Millions of American homes could become unsellable, or could be sold at significant losses to their older adult owners, between now and 2040, according to new research from the University of Arizona.
The study, led by Arthur Nelson, Ph.D., a professor of urban planning and real estate development at the University of Arizona, synthesizes data from sources such as the U.S. Census Bureau and the Harvard Joint Center for Housing Studies.
Nelson used the data to map how the ages of homeowners would change between 2018 and 2038. His results predict that the changing home-buying behaviors of younger generations may result in a glut of homes that could grow as high as 15 million by 2040, with homeowners selling for far below what they paid, if they can sell them at all, Nelson said. Although most seniors eventually will be able to sell their homes, the study said, it may become especially difficult in smaller, distant and slow- or non-growing markets.
“There’s a mismatch: if those over 65 unload their homes, and those under 65 aren’t buying them, what happens to those homes?” Nelson said.
If his predictions play out, he added, it could undermine one of the biggest promises of homeownership for millions of seniors: that a home, after it’s paid off, can be sold for a retirement nest egg.
“What if you pay off your mortgage over 30 years,” he added, “and nobody buys the home?”
Nelson’s paper was published this week in the Journal of Comparative Urban Land and Policy.
