The term “Silver Tsunami,” often referred to as “empty nesters,” describes the impending wave of Baby Boomers (individuals born between 1946 and 1964) who are approaching retirement. Baby Boomers make up approximately 21% of the U.S. population. As this generation ages, they are expected to have a significant impact on the economy, healthcare demand, the housing market, and politics.  

When compared to other generations, Baby Boomers hold the highest level of wealth. Over the next 20 years, they are projected to transfer more than $100 trillion to younger generations through inheritance. This is known as the Great Wealth Transfer, with a notable portion expected to come from real estate.  

What plans do Baby Boomers have for their homes, and how will this impact the housing market? 

In 2024, over 37% of homeowners across the country were Baby Boomers, and they are more prevalent in coastal states. According to Zillow, there is an oversupply of empty nest homes. Some think that this could help make an impact on housing shortages, but experts think otherwise. Most empty nest homes are located in affordable suburban and rural areas, which are typically far away from job centers that attract young professionals who would be first-time home buyers. However, some of Virginia’s largest metro areas were reported to have a high percentage of Baby Boomer homeowners relative to their populations compared to other large metro areas throughout the country. According to a report by Construction Coverage, about 39% of Richmond’s Baby Boomer population are homeowners, ranking 5th on this list. In the Virginia Beach-Chesapeake-Norfolk metro area, this percentage is 37.2%, while the Washington-Arlington-Alexandria metro area is 33.9%. In other metro areas in Virginia, the percentage of Baby Boomer homeowners is as follows: Charlottesville at 42.1%, Lynchburg at 41.3%, Blacksburg-Christiansburg-Radford at 40.7%, Roanoke at 39.9%, and Harrisonburg at 39.5%. 

Baby Boomers who own homes may choose to downsize or relocate to assisted living communities as they age, which could lead them to list their properties on the market in hopes of increasing inventory. However, many Boomers prefer to stay in their current homes, challenging expectations of increased inventory. According to a survey by Redfin, 78% of older American homeowners plan to stay in their homes as they age. During the pandemic, many Baby Boomers secured extremely low mortgage rates, diminishing their motivation to relocate, which further constrains the housing supply. Analysis reveals that millennials with children own 14% of three-bedroom homes or larger across the U.S., whereas empty-nest baby boomers hold 28% of these homes.  

The Silver Tsunami is influencing the economy and housing in several ways. Some Baby Boomers may be encouraged to sell their homes to access the equity they have built. Additionally, many heirs of these homes may wish to sell after inheriting them. Many Baby Boomers may also want to reduce the costs associated with maintaining larger homes and downsize as they enter retirement. It is important for housing officials, developers, and communities to proactively address this trend to ensure that housing remains accessible for all generations.