers are a tidal wave moving through demographic data.  If you, a Boomer, are thinking of downsizing then so are millions of your fellow 1946-1964 birthday buddies. Simple supply and demand economics at work.
  2. Your lovely home is a wee bit tired.  Forty plus years of the same kitchen, with the wrought iron railings, pink carpet, parquet flooring and paneled rec room is telling the story.  Although you have house size you have a house waiting for updating and renovations.  Your home is not competitive.  It is not giving Buyers what they want in updates.
  3. You want to move but you are certainly not going to settle for apples to apples.  Your tastes are now refined and you want granite and a bungalow backing on a golf course with grounds keepers or the whole top floor of a condo in the downtown area.  You are selling a MacIntosh apple to buy an organically grown Star Fruit.   Would you be happy buying the little bungalow down the block from your current home with the need for the same updates as your current home?  Would you be happy with the location?   No?  

After finding out that their home is not the gold mine that they hoped for, many potential Boomer Sellers make the decision to stay in their current home. In some cases, the Boomer will update the family home, adjust the buying expectations and make the move at a later time.  

Photo Credit:  UK Baby Boom and Bust by David Willets

 

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Re-Blogged 16 times:

Re-Blogged By Re-Blogged At
  1. Carri Schoeller 01/11/2012 12:20 PM
  2. Cheryl Ritchie 01/12/2012 07:45 AM
  3. Jimmy Phan 01/12/2012 09:37 AM
  4. Jill Banks, 01/12/2012 10:44 AM
  5. Bridget McGee 01/12/2012 12:15 PM
  6. Gail Robinson 01/12/2012 01:03 PM
  7. Courtney Cooper 01/12/2012 01:51 PM
  8. Debbe Perry 01/12/2012 08:12 PM
  9. Laurie Clark CRB Angel Realty LLC Your Monument Realtor 719-502-6572 01/12/2012 08:19 PM
  10. Lyn Sims 01/13/2012 03:52 PM
  11. Ty Lacroix 01/13/2012 04:40 PM
  12. Ellie McIntire 01/13/2012 10:22 PM
  13. Dana Smithers 01/18/2012 11:12 AM
  14. Dale Taylor 01/22/2012 12:15 AM
  15. Winston Heverly 08/26/2012 05:42 AM
Topic:
Home Selling
Location:
Ontario Ottawa Carleton
Groups:
Advice for Sellers
Canada, eh
House-Proud
Realtors®
BananaTude
Tags:
downsizing
baby boomer
zingers

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Rainmaker
170,660
Ellen Kippel
Weichert Realtors - Suffern, NY
Realtor Suffern Rockland County NY 914-588-2365

Your analysis is right on!  I am a realtor and a baby boomer and I keep thinking about selling my own house, but when I do, I realize that where I would go would be more expensive.  I have some parts of my home updated and other parts are flat out old, and worn looking.  I know what I need to do to make my home ready to sell, but then I say, maybe I'll just stay here, after all, and rattle around.  So - like many other baby boomers that will elect to stay in their homes, I may do this too.  Great article - right on target!  Thanks.

Jan 13, 2012 06:39 PM #170
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

This has been the most amazing post for the personal stories that many of you have added.  Thank you so much for all of the work that you put into the comments.  We all benefit from sharing our experiences.  While there are 175 comments, over 4,000 people have clicked here to read the post and the comments.   

 

Thank you.

Jan 14, 2012 10:13 AM #171
Rainer
197,941
Scott Seaton Jr. Bourbonnais Kankakee IL Home Inspector
SLS Home Inspections-Bradley Bourbonnais Kankakee Manteno - Bourbonnais, IL
The Home Inspector With a Heart!

This is the exact situation my wife and I will be in very soon. 2600 SF 4 br 3 bath full basement, big yard. Too much stuff and the kids don't seem to take it with them when they move out. Sometimes they even bring some more stuff back home for a while. Think we're staying for the long haul.

Jan 14, 2012 10:42 AM #172
Rainer
215,215
Akerly Real Estate Team Manhattan & Brooklyn Real Estate
Akerly Real Estate Team - Brooklyn, NY

Very interesting phenomenon.  It's also a story of what happens when people rely upon their primary residence as a means to capitalize their retirement dreams.  

Jan 14, 2012 11:29 AM #173
Rainmaker
1,017,701
Michael J. Perry
RE/MAX Associates of Lancaster, PA. - Lancaster, PA
Lancaster Relo Specialist

This post really should spawn another post about"the Life Cycle of a Neighborhood ". Many on these Boomer properties are in developments that have long lost their appeal or are seen as the place to be. And you are right to point out all of the Functional Obsolescence in these 1970-1990 built houses !

Jan 15, 2012 02:13 PM #174
Rainer
25,537
Bill Cullen
REMAX Absolute Realty Inc. - Ottawa, ON

I just wanted to add a note to my previous comment. Yesterday I was doing an Open House in the suburbs. A couple came through with their agent. Through the questions that I was able to ask I found out they had moved to a condo downtown a few years ago and just didn't adjust well to that lifestyle. I think this story may be repeated.

