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'They Can't Afford To Move Out' — CEO Meredith Whitney Warns Most Baby Boomers Are Stuck In Place, Squeezing Millennials From The Real Estate Market
'They Can't Afford To Move Out' — CEO Meredith Whitney Warns Most Baby Boomers Are Stuck In Place, Squeezing Millennials From The Real Estate Market

Yahoo

time3 days ago

  • Business
  • Yahoo

'They Can't Afford To Move Out' — CEO Meredith Whitney Warns Most Baby Boomers Are Stuck In Place, Squeezing Millennials From The Real Estate Market

Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Many baby boomers are remaining in their homes because they can't afford to move, a trend that is contributing to a tighter housing market for younger generations, according to Meredith Whitney, chief executive officer of Meredith Whitney Advisory Group. In a May 7 interview with Bloomberg TV, Whitney explained that cash-strapped boomers are aging in place, leading to a generational gridlock that's limiting housing supply and hindering millennial homeownership. Don't Miss: Hasbro, MGM, and Skechers trust this AI marketing firm — Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – Boomers have bounced back as the largest home buying demographic in the U.S., accounting for 42% of all purchases in 2024, while millennials have dropped to 29%, according to the National Association of Realtors. But this doesn't mean most boomers are rolling in retirement riches. Whitney told Bloomberg that the common belief that all seniors are wealthy is misleading — many are borrowing against their homes just to get by. Whitney said that 44% of all home equity loans are being taken out by people aged 62 and older. "That's counterintuitive. It's crazy, right?" Whitney said. She added that only about one in 10 seniors can afford assisted living, forcing the rest to stay put whether they want to or not. A study by the International Council on Active Aging proves her assertion. Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — While boomers hang on to their homes — or scoop up new ones with equity-fueled cash — millennials are finding themselves priced out and inventory-starved. Rising interest rates, skyrocketing home prices, and stiff competition from cash buyers are major obstacles. The tight housing market is pushing more millennials into long-term renting or back into multigenerational living. Compounding the issue is what Whitney called the 'lock-in' effect — a term referring to homeowners with low mortgage rates who are reluctant to buy again at today's elevated costs. Boomers who refinanced or bought when rates were around 3% don't want to jump into the 7% territory now, so they stay. That means fewer homes go up for sale, and supply continues to shrink. "This is one of the problems with the housing inventory," Whitney told Bloomberg. "They're staying in their houses longer because they can't afford to move out."Whitney further issued a warning: a "mild to medium" recession may be coming, and Wall Street hasn't priced it in yet. She expects the U.S. unemployment rate to hit 6% by this fall— a rise from April's 4.2% rate, according to the Bureau of Labor Statistics. The forecasted downturn, she said, is fueled in part by weaker consumer spending and disruptions in retail and hospitality linked to President Donald Trump's ongoing tariff policies. Still, Whitney emphasized that unlike during the 2008 financial meltdown, the big banks are now well-capitalized and not at the center of the storm. "The big banks will not be involved now," she told Bloomberg, "but the consumer is already struggling and is going to struggle further. And that will translate into job losses." Read Next: , which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. 'Scrolling To UBI' — Deloitte's #1 fastest-growing software company allows users to earn money on their phones. Image: Shutterstock Send To MSN: 0 This article 'They Can't Afford To Move Out' — CEO Meredith Whitney Warns Most Baby Boomers Are Stuck In Place, Squeezing Millennials From The Real Estate Market originally appeared on

Housing market faces 'frozen' outlook amid elevated rates
Housing market faces 'frozen' outlook amid elevated rates

Yahoo

time20-05-2025

  • Business
  • Yahoo

Housing market faces 'frozen' outlook amid elevated rates

Higher mortgage rates and stubborn home prices are freezing the US housing market. Meredith Whitney, CEO of Meredith Whitney Advisory Group, joins Morning Brief to explain that affordability is deteriorating while a weak spring homebuying season could be a drag on GDP (gross domestic product). Also catch Meredith Whitney weigh in on the economic pressures that many American households are feeling right now. To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. Sign in to access your portfolio

