Baby Boomers represent the largest share of homebuyers this year, a spot Millennials have held since 2014, according to the National Association of Realtors. Rising interest rates and stubbornly high asking prices have eroded the buying power of Millennials, especially when paired with student loans, stagnant wage growth, and an economy bogged down by rampant inflation.
On the other hand, Boomers making home purchases are, in many cases, backed by significant equity wealth. As that demographic downsizes, they’re frequently competing with entry-level buyers for a minuscule share of starter homes, and as the wealthier generation, Baby Boomers are coming out on top, The Washington Post reports.
“Boomers are absolutely in the driver’s seat,” said Jessica Lautz, deputy chief economist at the association, because they have built up home equity and can pay in cash. “Unfortunately, that has pushed many millennials to the sidelines.”
The “homeowner” group tends to include people who are productive in the labor market, have properly saved for a down payment or have “built a ton of wealth” as they near retirement, [Joseph] Gyourko said — as opposed to a young renter who may not have achieved those benchmarks.