Empty-nest baby boomers own almost 30% of all large U.S. Homes. That’s twice as many as millennials with kids, who own just 14.2% of the country’s large homes. Gen Zers with kids own almost none (0.3%) of them. This according to a new report from Redfin.
The Redfin report
The report is based on a Redfin analysis of U.S. Census data from 2022. In this report, Redin used the phrase “empty nesters” to refer to households headed by baby boomers with 1-2 adults living in the home.
It’s worth noting that even though millennials with kids own half as many large homes as empty nesters, there are more millennials than baby boomers. Millennials make up roughly 28% of the country’s adult population, the largest share of any generation. They’re followed by baby boomers (27%), Gen Xers (25%) and Gen Zers (12%).
Why baby boomers have more space
Here are a few reasons why baby boomers own a large number of larger homes.
- There’s not much financial incentive to let go of large homes. Most boomers who own homes have no mortgage. For that group, the median monthly cost of owning a home, which includes insurance and property taxes, among other costs, is just $612! For the boomers who do have a mortgage, nearly all have a much lower interest rate than they would if they sold and bought a different home with today’s near-7% rates.
- For millennials and Gen Zers, it’s harder to find and afford a home. Large homes are in short supply, largely due to the mortgage-rate lock-in effect and a recent lack of homebuilding.
- Some young Americans don’t want to own a home. A recent Redfin survey found that 12% of millennials who believe they’ll never own a home aren’t interested in homeownership, and 7% said they don’t plan to buy because they don’t want to maintain a home.
- Boomers built wealth. Many older Americans benefited from an abundance of newly built homes and favorable economic conditions during their prime moneymaking years, during the 1990s economic boom. Those homes proved to be good investments: Home values have grown four times faster than incomes over the last several decades.
- Boomers are older, so they’ve had more time to buy homes. Simple.
“There’s unlikely to be a flood of large homes hitting the market anytime soon,” said Redfin Senior Economist Sheharyar Bokhari. “Logically, empty nesters are the most likely group to sell big homes and downsize: They no longer have children living at home and don’t need as much space. The problem for younger families who wish their parents’ generation would list their big homes: Boomers don’t have much motivation to sell, financially or otherwise.”
Many young families are renting large homes in the meantime. Millennials with kids take up one-quarter of the three-bedroom-plus rentals in the U.S., the largest share of any generational category, followed by millennials without kids (11.6%). Empty-nest baby boomers take up the next-highest-share (11.4%) of three-bedroom-plus rentals.
45% of empty nesters own big homes, almost double the share of millennials with kids
The above addresses the share of large homes owned by each generation and household type. In looking at the share of each generation and household type that owns large homes, Redfin found that empty-nest baby boomers are almost twice as likely as millennial families to own three-bedroom-plus homes. Nearly half (45.5%) of one-to-two-person boomer households own large homes while just over one-quarter (27%) of households consisting of millennials with kids own large homes. Roughly 3% of Gen Zers with kids own them.
What type of home do the rest of millennials with kids live in?
Some young families rent large homes: Roughly 1 in 10 (9.3%) millennial-with-kid households live in three-bedroom-plus rentals. Others rent smaller units.
Other millennials live with family or roommates. Of all U.S. millennials (whether they have kids or not), roughly 17% of them live with a family member in a home that family member owns or rents–most likely their parents. Another 10% live in a home owned or rented by someone they’re not related to–most likely a roommate. Seven in 10 are the head of their own household, whether they’re owning or renting.
Older Americans own a much bigger share of large homes than they did 10 years ago, and young families own a smaller share
Who owns large homes has changed over the last decade. In 2012, empty nesters of the silent generation (who were 67-84 at the time) took up 16% of three-bedroom-plus homes. That’s a smaller share than Gen Xers (who were 32-47 at the time) with kids, who took up 19% of those large homes.
But one thing has remained the same over time: Baby boomers with no kids living at home take up the lion’s share of big houses. In 2012, empty-nest boomers (who were then 48-66) owned and occupied 26.4% of three-bedroom-plus homes in the U.S., comparable to today’s share.
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Empty nesters take up at least 20% of large homes everywhere in the U.S.
Empty-nest baby boomers take up the biggest share of large homes in relatively affordable Rust Belt and southern metros. Baby boomers with one or two people in the household take up roughly one-third of three-bedroom-plus homes in Pittsburgh, PA (32.1%), Birmingham, AL (31.1%) and Cleveland, OH (30.8%), the highest shares in the nation. Next come Buffalo, NY (30.5%) and Virginia Beach, VA (30.4%). Demographics are one reason why Pittsburgh tops this list; the metro skews older: Baby boomers make up 40% of Pittsburgh’s households, a far higher share than Gen Xers (27%) or millennials (20%).
Empty nesters own at least 20% of large homes everywhere in the country. They take up the smallest share of three-bedroom-plus homes in popular migration destinations and California metros: Riverside, CA (21.9%), Salt Lake City, UT (22%), Austin, TX (22.2%), Houston (23.2%) and San Jose, CA (23.7%).
No matter the metro, millennials with kids take up no more than 18% of three-bedroom-plus homes
Young families take up the smallest share of large homes in coastal California and Florida, where large homes tend to be more expensive, and the largest share in relatively affordable inland metros.
Just about one of every 10 three-bedroom-plus homes are owned and occupied by millennials with kids in Los Angeles (9.4%), San Jose, CA (10.4%), San Francisco (10.9%), Miami (11.2%) and New York (11.8%) Millennials with kids have the largest share in Indianapolis, IN (17.6%), Minneapolis (17.4%), Cincinnati, OH (17%), Kansas City, MO (16.5%) and Riverside, CA (16.5%).