As we come to the end of summer and the end of the busy season for the Real Estate world, let’s look at what Scottsdale Arizona’s Multiple Listing Service (ARMLS) had to say about our market when looking back at the month of June.
“The loud explosions heard earlier this month were not coming from Independence Day celebrations. They were the 2019 year-to-date housing numbers being reported by ARMLS. The first half of 2019 began with a whimper and ended with a bang. May and June were both exceptionally strong with June having $3,265,463,755 in dollar volume, the highest total for any June in ARMLS history. As an added caveat, there was one less business day this year compared to 2018, making this year’s total that much more impressive. As we reach the halfway point for the year, 2019 ranks as the best year on record.” – Tom Ruff with ARMLS.
One of the biggest points mentioned on the services monthly breakdown of June was baby boomers vs. new home buyers:
“In a June 8 report, Freddie Mac asked the question, ‘Are Baby Boomers the Key to the Single-Family Market?’ The article states, ‘One of the most important keys to today’s single-family housing market is homeowners who were born before the first-ever episode of Star Trek aired in the 1960s. Today, more than 50 years later, Baby Boomers and other homeowners over the age of 55 control almost two-thirds of the nation’s home equity – about $8 trillion. There are also more than 67 million 55+ homeowners. Whether they decide to move from their current homes or age in place, the cumulative impact of their decisions on mortgage demand, affordable housing supplies, and the housing options available to Millennials and other aspiring homeowners will be substantial.
“63 percent of 55+ers prefer to age in place. This works out to an estimated 42 million homeowners who don’t plan to move. 27 million 55+ers would prefer to move at least one more time. Although movers are in the minority, it’s a big minority. According to the survey nearly 40 percent of all homeowners 55+ would like to move at least once more if they had complete control over it. This isn’t just about downsizing to a rental or nursing home; 19 million plan to buy a home and nearly 8 million expect to move within the next four years. What’s more, half of the 19 million likely movers expect to buy less expensive homes. These are big numbers with the potential to tighten home-buying competition in the housing market, especially for Millennials and other first-time home buyers.
“A recent Chicago Tribune article went on to say, ‘The boomers are a stick in the spokes of the homeownership cycle, which counts on older people exiting to free up houses that can be resold to first-time buyers, keeping the market moving’.”
Only time will tell how much our baby boomers will control the housing market, causing both prices and new listings to either rise, or decline.