By Rebecca Wissink
When society and culture shift, often slowly but sometimes rapidly when reacting to a global pandemic, these changes impact every area of life, including housing. Almost two years into the COVID-19 pandemic the real estate and housing market has undergone radical changes. Prices soared in some markets, people moved to places that traditionally see little growth in population, and a new trend emerged - Baby Boomers choosing to age-in-place. Rather than downsizing into a condo or moving into a group living situation, Baby Boomers are refusing to give up their larger homes. However, this is actually a continuation and variation of a pre-pandemic trend that was already being documented back in 2018. Pre-pandemic, millennials who could not afford to purchase homes were either moving back into the natal fold, or never leaving, so Baby Boomers were renovating their homes in droves to accommodate these increasingly common inter-generational households, particularly in the expensive markets of Vancouver and Toronto.
Further solidifying the trend of aging-in-place, a 2021 real estate report by Engel and Volkers suggests the disgrace and tragedy that was the assisted living landscape has made our seniors wary and now Baby Boomers are not willing to move into retirement communities or nursing homes. With the bad press the Long-Term Care Homes and retirement facilities received during the first year of the COVID-19 pandemic, can you blame these folks for wanting to avoid those facilities? Recent Statistics Canada data indicates that in 2020, those 65 years and older accounted for 94 % of all COVID-19 deaths. However, it was not just watching their parents, relatives, or friends become isolated in these facilities that is impacting this generations desire to age-in-place. The pandemic’s restrictions and lock-downs reportedly also made Baby Boomers value their homes and the larger spaces these properties provided.
A 2021 study by Royal LePage found that 52% of Baby Boomers would prefer to renovate their home rather than move. Baby Boomers want to age-in-place, so many are renovating their properties to meet their upcoming age-related needs such as ground-floor bathrooms and step-free access to the home. And they can afford to do so. Baby Boomers can utilize the built-up equity in their homes to renovate, and when the time comes, hire private care to elongate their time at home. With 75% of this cohort owning their own homes, this is a new reality that will potentially impact the real estate market for decades. Reverse mortgages are another means available to Baby Boomers that will allow them to age-in-place. One Canadian bank that provides reverse mortgages recently stated that they now hold more than $5 billion worth of reverse mortgages.According to NPR, at the end of July 2021, Baby boomers (born between 1946-1964) in the United States held the largest share of real estate wealth – 44% - even though they only represent 28% of the population. Here in Canada this cohort represents more than 20% of Canada’s population.
Baby boomers will live in retirement longer than any prior generation due to improving health care and lifestyle awareness. If you’re a Baby Boomer who wants to age-in-place and stay in your established community, but don’t think your home is quite right for what the next few decades will bring, speak to an experienced Ross Pavl ELITE Real Estate Group Realtor® today rather than going through the pains of an expensive and time-consuming renovation.
Image via creative commons courtesy of Great Valley Center
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