April 15, 2018

Get ready for the age-centric trend sweeping the Tri-Cities


The Census Bureau's population projections are usually a dry topic that gets little public attention. But that wasn't the case last month. It was different because the bureau drew a demographic line in the sand. Its said that in less than two decades, older adults are projected to outnumber children for the first time in U.S. History.

2018 NETAR President

It was an Aha moment even though it wasn't exactly new news. Population projections have pointed to it since 2000. Maybe the difference was the shock of hearing it in a culture and economy that is often obsessed with youth.

This line in the sand is even more significant when you localize it because the Tri-Cities crossed it a couple years ago.

That's right. We're already at that point that the nation will reach in 2035.

According to the 2016 American Community Survey, the seven-county Johnson City-Kingsport-Bristol Consolidated Statistical Area (CSA) had had almost 9,000 more people 65 and older than it did 19 and younger. And since about 29 local residents a week are celebrating their 65th birthday - and birth rate is not increasing - the gap isn't narrowing. The same report shows another 73,718 people in the 55 to 64 years-old range. And according to the Tennessee State Data Center, the bulk of the NE Tennessee's population this year is 50 to 59, so the aging population wave hasn't crested here, yet. But that doesn't mean the aging trend hasn't affected the local economy and housing market or that more change is coming.

John Burns, CEO of John Burns Real Estate Consulting, and his staff did some intensive research and thinking about this trend. The result was a little book "Big Shifts Ahead: Demographic Clarity for Businesses." It has some serious insights about housing.  Here are a few examples capsuled in a recent issue of the Daily Real Estate News:

  • The aging trend will spark even greater demand for high-density, low-maintenance living and what Burns calls "surban" (urban living in suburban environments).
  • More Baby Boomers will help their children with down payments on a home so their children can live nearby.
  • During the next decade, the exodus of people moving to the South and Mid-South will increase as new residents move to take advantage of lower taxes, warmer weather, and a growing jobs economy. The 2017 Census population projections show new comers to our region increased last year. That was driven by improving housing markets elsewhere that allowed owners to sell their existing homes so they could relocate.
  • Burns estimates there will be 25.8 million newly formed households in the nation during the next 10 years, and 13.3 million of them will move to a household vacated by someone who dies or has moved into assisted living facility. And these people will fill their homes with all sorts of technology.

That 2016 Census report also tells us that homeowners moved into 16% of the occupied households in the Tri-Cities between 1990 and 1999. That's almost 33,000 households where owners have been building equity for 19 to 28 years. Another 16,500 owners moved into their homes in 1980 to 1989. And there almost 23,000 owners who moved in in 1979 or earlier. Totaled that's 72,000 households or about 35% of all of the households in the Tri-Cities region that are potentially on the cusp of the effects of the aging trend on housing.

At the same time, there is an increasing number of local Realtors® who have stepped up their expertise with an SRES® designation to accommodate the aging trend and special needs of aging homeowners.  SRES® is the designation tailored to educated Realtors® on how to serve the real estate needs of the fastest growing market in real estate, clients age 50+. Professionals earn this designation by completing an extensive prerequisite of coursework. That makes them better equipped to be professional partners throughout the entire processes involved in a late-in-life move.

The increasing number of local Realtors® with an SRES® designation is just one example of how Realtors® monitor and prepare themselves for the ever-changing real estate market.

Aaron Taylor is the 2018 president of the Northeast Tennessee Association of Realtors. The real estate education and trade group is the voice for real estate in the Tri-Cities and has over 1,200 local Realtor® members and almost 100 affiliates