Q: The Census Bureau reports baby boomers and seniors in general are the up-and-coming buyers in the next few years. Is this correct? — Chuck B., Las Vegas
A: I agree that baby boomers will have a big influence on the housing market, especially here in Southern Nevada. Your question hits home with me for a variety of reasons. First, I am a baby boomer. As a longtime local Realtor, I find that a sizable percentage of my clients are also baby boomers and senior citizens.
Much has been written over the years about the size and influence of the estimated 78 million Americans born between 1945 and 1964, when birth rates and the economy boomed following World War II. Studies have shown that boomers account for more than 80 percent of personal financial assets in the U.S. and more than half of all consumer and discretionary spending.
As for how boomers are influencing the housing market, I know demographers and other experts have commented and debated about it. I’ve seen some national news reports in recent years that predict boomers may hamper home sales and prices nationwide as they retire and downsize.
The first thing that comes to mind is the fact that the first major wave of boomers will be turning 60 to 65 this year. Economic conditions permitting, this may mark the beginning of a boomer-led retirement wave, one that could benefit Southern Nevada.
I attended a presentation on this issue and related topics by Ken LoBene, who directs the Las Vegas office for the U.S. Department of Housing and Urban Development. LoBene documented the potential impact the first wave of boomers could have on the local housing market as they begin to retire.
He pointed out that Southern Nevada has always been heavily influenced by our neighbors in Southern California, which he said is home to an estimated 2.5 million people past or reaching the traditional retirement age of 62. If 10 percent of those, or 250,000 Southern Californians, decide to move out of state, and only 10 percent of those movers relocate to Southern Nevada, he said that could equate to 25,000 retirees potentially moving into our state.
Whether they come from California, the East Coast or wherever, LoBene said Southern Nevada is well-positioned to benefit from baby boomers.
“They’re more likely to sell in those areas where they currently live,” he said. “They’re more likely to buy in areas like Las Vegas.”
I already see the oldest baby boomers beginning to buy investment properties and future retirement homes here and in the warmer climates in the South and Southwest U.S.
Some experts have predicted that continued growth in the Southern and Sun Belt states could eventually lead to these states accounting for more than 40 percent of the country’s population.
In addition to our warm weather and famous entertainment offerings, Las Vegas is also attractive for current and future retirees due to our undervalued housing prices, our generally low cost of living and year-round recreational options. In my experience, typical baby boomer clients are active retirees who enjoy such amenities.
Another attraction for this group is our improving health care facilities, such as the Lou Ruvo Center for Brain Health and its affiliation with the Cleveland Clinic. I’m also excited about the Veteran’s Administration hospital being built in North Las Vegas. I see this as a major draw for former members of the military moving here.
Time will tell. I agree with LoBene about the chances of these trends favoring Las Vegas over time.
Paul Bell is the president of the Greater Las Vegas Association of Realtors and has worked in the real estate industry for 30 years. GLVAR has 12,500 members. To ask him a question, e-mail him at email@example.com. For more information, visit lasvegasrealtor.com. Questions may be edited for space and clarity.