[spaceflunky]

>Unless the housing supply increases this will just be a temporary thing.

The housing supply will increase dramatically in the next decade, not by building but by attrition.

More than 55% of all homes in America are owned by Silent Gens or Boomers[0]. That figure includes non-SFHs, of SFHs I've read they own >70% of (lost my source unfortunately). They are going to start dying of en masse within the next decade. That means A LOT of SFH are going to hit the market, all around the same time.

The share of millenials and genzers who are financially fit to even purchase a home are going to be far less than the amount of people who are dying.

For the non-believers, it's all written in the demographics. Unless we import a shit load of migrants who can also afford expensive real estate, or we print money so that institutions can buy these properties, the prices are going to sink like crazy.

[0]https://ipropertymanagement.com/research/homeownership-rate-...

[jeffreyrogers]

Well their kids could live in them, or sell it and buy a different house to live in. Forecasting what the effect of that supply will be on prices seems hard to me. Housing units per capita is lower than it was 20 years ago[0] and I think if you could find a longer time series you would see the pattern continue back many decades. That timeseries also includes all housing, not just SFH. I think if you just looked at SFH the decline would be more dramatic.

[0]: https://fred.stlouisfed.org/graph/?g=j9kH

[spaceflunky]

>Well their kids could live in them

Unlikely. There's a very high likelihood the house will have to be sold, either to pay off debts of the deceased (or bereaved), or because the children already have their own lives going, or because they don't want to assume the tax burden, or simply because each child wants their share to do with as they please.

>or sell it and buy a different house to live

This is what's going to happen. All of these property will be sold. A very small percentage will be assumed by the children because of the all issues mentioned above.

[jjav]

> The share of millenials and genzers who are financially fit to even purchase a home are going to be far less than the amount of people who are dying.

I don't understand this sentence.

The number of houses that get sold or transferred to living people is of course exactly the same as the number of houses vacated by people who died. It can't be anything else since houses don't evaporate when the owner dies.

[pixl97]

Just because you die doesn't mean your house is paid off or you don't have some kind of reverse mortgage on it.

Just the yearly taxes on my home would be a significant burden to many.

[jjav]

> Just because you die doesn't mean your house is paid off or you don't have some kind of reverse mortgage on it.

That doesn't change anything with respect to the existence of the house. Someone might take a loss (the heir or a bank) but no matter, the house continues to exist and someone else will end up owning it.

> Just the yearly taxes on my home would be a significant burden to many.

If nobody can afford it that just means the price (and thus tax) will drop until someone can.

[exclusiv]

I'm a non-believer. Counter arguments:

1) Not 55% from your article. Youngest boomer is 59. That's about middle of the 55-64. So split the difference, it's 43.8%. Millenials are larger than boomers. Gen X is larger than Silent generation. If your thesis of them not being able to buy when they die off is correct, well, see #2 and #4 below.

2) People that inherit don't have to sell. Many will simply rent as it could be tax advantageous. Or they move in.

3) Construction costs (labor, materials) will inflate minimizing new supply.

4) The Fed has no choice but to bring rates back down and keep printing. National debt is $33T which is crazy but unfunded liabilities are 211T! We're well on our way to paying 1T in annual interest. 65% of spending is mandatory. Debt historically % of GDP is 46.9%. End of 2022 - 97%. [1]. Interest rates cannot remain historically elevated and the only way out of the debt load is to print print print. This helps assets and affordability (debt service) for investors and the genx, millenials to acquire. The US and world got drunk off a cheap dollar.

So I disagree on the macro of your thesis. Certainly some areas will be affected though with boomer/silent passings but that will be due to a demographic change in demand, gen x and younger not desiring those areas for numerous reasons.

I'll be holding assets as inflation continues, and probably rips again in the near future. It will be traditional inflation (actual economy) or inflation in the financial economy (stocks, assets). One or both have to rip from inflation. There's no way out of the debt load.

[1] https://www.cbo.gov/publication/58888

[klipklop]

> Unless we import a shit load of migrants who can also afford expensive real estate, or we print money so that institutions can buy these properties, the prices are going to sink like crazy.

Likely the powers that be will print money to hand over to institutions to gobble up real estate who will then rent out the properties to the incoming mass migration wave into the US. Most of these new arrivals have a almost zero percent chance of becoming home owners with the current pricing and wage suppression going on.

It seems to me various real estate investment groups have essentially unlimited lines of credit to buy up properties. On the commercial side they seemingly can ride out many of their units being empty for YEARS.

[rufus_foreman]

>> They are going to start dying of en masse within the next decade. That means A LOT of SFH are going to hit the market, all around the same time.

80% of the silent generation is already dead along with 33% of the baby boomers. Between them, around 8,000 people die every day, and that has been going on for quite a while.

When do you expect this to start having an effect on prices?