As the U.S. faces a shortage of available homes, some may be looking to occupied homes owned by "empty nesters" to fill the gap. However, those homes aren’t likely to be the solution.
The Problem with Empty Nesters
According to Orphe Divounguy, a senior economist at Zillow, empty nesters – those aged 55 or older with no children at home and at least two extra bedrooms – don’t live in the same areas where younger generations want to be. They are concentrated in more affordable markets, where housing is already accessible, not in the expensive coastal job centers where young workers are moving.
The Reality Check
A report by Zillow finds that around 20.9 million households fit the definition of empty nesters in 2022, with the greatest concentrations in Pittsburgh, Pennsylvania; Buffalo, New York; and Cleveland, Ohio. However, the cities with the most people under 44 are San Jose, California; Austin, Texas; and Denver, Colorado. "Unless we see more businesses and workers relocating to the Midwest, the big flow of housing coming is probably not going to do much to help those markets," Divounguy says.
What Won’t Move the Needle
The homes empty nesters are vacating might not be the same properties young people are looking for, especially if they are large or relatively expensive for the area.
New Construction Faces Roadblocks
So, what will actually move the needle? Divounguy says that new construction in the cities facing the largest shortages is the only viable solution for improving housing affordability. However, there are numerous roadblocks preventing construction from keeping up with demand, including:
- Rising costs of building materials
- Lot size requirements
- Density restrictions
- Project reviews that can take up to 24 months
Solutions
To overcome these roadblocks, lowering costs for builders and changing zoning laws will be key. Streamlining building permit approvals may also help push things in the right direction.
Conclusion
The current shortage of available homes is not likely to be solved by the homes vacated by empty nesters. New construction in the cities facing the largest shortages is the only viable solution for improving housing affordability, but numerous roadblocks are preventing construction from keeping up with demand.
FAQs
Q: Why are empty nesters not the solution to the housing shortage?
A: Empty nesters live in more affordable markets, not in the expensive coastal job centers where young workers are moving, and the homes they are vacating might not be suitable for younger generations.
Q: What is the only viable solution for improving housing affordability?
A: New construction in the cities facing the largest shortages is the only viable solution for improving housing affordability.
Q: What are some roadblocks preventing new construction from keeping up with demand?
A: Some roadblocks include rising costs of building materials, lot size requirements, density restrictions, and project reviews that can take up to 24 months.
Q: What can be done to overcome these roadblocks?
A: Lowering costs for builders and changing zoning laws can help overcome these roadblocks, and streamlining building permit approvals may also help.
