Economy

ON THE MONEY: Baby boomers have different desires in housing

WAVE NEWSPAPERS — Unlike just 15 years ago, many baby boomers are discovering that the large, high-end homes with their high-maintenance costs no longer fit their needs as they grow older. And younger people aren’t buying big houses, either.

Published

5 years ago

April 12, 2019

posted by Wave Staff

By John L. Grace

Unlike just 15 years ago, many baby boomers are discovering that the large, high-end homes with their high-maintenance costs no longer fit their needs as they grow older.

And younger people aren’t buying big houses, either. It wasn’t that long ago when boomer retirees were rushing to buy or build elaborate, five or six-bedroom houses in warm climates, fueled in part by the easy credit of the real estate boom.

Many baby boomers poured millions into these spacious homes, planning to live out their golden years in houses with all the bells and whistles.

“Tastes — and access to credit — have shifted dramatically since the early 2000s. These days, buyers of all ages eschew the large, ornate houses built in those years in favor of smaller, more-modern looking alternatives, and prefer walkable areas to living miles from retail,” according to the Wall Street Journal, March 21.

The Journal opined that the problem is expected to worsen in the 2020s, as more baby boomers across the country advance into their 70s and 80s, the age group where people typically exit homeownership due to poor health or death. Boomers currently own 32 million homes and account for two out of five or 40% of the homeowners in the country.

Buyers have been led down the path of focusing on location, interest rates and inventory. The most important factor to take into consideration, however, is buying behavior based on age.

Thanks to the U.S. Census Bureau and Dent Research we can see that Americans tend to buy their first house at 31, their largest around 41 and sell those same homes at 79.

Born between 1946 and 1964, baby boomers turn anywhere from 55 to 73 this year. From 1980 to 2000 40% of all homes purchased in the U.S. were on lot sizes of a half acre to 10 acres, according to Dent Research. That is a 20-year period, where individual thinking boomers who were doing the same thing at the same time of the age group couldn’t live without their magnificent McMansions.

It stands to reason for this observer that current prices are a direct result of 76 million Americans coming into the equation. It didn’t matter whether the population was legal or illegal, legitimate or illegitimate.

With all of that demand for housing coming out of the woodwork, home prices must go up. On the other side of the equation, it becomes reasonable that when boomers who constitute 24% of the U.S. population go to heaven the supply and demand principles come back into play.

When 130 years of residential real estate remains on this earth after 76 million people go to heaven without those McMansions, you tell me where you think prices are headed.

From 1929-32 New York real estate declined 69%, wrote Zubin Jelveh in The New Republic in September 2009. That’s the same time that the stock market was off 89%, according to Yahoo Finance.

Jelveh went on to say, “A home owner who would have invested in a house on the eve of the Great Depression would not have recovered the full value of their investment until four decades later.”

If you were an adult in the early 1900s the average age of death was mid-50s, according to the U.S. Census Bureau. So you died with great regret long before prices fully recovered.

Neither of those events could ever happen again, right? Investors understand buy low, sell high. The same stock logic applies to all highly appreciated assets.

Savvy investors don’t let emotion dictate their behavior. Or you can be in the middle the pack or at the back of a herd of cows, where the view and the smell never changes.

John L. Grace is president of Investor’s Advantage Corp, a Los Angeles-area financial planning firm that has been helping investors manage wealth and prepare for a more prosperous future since 1979. His On the Money column runs monthly in The Wave.

This article originally appeared in the Wave Newspapers.

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Business

Black Business Summit Focuses on Equity, Access and Data

The California African American Chamber of Commerce hosted its second annual “State of the California African American Economy Summit,” with the aim of bolstering Black economic influence through education and fellowship. Held Jan. 24 to Jan. 25 at the Westin Los Angeles Airport Hotel, the convention brought together some of the most influential Black business leaders, policy makers and economic thinkers in the state. The discussions focused on a wide range of economic topics pertinent to California’s African American business community, including policy, government contracts, and equity, and more.

