Study: Aging Boomers and Young Immigrants to Domin
Washington, DC, November 28, 2006--The most significant factors impacting housing over the coming years are whether aging baby boomers decide to grow old where they are and where young immigrants decide to settle, according to a new study released today by the Mortgage Bankers Association.
The study, “America’s Regional Demographics in the ‘00s Decade: The Role of Seniors, Boomers and New Minorities,” conducted by William H. Frey of the Brookings Institution and sponsored by the MBA’s Research Institute for Housing America (RIHA), analyzes two components driving the changes that will transform the U.S. population over the next several decades — aging boomers, and immigration of Hispanics and Asians.
It finds that the overall U.S. population will experience a rapid aging as boomers grow older, while absorbing large numbers of young recent immigrants. Different regions of the country will have different demands for housing driven by the relative impacts of aging in place versus migration within the country and immigration from abroad. For example, suburban areas will gray faster than urban areas due to the boomers aging in place.
“It has been said that demographics are the future that has already happened and demographic changes are one of the most powerful forces impacting the residential and commercial real estate and real estate finance markets. Therefore the real estate industry needs to appreciate these important trends. This study provides insightful analyses of current statistics and valuable projections regarding how these trends will likely play out nationally and regionally in the years ahead,” said Doug Duncan, MBA’s chief economist and senior vice president of research and business development. “We expect that this study will help our members develop business plans to meet the ever changing American marketplace.”
Key findings from the study include:
• Senior populations can increase through in-migration or through aging in place. However, aging in place is the dominant force that will shape demographic changes in the years ahead.
• Even in Arizona, which shows the highest rates of net in-migration, the migration effect is dwarfed by the effect of the existing population simply getting older and not moving.
• The most dramatic impact of aging in place will be in parts of the country which are not now associated with aging populations, like Nevada, Colorado, or Georgia. These states that will exhibit the fastest senior growth are not necessarily the ones that have the highest percentage of seniors. States with high senior shares have typically experienced one or more decades of sustained declines in their younger populations. This leaves behind seniors who are far less likely to move than people in their 20s and 30s.
• Suburbs will be the fastest graying part of our national landscape. In projections of Philadelphia and Chicago, for example, suburbs will begin to age faster than cities, even though both cities start out having older populations than their suburbs.
• While close to 30 percent of young households move each year to a new residence that percentage slides down to the 4–5 percent range for people in older age groups. Therefore, household mobility that has been a major driver of home sales will fall off as boomers age.
• Less than 2 percent of residents aged 55–64 move across state lines in any one year and the percentage is even less for those over 65. The aggregate number of interstate moves among those aged 55 and over is dwarfed by the number of moves undertaken by the younger population, meaning fewer moves as a larger portion of the population is over 55.
• Well-off young senior populations will emerge in areas like Las Vegas, NV, Denver, CO, Dallas, TX and Atlanta, GA.
