A new study by two USC researchers, Dowell Myers, a
professor of urban planning and demography in USC's
School of
Policy,
Planning and Development, and Sungho Ryu, a doctoral candidate at the school
and an associate planner with the Southern California Assn. of Governments has
interesting implications for the future housing market.
Their thesis essentially is that as the nation ages the
owners of property sell to use their equity. Historically, there is evidence
that seniors sell between 55 and 75. The first boomers will be reaching this
apex at or around 2011. Correctly, the thinking is that this added supply for a
decade or more will seriously increase market supply and most especially in the
retirement states such as
Florida and
Arizona. This should
happen just as many economists are predicting the markets will have recovered.
According to the researchers, via the LA Times article:
".. the rates of buying and selling remain closely
related because those who sell one house typically buy another. When people
enter their late 50s and early 60s, as the leading wave of baby boomers has now
done, buying and selling are in balance. When they reach their mid-60s, though,
sellers start to outnumber buyers. And when they hit their 70s, sellers
dominate."
Who Wins:
Very interesting stuff and certainly logical. If this plays
out as they expect then I would think that the winners would be
1. The American Dream: People now out priced by homes
a. Young people
b. People
starting over
c. The newly
arrived with less asset
2. Builders and retirement communities in less expensive
parts of the world such as
Panama
might see rising equity
