Rennie says boomers will sell homes and help their kids purchase…but will the kids still be in Vancouver when this happens?
Baby boomers are sitting on $88 billion in equity in Greater Vancouver and they’re looking at their retirement years. That equity will be freed over the next 15 years [and] when they sell their home, they’ll buy down and help their kids.
That’s what Vancouver real estate developer and President of Rennie Marketing Systems, Bob Rennie, told the Vancouver Sun after his keynote address to the Urban Development Institute on Thursday evening. I think he’s right that the astute developer will focus on the downsizing boomer generation over the next 8-10 years. And, sure, the equity that my parents’ generation pull from selling their family homes will be significant. Finally, it is fair to say that most parents put in this fortunate position, would want to help out their kids with purchasing a home…but, at this rate, will these homes be in Vancouver? Or will we see the money from this long term Vancouver equity vanish from the city to the suburbs and beyond? Consequentially, if the kids move out of the city, will Mom and Dad want to stay in Metro Vancouver? Or will everyone move out together?
I know for my family, proximity is very important. It is one of the reasons we purchased where we did (i.e. so we could be close to family). With all the demands put on parents today (typically both parents working full time – therefore resulting in a great need for childcare) many families are returning to the “it takes a village” approach. This doesn’t really work if Grandma and Grandpa live in Dunbar and all the kids and grand kids live in Port Coquitlam or Abbotsford. What I think we might see a slight increase in is multi-generations of families moving out of the city into more suburban settings. Another option is that the kids (and little ones) move into the family home and Mom and Dad set up house in a lane way house or basement suite. Perhaps developers should also be focusing on multi-generational housing options as well?
So, yes, there is a lot of money to be made from “boomer equity”. However, whether all of it will remain in Metro Vancouver remains to be seen.