Planning In The News: Will Utah home prices drop as a result of the ‘silver tsunami’?

April 12, 2024 by Evan Curtis
Housing

Planning in the news: Will Utah home prices drop as a result of the ‘silver tsunami’?

Article: Link

By Judd Bagley, in Utah Business

It’s been said that “demographics is destiny.” From a housing perspective, economist and demographer Dejan Eskic—a senior research fellow specializing in housing at the Kem C. Gardner Policy Institute—says the destiny of the housing market throughout the 2020s has been driven by the arrival of millennials.

“The next decade will be all about retiring seniors and where they will go,” he continues.

Eskic is referring to an idea posited by housing industry observers in recent years: the coming wave of downsizing baby boomers will free up enough housing inventory in short order to make home prices more affordable for those approaching the average first-time homebuying age of 33—at a time when surging home prices in Utah have never been less affordable.

As with so many issues confronting boomers and their grandchildren’s generations, the topic is a polarizing one, though many experts tend to agree that this downsizing “silver tsunami”—as it’s come to be called—may be significant in some geographies.

Utah will not be one of them.

The first serious bit of research into the market impact of boomer aging was published by Zillow in 2019. It ranked the 58 largest metropolitan areas in the United States by the degree to which senior downsizing would impact their housing markets over the subsequent 18 years, the time by which most of the boomer generation will have reached retirement age. The study based its estimates on U.S. Census data and lifespan actuarial tables to project what portion of boomer homes will be put up for sale during the analysis period, either due to the occupants downsizing or dying.

The resulting ranking saw common retirement destinations like Tampa, Tucson and Miami at the top—in the mid-30 percent range—and Metro Salt Lake dead last, at about 19 percent. A visualization of the data reveals the kind of orderly distribution one expects when quantifying complex, natural systems—until you reach the bottom, where the data seem to fall off a very unnatural cliff.

Read the rest of the article here.