Demographic timebomb and housing

[Salisburyspire]

When do we think babyboomers will begin to sell? This is not a generational bashing thread by the way, am asking from a strategic point of view.

Any economists or demographers out there? I have only seen one UK article on this and it predicted they wouldn’t sell until 2034 onwards. Surely that’s too late? Is there a particular five year period during which we expect there to be a huge downsizing?

When they do sell up, will it leave a glut of large homes on the market? I’m Gen X but very much want to trade up (one last large house). We own our house outright but the next step up in the area near DC schools has exponentially shot up over the last three years. (Leafy London but not too far out). One issue is a massive shortage of decent housing stock in that area. Our plan was always to move there, see the DC through school and then downsize as there doesn’t seem any point to living in a big house without the kids there when we could by then be enjoying a more comfortable retirement and liberating some property cash while not worrying as much about inheritance tax or costs of maintaining a large house and garden.

It seems though that the generation before is not budging. There are widowed people living in enormous five bedrooms homes with huge gardens. They don’t all look to be super wealthy judging by some of the slightly overgrown gardens etc. Yes it’s a wealthy area and yes it’s their right to live wherever they want. However unless all these homes are in a family trust or already signed over, the inheritance tax bill will be enormous.
These are homes in the £2million plus bracket.

If we are lucky enough to buy one of these homes (and stretch ourselves massively) do the demographics work against us if we have to sell in 10-15 years? Won’t that coincide with a glut of large houses so we will have bought at the top of the market and possibly be selling in a downturn?

Will Generation X actually be the riskiest generation to lend to as they don’t have enough working years ahead of them to properly pay down massive mortgages whilst some (not all!!) millennials will inherit property wealth from babyboomer parents?

Should the government reform stamp duty to provide an incentive to downsize? (Yes I know there are not enough quality smaller homes for people used to huge ones in nice areas). Will there ever be a great downsizing shift or is our country not built for it?

I have lots of people in their early 70’s living near me (so born around 1950). They are all in good health and their husbands/wife are still alive. Many have dogs and their sons/daughters bring their grandkids round. Also, they have been in their homes for 30/40 years so they have their house exactly how they like it.

Unless the stairs become problem there is no need to sell up. Also, where would they move to? There’s some retirement flats but not everyone wants to live a flat (and quite a few don’t have any parking). There are some bungalows round here but they are very sought after and sell for the same price as a house if not more!

@ThatsGoingToHurt
Bungalows take up a lot of land when compared to a house. Therefore they are expensive. When there are not many, they do tend to be sought after!

My DH isn’t far off 70. We’ve been here 35 years. Not going to move just yet. Mostly people from London buying near us and remodelling the houses. I like the space we have. I like entertaining, having different rooms for different functions and I enjoy my house, gardens, woods and fields. If someone made us a silly offer, we might go. Not into a flat though.

We could also live in our ground floor! We would need a bathroom instead of the cloakroom but we would easily reconfigure space into bedrooms. So here we stay.

We've just bought our upsize house from boomers in their 70s. This will absolutely be the biggest house we live in. DH is 49. I think it's a fairly common time to upsize with older primary kids. Are your kids in private? If so it opens up the area quite a bit.

My parents are 60 ish and my mum certainly would be up for a bungalow move from their 3 bed semi, but the ones that come on the market in this area are just as expensive as their current house, and usually in need of considerable modernisation. Some have been flipped by builders but end up looking a bit low budget, soulless and 'Homes Under The Hammer'esque. They don't have the appetite for major renovations, having been in their house for 25 years and finally have it just how they want it.

There would be no point in them even considering a move to a house with stairs, even thought they're both in great health. They've both had elderly parents with mobility problems

My father, on the very older end of the generation finally gave up his large home, only because he could no longer physically care for the grounds properly and was having trouble finding skilled labor in his remote location. If it had been in a desirable school area, he would have sold it to us for a good price. He had no desire for it to leave the family. We didn’t want it to either, but the location was never going to be possible for us.

I suspect many will be like him, hanging on as long as possible and when they do leave, preferring to sell to family.

Absolutely not. Also I don’t like the odd tone being taken here towards people who are over 60.

We don’t all need or desire bungalows. We don’t all want family to take over our houses. I want the £millions from mine! I have plans to have a good life.

