Baby Boomers in metro Denver and Colorado Springs are in a strong position to sell their homes and downsize to smaller quarters, thanks to high rates of ownership and robust rates of price appreciation.
“Downsizing depends on a lot more than just the ability (and equity) to do so. Seniors may not want to give up on the neighborhood and lifestyle they’ve grown accustomed to in their longtime home. So in expensive markets, tight inventory and sky-high prices make downsizing locally a hard task,” said Alexandra Lee, a housing data analyst with Trulia.
Trulia defines the ability to downsize as a senior household, over age 65, that owns a home and has no younger generations living with them. Those households on average have two extra bedrooms, compared to just one extra for households under age 65.
Nearly six in 10 senior households in Denver meet that “downsizeable” definition. In Colorado Springs, it is closer to 65 percent, placing it in the top three metros along with Knoxville, Tenn., and Dayton, Ohio.
But being able to move and actually moving are two different things. Lee notes that Baby Boomers are working longer and are more likely to have children and grandchildren living with them than in the past.
In 2006, 15.9 percent of those 65 or older were in the labor force nationwide. Now it is closer to 19 percent. And 16.1 percent of those senior households are hosting children or grandchildren, which requires more space. That is up from 14.4 percent in 2005.
Both circumstances complicate a downsizing.
In 2005, more than half of senior households were in a multifamily dwelling by age 75. That midway point is now age 80. Young adults, by contrast, are living in apartments or with friends and family at a much higher rate than prior generations.
Nationally, about 5.5 percent of households headed by someone over age 65 moves in a given year, a pace that hasn’t changed. About half of those move into apartments, and half into single-family homes, usually smaller ones.
In the country’s most expensive markets, like San Francisco, the study found that older households are more likely to rent or have younger generations struggling financially to make it living with them.