Baby boomers own the largest share of U.S. homes among any generation.
Despite accounting for one-fifth of the total U.S. population, those born between 1946 and 1964 owned more than one-third of all residential homes in 2022, per Freddie Mac data.
And yet, 12 million baby boomers — or just below one-fifth of that generation — are renters, aging unencumbered by a monthly mortgage payment.
“They want to be able to call someone if the pipes burst or if the air conditioning goes out,” commented Matt Schulz, chief consumer finance analyst at LendingTree, in a recent report examining the trend. “They don’t want to mess with mowing the lawn and pulling weeds.”
Some evidently do, given the generation’s nearly 78% homeownership rate. But others may find themselves seeking the cost savings of renting versus owning.
“Just a downpayment can be outrageous,” said Schulz. “For those boomers who want to live in a big city, especially a big coastal city, renting may be the only reasonable option.”
Still, the boomer rental rate has declined in recent years, falling from 20.5% in 2018 to 18.6% in 2023.
A survey conducted a year ago by market analytics firm Clever Real Estate found that more than half of all baby boomers said they never plan to sell their home and “expect to live in it for the rest of their lives.”
Aging-in-place trends that have slowed housing turnover are facilitated by medical and technological advancements enabling aging homeowners to live independently longer.
However, baby boomers who may want to purchase are driven by the market to rent in high-home-price markets like the New York City area and California, where boomer rental rates are highest.
California has a particularly high concentration of boomer renters, with 10 of the top 23 metros tracked. Nearly one-third of baby boomers living in Los Angeles rent, roughly equal to New York, while just over one-quarter of baby boomers in Las Vegas are renters.
“Even boomers who’ve fully paid off mortgages may find financial benefits to renting if it allows them to avoid high property taxes,” the report indicates, citing nation-high property taxes in New York City, San Francisco and San Diego — all top boomer rental markets.
The downward trend in boomer rental rates may reverse in coming years, Schulz predicted, if elevated cost-of-living expenses fail to meaningfully subside.
“The convenience of renting combined with stubborn inflation, high housing costs and high interest rates will likely mean more boomers choosing not to buy,” he said.