I also hate the term “boomers”. As usual in this country we think it’s ok to label people and believe they all think the same. They don’t.

Baby boomers covers a large number of years though! I'm married to one of the younger baby boomers, we have a 6yo and we're in the middle of buying a bigger house! It's our 'forever' home so intended to last at least 20 years - that's see me to retirement, DH to 80s and DD to university. It has a ground floor wet room and downstairs space so we have purposefully bought to cover future eventualities.

I’ve not read the whole thread, but I think people are missing the point. Under occupancy, which a single person/couple living in a 4-5 bedroom house is, has far reaching impact on mobility within the housing infrastructure. All these 2-3 bedroom houses that people said they can’t find to downsize to - it’s because they’re occupied by those who need more space but can’t move up the ladder. And that also leads to a lack of smaller properties for FTB.

Someone up-thread mentioned their adult children struggle to afford to find and buy starter homes - well, can you really not see the link? If there’s minimal movement, up and down the ladder, it impacts everyone.

In amongst the prpoerty envy and inter generational hatred being expressed in some posts, the point has been made by sevearl posters that a major part of the issue is the lack of suitable smaller properties for people to downsize to. A lot of this is the failure of the planners to consider what is wanted in a home.

Politicians of all parties at national and local level have failed to account for the introduction of and benefits of the NHS. It has led to more people living heathlier lives for longer, but this was totally ignored. The increasing cost of the state pension was ignored for 70 years till the Coaltion Government had to address it in 2016 following the crash of 2008. The same can be said of housing; planners have failed to recognise that flats and "retirement homes" do not provide a suitable solution for a lot of people.

Bungalows are only space consuming in modern thinking; our bungalow stands on a smaller plot that the 3 bed semi house that we moved oiut of. We would have liked a larger garden but accomodating my partners disability was the overriding concern. We had to move 200 miles to find an affordable solution; the cost would have been double where we were due to lack of supply. This was partially caused by the local authorty allowing detached bungalows to be demolished to build small blocks of flats. It restricts the options for tyhose looking to downsize.

Rather than blaming the baby boomers (and yes I am one) for the current situation, blame the politicians since WW2 for lack of stategic planning.

That’s not entirely true. There are starter homes but not at low enough prices. More older folk wanting small homes won’t help. Just more people wanting smaller homes. There’s also a gap between a 3 bed semi and a large 4 bed detached. Lots of people cannot make up the difference, so they stay put and extend.

The bottom line is we don’t build enough houses. We don’t dictate what people do with their financial assets so if people use their houses as they wish, it’s their choice. Under utilised or not.

@TizerorFizz exactly! Everyone I know in their late 60’s/70’s is in good health and has worked hard over the years to have their house and garden exactly how they like it! Why would they want to move and start over again as long as they can afford the bills and are ok with the stairs (and even then they can get a stair lift)

@ThatsGoingToHurt
Yes. DH and me are late 60s. I fully accept we had a better income/price ratio when we bought our first house. We’ve only had 3 houses. This one is as we want it. So no need to move. Several in the village have sold up to downsize but 2 got in excess of £3million. All well over £1.5 million. So not sold to local families.

The system incentivises them to stay put. Financially, property is a better asset to hold and there's a shortage of suitable downsizing properties.

I agree it's crazy, my DP have two of them in a 5 bed while we have four in a two bed. It's inefficient in terms of bills, if nothing else.

Nothing will change until the numbers reduce enough that boomers are less of an electoral force. For now, everything is geared towards them.

[quote ThatsGoingToHurt]@TizerorFizz exactly! Everyone I know in their late 60’s/70’s is in good health and has worked hard over the years to have their house and garden exactly how they like it! Why would they want to move and start over again as long as they can afford the bills and are ok with the stairs (and even then they can get a stair lift)[/quote]
@thatsgoingtohurt I just don't buy this - all generations have some people who work hard and some who don't (not always through their own fault)

Why would they move? Because families with children are squeezing into tiny houses and they have a social conscience?

I think bbers are mad not downsizing, especially if they can't, very comfortably afford their bills.

@Kendodd

I think bbers are mad not downsizing, especially if they can't, very comfortably afford their bills.

Thing is they can. They’ve benefitted from the best pensions - final salary etc.

