Sunday, September 28, 2008

Who Will Buy the Boomers' Houses?

During the debate at the University of Mississippi last Thursday, John McCain said, "This isn't the beginning of the end of financial crisis, this is the end of the beginning." The comment itself didn't spark controversy, and the candidates moved on to other topics, but it resonated with me.

I see another perfect storm brewing in a few years. At some point, the baby boomers will begin attempting to sell their houses -- whether because of infirmity, the desire to simplify or the need for cash. Whatever the reason, a fair number of four bedroom colonials will hit the market.

At the same time, college tuitions are spiraling out of control, with more students graduating with large amounts of student debt. When they marry, they'll combine two student loan portfolios. For many of them, the level of debt they've assumed will preclude a house purchase.

So who will buy all the baby boomers' houses?

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