America’s housing market is finally starting to pick up some momentum to provide a little growth for the nation’s economy, and the aging population stands to have a profound impact on the future of this recovery, according to The State of The Nation’s Housing report 2016, by the Joint Center for Housing Studies at Harvard University.
Some areas that will continue to drive the housing market are high rental demands, housing sales and prices, the rise of new construction of single-family homes and the aging adult population.
In the adult aging population, and more specifically, in the retirement-aged population, the number of households with residents age 70 and older is predicted to increase by over 8 million, or 40%.
“The increases will lift the share of older households from 16% in 2015 to about 21% in 2025,” the report said.
There are many ways the increase in older households will impact the housing demand, one being, a further decline in residential mobility and housing turnover because many older people now wish to age in place.
The demand for remodeling and other types of accessibility improvement projects will also increase as older Americans stay in their homes as they age. There is also the prediction of an increase in older adults living alone in the coming years, which will increase the need for in-home health care and other supportive services.
The report took an in-depth look at performance and trends in the U.S housing market. Even though things are looking up compared to the years immediately following the crash, there are still challenges in affordability among homeowners and renters.
“Tight mortgage credit, the decade-long falloff in incomes that is only now ending, and a limited supply of homes for sale area ll keeping households—especially first-time homebuyers—on the sidelines,” said Chris Herbert, managing director of Harvard’s Joint Center for Housing Studies. “And even though a rebound in home prices has helped to reduce the number of underwater owners, the large backlog of foreclosures is still a serious drag on homeownership.”
Find the full report here.
Written by Alana Stramowski