Published

2 weeks ago

April 20, 2024

Oakland Post

Toks Omishakin, Secretary of the California State Transportation Agency (CALSTA), answers questions from concerned entrepreneurs frustrated with a lack of follow-up from the state. January 24, 2024 at the Westin Los Angeles Airport Hotel, Lost Angeles, Calif. Photo by Solomon O. Smith

By Solomon O. Smith, California Black Media

The California African American Chamber of Commerce hosted its second annual “State of the California African American Economy Summit,” with the aim of bolstering Black economic influence through education and fellowship.

Held Jan. 24 to Jan. 25 at the Westin Los Angeles Airport Hotel, the convention brought together some of the most influential Black business leaders, policy makers and economic thinkers in the state. The discussions focused on a wide range of economic topics pertinent to California’s African American business community, including policy, government contracts, and equity, and more.

Toks Omishakin, Secretary of the California State Transportation Agency (CALSTA) was a guest at the event. He told attendees about his department’s efforts to increase access for Black business owners.

“One thing I’m taking away from this for sure is we’re going to have to do a better job of connecting through your chambers of all these opportunities of billions of dollars that are coming down the pike. I’m honestly disappointed that people don’t know, so we’ll do better,” said Omishakin.

Lueathel Seawood, the president of the African American Chamber of Commerce of San Joaquin County, expressed frustration with obtaining federal contracts for small businesses, and completing the process. She observed that once a small business was certified as DBE, a Disadvantaged Business Enterprises, there was little help getting to the next step.

Omishakin admitted there is more work to be done to help them complete the process and include them in upcoming projects. However, the high-speed rail system expansion by the California High-Speed Rail Authority has set a goal of 30% participation from small businesses — only 10 percent is set aside for DBE.

The importance of Diversity, Equity and Inclusion (DEI) in economics was reinforced during the “State of the California Economy” talk led by author and economist Julianne Malveaux, and Anthony Asadullah Samad, Executive Director of the Mervyn Dymally African American Political and Economic Institute (MDAAPEI) at California State University, Dominguez Hills.

Assaults on DEI disproportionately affect women of color and Black women, according to Malveaux. When asked what role the loss of DEI might serve in economics, she suggested a more sinister purpose.

“The genesis of all this is anti-blackness. So, your question about how this fits into the economy is economic exclusion, that essentially has been promoted as public policy,” said Malveaux.

The most anticipated speaker at the event was Janice Bryant Howroyd known affectionately to her peers as “JBH.” She is one of the first Black women to run and own a multi-billion-dollar company. Her company ActOne Group, is one of the largest, and most recognized, hiring, staffing and human resources firms in the world. She is the author of “Acting Up” and has a profile on Forbes.

Chairman of the board of directors of the California African American Chamber of Commerce, Timothy Alan Simon, a lawyer and the first Black Appointments Secretary in the Office of the Governor of California, moderated. They discussed the state of Black entrepreneurship in the country and Howroyd gave advice to other business owners.

“We look to inspire and educate,” said Howroyd. “Inspiration is great but when I’ve got people’s attention, I want to teach them something.”

Oakland Post

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Bay Area

Port of Oakland Commission Votes to Change Oakland Airport to ‘San Francisco Bay Oakland International Airport’

The Port of Oakland Commission voted unanimously to change the name of Metropolitan Oakland International Airport to San Francisco Bay Oakland International Airport at a commission meeting Thursday afternoon. The Port initially announced the name change on March 29, claiming that the change will attract more passengers and enhance the airport’s visibility. They contend that the airport often gets neglected by the public’s lack of knowledge of Oakland’s proximity to San Francisco.

Published

2 weeks ago

April 19, 2024

Oakland Post

Port of Oakland commissioners voted unanimously to change the name of the Metropolitan Oakland International Airport to San Francisco Bay Oakland Airport at Commission meeting on April 11.

By Magaly Muñoz

The Port initially announced the name change on March 29, claiming that the change will attract more passengers and enhance the airport’s visibility. They contend that the airport often gets neglected by the public’s lack of knowledge of Oakland’s proximity to San Francisco.

“We want people to know where Oakland is and how beautiful our city is. We want them to visit, we want them to spend their money, and we want to keep our money into our local economy,” Port Commission President Barbara Leslie said at the meeting.

