An annual study of the housing market performed by Harvard University anticipates a strong recovery to come, brought about by a surge in housing demand from the 75 million people known as Generation X, or the “echo boomers,” who were born between 1979 and 1995 . With numbers approaching those of their baby-boomer parents, this broad demographic is just beginning to accumulate the money and independence necessary to become the wave of first-time homebuyers who will create a new market for homes across the United States throughout the 2010s. Renewed regulations on lending and the intensity of the U.S. financial crisis will slow arrival of the eventual recovery which is expected to be gradual; nothing like the boom years of the mid-2000s, or even the milder boomer-driven market of the later ’80s.
first tuesday take: The population between the ages of 25 and 34 makes up, by far, the bulk of first-time homebuyers. This demographic’s number last peaked in 1992, as about 570,000 baby boomers came of age in California, and is set to peak again in 2017, with a population of approximately 550,000. If historical trends hold true, approximately 100,000 new single family residences will need to be constructed to accommodate the Generation X-ers, and countless more now-vacant properties and boomers’ resales on retirement will find their permanent owners in Generation X’s slow but inevitable new wave of homeownership. For a detailed look at demographic trends in housing over the past 29 years with first tuesday’s projections onward to 2020, see our recent report on first time homebuyers and new housing.
Re: “Housing saviors: The echo boomers”, from CNNMoney.com