The National Association of Realtors issued the most recent edition of its exhaustive Home Buyer and Seller Generational Trends Report this week, providing an interesting snapshot of homebuying habits within the 62-and-older set.
The Washington, D.C.-based trade group probed trends among homebuyers of all generations, starting with 36 and younger and going all the way to those aged 71 to 91. The NAR measured everything from prior housing arrangements to income to marital status within each age cohort. Among those who would qualify for Home Equity Conversion Mortgages, some understandable trends emerged: A desire to live near friends and family was a major driver of home purchases for older baby boomers aged 62 to 70, with a full 19% citing that as a primary reason; that number rises to 23% for those between 71 and 91, the so-called “silent generation.”
Older boomers also expected to stay put after buying a home: 27% of buyers aged 62 to 70 said they planned to remain in the home for 16 or more years, a percentage that’s only slightly lower than those reported by their younger counterparts. Large swaths of respondents in these demographics also cited a household member’s health issues as a reason that they could eventually leave their homes: 25% for 62-to-70-year-olds, and 36% for the silent generation.
Curiously, student debt — a financial constraint most commonly associated with the millennial generation — remains a problem for those who are approaching HECM eligibility. A full 12% of homebuyers aged 52 to 61 still had student loan debt, with 34% of those carrying $10,000 to $24,999, and 22% with $50,000 or more. NAR speculated that these figures include their children’s educational tabs as well as younger boomers’ own school bills.
The NAR also investigated the types of mortgages used by buyers who financed their home purchases. In the 62 and older categories, the HECM for Purchase product was not prevalent enough to register as its own measured option, with a 2% “other” figure in both the 62-70 and 71-91 groups; 89% of the former cohort and 83% of the latter used a regular fixed-rate mortgage to fund their transactions. By comparison, use of fixed-rate mortgages hovered in the low 90% range for all other demographic sets.
Read the full report here — it’s chock full of interesting data and worth a deeper dive into the myriad charts and graphs.
Written by Alex Spanko