The commissioners shared anecdotal experiences and research to explain how this new name change will elevate and add to the growth of Oakland, not take away from their Bay Area neighbors.

The Port claimed that local residents had been asking for more options in domestic and international flights, but in order to do that, outside travelers need to be aware of Oakland’s presence first.

Since the announcement of the new name, San Francisco leaders strongly opposed the suggestion for a change, the City Attorney going as far as threatening legal action.

SF City Attorney David Chiu announced Monday that his team sent a letter to the Port of Oakland, writing that if Oakland goes forward with the name change, the city will go forward with a lawsuit to prevent the use of their trademarked name.

San Francisco owns U.S. federal trademark registrations for the marks “San Francisco International Airport”, the letter says.

Chiu further claimed that the name change will only cause confusion and chaos for travelers who are used to seeing the San Francisco name in the SFO trademark.

“We want to see the entire Bay Area thrive as a tourist destination and expand our offerings to visitors, but this proposal is not a legal or practical way to go about it. If Oakland moves forward with this proposal, San Francisco will pursue legal action to prevent misuse of our trademark,” Chiu said.

SF Mayor London Breed joined Chiu’s letter, stating that Oakland does not need to add the internationally popular city to its brand in order to grow its services.

“[Oakland] is rich in culture and wonderful people and has its own unique identity. It does not need the name San Francisco as part of its airport to stand out,” Breed wrote.

The Port defended its proposed actions, saying that if the vote did go forward, they would “take all appropriate measures to defend its right to use this accurate geographic identifier.”

“The proposed name modification will clarify, not confuse. The new name identifies where OAK is actually located, which is on the San Francisco Bay,” a spokesperson said on behalf of the Port.

Support for the name change extends beyond the Port. Several regional leaders, airlines and community members have come out in support of the name change, including Oakland Mayor Sheng Thao.

“This adjustment isn’t just about signage—it’s about inviting travelers to discover all that Oakland and the region have to offer. From our local dining scene to unique shopping spots and cozy hotels, there’s something here for everyone. Let’s work together to ensure that Oakland Airport continues to serve as a welcoming gateway for visitors and a source of pride for our community,” Thao said.

Because of public outcry amongst residents and leaders in Oakland and San Francisco before and during the Commission meeting, the Board decided to extend the second reading for the proposed name change from the end of April to the first meeting in May. This decision will allow commissioners to connect with community groups and leaders over their concerns for the change.

The Port Commission is scheduled to hold a second reading of the proposed name change on May 9.

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Business

V.P. Kamala Harris: Americans With Criminal Records Will Soon Be Eligible for SBA Loans

Speaking in Las Vegas on Jan. 27, Vice President Kamala Harris announced a forthcoming federal rule that will extend access to Small Business Administration (SBA) loans to Americans who have been convicted of felonies but have served their time. Small business owners typically apply for the SBA loans to start or sustain their businesses.

Published

2 weeks ago

April 16, 2024

Oakland Post

On her daylong trip, Harris was joined by Horford, SBA Administrator Isabella Guzman, Interim Under Secretary of Commerce for Minority Business Development Agency (MBDA) Eric Morrissette, and Sen. Catherine Cortez Masto (D-Nev).

By California Black Media

Small business owners typically apply for the SBA loans to start or sustain their businesses.

Harris thanked U.S. Rep. Steven Horsford (D-NV-04), the chair of the Congressional Black Caucus, for the work he has done in Washington to support small businesses and to invest in people.

“He and I spent some time this afternoon with business leaders and small business leaders here in Nevada. The work you have been doing to invest in community and to invest in the ambition and natural capacity of communities has been exceptional,” Harris said, speaking to a crowd of a few hundred people at the Brotherhood of Electrical Workers Hall in East Las Vegas.

“Formerly incarcerated individuals face significant barriers to economic opportunity once they leave prison and return to the community, with an unemployment rate among the population of more than 27%,” the White House press release continued. “Today’s announcement builds on the Vice President’s work to increase access to capital. Research finds that entrepreneurship can reduce recidivism for unemployed formerly incarcerated individuals by as much as 30%.”