Jan 16, 2012 08:23 AM #175
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Bill:  I know it is being repeated.  The reality of living in a condo with neighbours on all sides and only two small bedrooms with limited storage is such a HUGE adjustment.  Yes, people do move back to bigger more private spaces, frequently.  

Jan 16, 2012 08:50 AM #176
Rainer
107,330
Ric Mills
Keller Williams Southern Az - Tucson, AZ
Integrity, Honesty, and Vast Real Estate Knowledge

Ouch, this is happening way too often. It happens the most to the people that have failed to keep their homes up to date and competitive in the market.  Big homes and big yards can be difficult to afford and keep up, but they may be the cheapest solution.  However, I am a Boomer, and made the decision to down size and move to an area and climate that I like. It is closer to family and is exactly what we needed. It wasn't all that we wanted, but it works and I have no lawn to care for and i don't have to shovel sunshine.

Jan 16, 2012 07:48 PM #177
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Ric.  You help make the point with your comment.  You traded off some things for others.  Compromise.  

Jan 17, 2012 06:34 AM #178
Rainmaker
93,313
Dana Smithers
PRES Staging Resource Centre - Vancouver, BC
PRES Staging Training, Redesign Training & Busines

Great post and oh so true Valerie! We home stagers come across this all the time. In fact it can happen that we will do such a fantastic job that once the prosepctive seller has gone out looking and finds out they can't afford that much - they decide to stay. Realtors aren't too happy with that but they do know it is a distinct possibility if the home seller has not been out shopping for a home for awhile.

Jan 18, 2012 11:11 AM #179
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Dana.  I have seen some unbelievable improvements with home staging.  Little wonder some people chose to stay. 

Jan 18, 2012 05:36 PM #180
Rainmaker
201,093
Samantha Smith
214.422.0729 www.SamIAmHouses.com - Rowlett, TX
Sam I Am, d+b Real Estate, Lake Ray Hubbard Realto

Sounds like you've been talking to my mom (tee hee!). 

Jan 18, 2012 10:53 PM #181
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Samantha:  The good and the bad thing about the Boomers is that there are so many of thme (me included) that it is a rare thing to be unique.  Your mom is in a good group.   LOL

Jan 19, 2012 11:26 AM #182
Ambassador
1,763,946
Barbara-Jo Roberts Berberi & Corinna Birgit Cromartie
Charles Rutenberg Realty - Palm Harbor, FL
Palm Harbor & Dunedin FL Residential Real Estate

Boomers that are downsizing now are not pleased with what they are getting but let's look at it from the side of those who purchased 20 years ago..........while they aren't getting what they would have 5 years ago, they are still making more then when they purchased and if they haven't taken all their equity out with a refi, they are good to go! AND many have been smart enough to upgrade their kitchens and bathrooms through the years! If they have done that, they are REALLY in good shape.

We have many families relocating from the north that want larger homes - so the demand here for 4 bedroom 3 bath homes is not a problem.

Jan 21, 2012 09:05 AM #183
Rainmaker
152,409
Dale Taylor
Re/Max All Properties New Lenox Illinois - Frankfort, IL
Realtor = Chicago Illinois Homes Townhomes Condos

I am a boomer not quite ready to downsize.  I don't have grandchildren yet.  My daughter, although a recent Nursing grad has just starter her career, and welcome to stay at home as long as she desires.  Plus, we still have all of the family come over to the large home for the holiday dinners.  This is a good reminder for those thinking of downsizing. 

Jan 22, 2012 12:09 AM #184
Rainmaker
864,171
Tim Lorenz
TIM LORENZ - Elite Home Sales Team - Mission Viejo, CA
949 874-2247

It is a sign of the times. The home will go up in value.

Jan 22, 2012 12:30 AM #185
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Barbara-Jo.  You make a good point but I have yet to see a client or friend who went back to what they paid for the home as the basis of the new value.  Too bad,  it should make some owners very happy about their ROI.

Jan 23, 2012 06:35 AM #186
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Dale.  Love your home and are still making good use of it?  I think you will be happy there for a long time.

 

Tim.  Tell clients that what goes down will come back.  Sadly, everyone wants to know when.

Jan 23, 2012 06:37 AM #187
Rainmaker
263,188
Tony Lewis
RE/MAX of Valencia (Hall of Fame) 30 year Valencia Resident - Valencia, CA
RE/MAX Valencia, Stevenson Ranch, Santa Clarita

Americans are now reflecitn Europeans and having generations of families live together.  Boomers are also looking for a one story home or 2 story with a master downstairs

Jan 26, 2012 03:08 AM #188
Rainmaker
575,417
Valerie Zinger
House Proud Ottawa-Ontario-Canada - Ottawa, ON
Home Organizer

Tony.  Just when hou think the nest is empty the kids come back and the parents move in.  

Jan 26, 2012 07:13 AM #189
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