Households have 'no wiggle room' amid inflation: Meredith Whitney
Households have 'no wiggle room' amid inflation: Meredith Whitney

Yahoo

time20-05-2025

  • Business
  • Yahoo

Households have 'no wiggle room' amid inflation: Meredith Whitney

The US economy is still holding steady by the numbers, even as consumer sentiment hits near-record lows. Meredith Whitney, CEO of Meredith Whitney Advisory Group, joins Morning Brief with Madison Mills to explain why over half of US households are barely hanging on despite solid employment data. To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. The most hard economic data showing the US economy, it's been holding steady, a signal that's at odds with how Americans may be actually feeling. University of Michigan consumer sentiment hitting the second lowest level on record in May, even as inflation continues to cool and the unemployment rate hovers near a historic low. Joining us now to dive into that disconnect, Meredith Whitney, Meredith Whitney advisor groups, CEO, Meredith, great to have you here. In a recent note, you wrote that over half of US households are barely holding on and yet at the same time we have the employment data holding up, the so-called hard data holding up. Uh to what extent do you think that there could be a risk out there that is similar to that 2008 housing market crash that you predicted? I don't think there's a risk of a there's clearly no risk of a housing market crash. Um consumer households or households are as unleverage as they've been in 40 years. Um so leverage is the lowest it's been in in 40 years. Um but I think if you dig down into how consumers and households are really doing, um over 50% of households um have already been through the their first recession. um that was two years ago. Um and I think they're going into uh their second recession in two in three years. Um so 52 plus percent of households are living paycheck to paycheck. Um and they've really been squeezed by the cumulative inflation of um of higher food prices, higher um insurance costs, higher you know, costs across the board. Um and when you look at these households, uh a great number of these households are employed in the sectors that are have been under the most pressure. So clearly aggregate spending has slowed, um definitely in travel, leisure, um and hospitality and in retail. And I think that's where you're going to see pressure in terms of um uh job losses. But I think you'll also see um uh pressure in general from uh a clear and the these households have no wiggle room in terms of inflation and I see inflation across the board. So let's talk about what Walmart said last week, which was um that you know, they tried to maintain prices on grocery, um but they'd put price uh uh increase prices um in other areas of the market. I think grocery prices are going to go up again. So one thing that has not been discussed uh broadly at all is um uh uh immigration and ice rates. And recently a private equity company said that they see cracks in the economy because um uh workers are not showing up work for fear of ice raids. So there've been ice rates across the board at uh areas at you know, workplace areas. um and when employees don't show up to work, um revenues suffer because in the instance of uh quick service restaurants there's no one to man the kitchens. Um so I think you're going to see uh uh uh pressure revenue pressure in their those areas, they'll cut uh they'll cut jobs um just to maintain um uh profitability. Um and then you'll see more consumer squeezed. Right.

Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says
Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says

