Will a Silver Tsunami Affect the 2024 Housing Market?
Have you ever heard the term "Silver Tsunami" and wondered what it means? If this is the case, it could be due to a recent surge in online discussion. Let us look at what it is and why it is unlikely to have a significant impact on the housing market.
What Does Silver Tsunami Mean?
A recent article from HousingWire calls it:
“. . . a colloquialism referring to aging Americans changing their housing arrangements to accommodate aging . . .”
As baby boomers age, many are expected to downsize their homes. Given the size of that generation, if these changes occurred in a large wave, they would have a significant impact on the housing market by increasing the number of larger homes for sale. The influx of new homes on the market would have an impact on supply and demand, as well as other factors.
The concept makes sense in theory, but will it happen? And if so, when?
Why It Won’t Have a Huge Impact on the Housing Market in 2024
Experts say, so far, a silver tsunami hasn’t happened, and it probably won't anytime soon. According to that same article from HousingWire:
“. . . the silver tsunami’s transformative potential for the U.S. housing market has not yet materialized in any meaningful way, and few expect it to anytime soon.”
Here’s just one reason why. Many baby boomers don’t want to move. Data from the AARP shows over half of the surveyed adults ages 65 and up plan to stay put and age in place in their current home rather than move (see chart below):
Clearly, not every baby boomer is planning to sell or move, and even those who do won’t do it all at once. Instead, it will be more gradual, happening slowly over time. As Mark Fleming, Chief Economist at First American, says:
“Demographics are never a tsunami. The baby boomer generation is almost two decades of births. That means they're going to take about two decades to work their way through.”
If you are concerned about a Silver Tsunami shaking up the housing market, do not be. The impact of baby boomers moving will be gradual over many years. Fleming sums it up best:
“Demographic trends, they don't tsunami. They trickle.”