Well I will have swap with the DC if the location works for them which it should do because it’s fairly central but that’s been my plan all along the first one to have kids I’m gonna ask to buy a two bedroom terrace type thing to house swap with me and they can have the bigger one.

People say why should they move, yeah of course they are under no obligation to but personally I hate seeing small children cramped into in adequate accommodation whilst id be wasting money heating and paying council tax for facilities i don’t need.

@GrendelsGrandma
Social conscience never comes into moving houses does it? I’ve never heard that it has. Plus, as I said, it’s a big move in price from small house to a big one.

I hate to say it, but larger families just have to squeeze in if they cannot move. Number of children is a choice. Or move to another cheaper area where there is choice. They don’t want to do this but think others should. I don’t buy this either.

I tend to think all generations work, some harder than others. Some have way better salaries than others. They simply don’t need to move. When areas are desirable the only solution is to build more homes.

They’ve benefitted from the best pensions - final salary etc.

Some have. Many haven't, especially the women.

That’s exactly right. Lots of private companies that were quite small never had final salary pensions. DH is self employed so no final salary pension for him. His mum and my mum had no pensions at all. State employees such as nhs, teachers, civil service and local giver for and police all had great pensions but that’s not a majority.

Lots of the large corporate’s glaxo welcome just as an example, british gas, british telecom- large employer with women on a part time basis by the way - all had a lovely big final salary pensions and additionally the same generation would’ve benefited from enormous share payouts when these businesses privatised. One friend I remember who would fall into the Boomer category received enough to pay my mortgage off now in shares from the Halifax when it went from a building society to a bank. If they haven’t done well in life, honest to goodness you have to wonder why they had enough opportunities.

@Stevie77 makes a really interesting point here. Getting more fluidity in the market would benefit everyone.
I can’t move up a rung as it’s just so expensive. So my modest semi stays with me. Potentially I will extend it if funds allow (building costs are another thread) but all that does is take another house out of circulation from the smaller end of the market and I’d then likely not move again at all.

In answer to your question OP there’s no way of knowing really what will happen. So if you genuinely need to move and can afford to, then you just have to go for it.
I’d add that with my house the previous owners had owned it for several decades and although we had to do some works due to age (wiring etc) the other work was because what was there wasn’t to our taste. That’s not the same as having to do it or them letting the house go. My very elderly relative lives independently in their house and everything is serviced and looked after properly. But you can bet whoever ends up with that house would say it needs gutting. That’s purely down to different tastes.

I have worked predominantly with older people for the last 5 years across quite a large geographical area, so have had and continue continue have any cases where one/two people needing care are stuck in houses that are too big for then to manage, because there is nothing suitable for them to move to, adaptations can't be put in place to keep them there and they cannot afford better care because all their assets are in the bricks.

The biggest issue is lack of ground floor/ accessible accommodation, lack of sheltered /extra care housing, though if they are available there is no practical help for them to actually get the process moving- help with the applications, help to box up and move. So they stay where they are until there's a crisis (eg falling down the stairs) or they choose to move residential care before they actually would have needed to were they in a better suited property.

@De88
It all comes down to building.

One idea that should be thought about is linked housing. A larger house for a family linked to a smaller bungalow for the parents. We never see multi generational developments. We don’t want a flat when we are older. We might want a bungalow but we are fairly well off. Finding one in a town that’s big enough will be an issue though.

Lots of people on this thread seem to think people in their 60s are old and should move. The only people I know of that age who have downsized have done so to free up cash for DC for their homes.

As for pensions: yes, big wealthy employers might at one time have had final salary but that’s a long time ago now. Not everyone winked for these companies. White collar pensions were more generous. Shop floor workers didn’t have it so good. That’s millions of people. Plenty also lived hand to mouth. Plenty didn’t have great opportunities either. Remember steel plants, coal mines, ship yards, docks and heavy industry all closing down? The pensions went with them.

Thing is they can. They’ve benefitted from the best pensions - final salary etc

Wild generalisations about entire generations, such nonsense.

So many women born in the 40s and 50s all working in well paid jobs with fantastic final salary schemes. Surely you don't really believe that? Many women were forced/expected to give up work as soon as they married. And those that did returrn to work were paid way less than men in identical roles. And there were very few private pension schemes. You might also want to read up on the reduced state pension many of these women were or are entitled to, because of lack of NI contributions.