Yahoo

time11-05-2025

  • Business
  • Yahoo

Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says

While baby boomers are collectively sitting on $75 trillion in wealth, that's not distributed evenly, meaning many can't afford to move out and instead must stay in their homes. That's weighing on the housing market by holding back inventory, according to top Wall Street analyst Meredith Whitney. Baby boomers are dragging on the housing market because most can't afford to move out of their homes, according to Meredith Whitney, the 'Oracle of Wall Street' who predicted the Great Financial Crisis. In an interview on Bloomberg TV on Wednesday, she said many cash-strapped Americans have been borrowing against their homes, and 44% of home-equity loans are being taken out by seniors, "which is counterintuitive. It's crazy, right?" That's contrary to the typical narrative of baby boomers sitting on vast amounts of wealth accumulated over their lifetimes, which spanned unprecedented economic expansions and stock market booms. As a result, seniors with a lot of money have an edge in the tight housing market, accounting for 42% of all homebuyers, while millennials account for 29% despite the younger generation being in the prime buying years. But while most buyers are boomers, it doesn't mean most boomers have a giant pile of cash. "I divide it into different cohorts," Whitney said. "So the senior which everyone thinks 'the boomers have all this money'—that's a small portion. Seniors are living paycheck to paycheck." To be sure, boomers collectively have $75 trillion of wealth. But that's not distributed evenly, and Whitney estimated that just one in 10 seniors can afford assisted-living facilities. As a result, many are forced to stay put and age in place, she added. (Stubbornly high mortgage rates also have created a "lock-in" effect where homeowners who got in the market when rates were low are now reluctant to buy a new home at today's elevated borrowing costs.) "This is one of the problems with the housing inventory," Whitney told Bloomberg. "They're staying in their houses longer because they can't afford to move out." Meanwhile, she expects the economy to slow amid President Donald Trump's trade war, especially in the retail and hospitality sectors, and predicted the unemployment rate will climb to 6% by this fall, up from the current level of 4.2%. That's still well below the 10% high that the jobless rate hit during the Great Financial Crisis, and Whitney doesn't see parallels between today's economy the one during the crisis. Part of the reason is because banks are much better capitalized now than they were back then, when sub-prime mortgages were weighing on banks' balance sheets. But she does see a "mild, medium" recession that Wall Street has yet to price in. "The big banks will not be involved now, but the consumer is already struggling and is going to struggle further. And that will translate into job losses," Whitney said. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says
Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says

Yahoo

time11-05-2025

  • Business
  • Yahoo

Most baby boomers can't afford assisted living and are weighing on the housing market by staying in their homes, ‘Oracle of Wall Street' says

While baby boomers are collectively sitting on $75 trillion in wealth, that's not distributed evenly, meaning many can't afford to move out and instead must stay in their homes. That's weighing on the housing market by holding back inventory, according to top Wall Street analyst Meredith Whitney. Baby boomers are dragging on the housing market because most can't afford to move out of their homes, according to Meredith Whitney, the 'Oracle of Wall Street' who predicted the Great Financial Crisis. In an interview on Bloomberg TV on Wednesday, she said many cash-strapped Americans have been borrowing against their homes, and 44% of home-equity loans are being taken out by seniors, "which is counterintuitive. It's crazy, right?" That's contrary to the typical narrative of baby boomers sitting on vast amounts of wealth accumulated over their lifetimes, which spanned unprecedented economic expansions and stock market booms. As a result, seniors with a lot of money have an edge in the tight housing market, accounting for 42% of all homebuyers, while millennials account for 29% despite the younger generation being in the prime buying years. But while most buyers are boomers, it doesn't mean most boomers have a giant pile of cash. "I divide it into different cohorts," Whitney said. "So the senior which everyone thinks 'the boomers have all this money'—that's a small portion. Seniors are living paycheck to paycheck." To be sure, boomers collectively have $75 trillion of wealth. But that's not distributed evenly, and Whitney estimated that just one in 10 seniors can afford assisted-living facilities. As a result, many are forced to stay put and age in place, she added. (Stubbornly high mortgage rates also have created a "lock-in" effect where homeowners who got in the market when rates were low are now reluctant to buy a new home at today's elevated borrowing costs.) "This is one of the problems with the housing inventory," Whitney told Bloomberg. "They're staying in their houses longer because they can't afford to move out." Meanwhile, she expects the economy to slow amid President Donald Trump's trade war, especially in the retail and hospitality sectors, and predicted the unemployment rate will climb to 6% by this fall, up from the current level of 4.2%. That's still well below the 10% high that the jobless rate hit during the Great Financial Crisis, and Whitney doesn't see parallels between today's economy the one during the crisis. Part of the reason is because banks are much better capitalized now than they were back then, when sub-prime mortgages were weighing on banks' balance sheets. But she does see a "mild, medium" recession that Wall Street has yet to price in. "The big banks will not be involved now, but the consumer is already struggling and is going to struggle further. And that will translate into job losses," Whitney said. This story was originally featured on

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