Baby Boomers & Rural Housing Trends

Kelly Asche works with the programming and data teams at Center for Small Towns. Kelly is a lead organizer for the Symposium on Small Towns and works with development leaders from around the state to cultivate rural data and rewrite the rural narrative.

As CST prepares for this year’s Symposium on Small Towns: Rural Housing – Moving In, Out, and Forward, I have had a crash course in all things housing. I am no expert on housing, but we have organized a very talented steering committee composed of representatives from state and local housing agencies, rural housing researchers, and local community and economic development professionals.

In my last post about housing, I outlined the enormous demographic shifts that are going to occur over the next 30 years in rural Minnesota. The baby boomer generation is going to have a tremendous impact on rural housing, and it’s important to understand and attempt to predict their trends in the coming years. One of our steering committee members, LaRhae Knatterud, is a key expert on baby boomer housing preferences in Minnesota and she has introduced us to some important aspects to keep in mind when thinking about rural housing.

It is no surprise that the baby boomer generation has driven several housing market trends since the 1960s; building apartments, housing developments with large lots, suburban growth, the escalation in house prices and, over the past few decades an increase in upsizing. Policies were changed during this generation’s peak household formation to encourage homeownership, and these policies favored large lot development and single-family homes. Due to these incentives, homeownership rates increased from 43% in 1940 to 66% in 2010 (Bill Fallon, “Boomers and Millennials at Odds on Housing,” Fairfield County Business Journal 51, no. 15 (April 13, 2015): 5.).

Retaining and recruiting households of this generation needs to be a key strategy for small towns. Fortunately, we do have some evidence of what this generation’s preference is for location and housing as they continue to age. The Minnesota Department of Human Services | Project 2030 conducted a baby boomer survey that focused on this generation’s thoughts on housing and work over the next 10 years. There are some key aspects that point to some excellent opportunities for small towns.

  1. Only 10% of boomers in small towns and rural Minnesota were likely to consider moving from their communities in the next 10 years.
  2. Boomers in the suburbs were the most likely to consider moving in the next 10 years (26%) and even more so in the next 20 years (78%).
  3. Of the boomers in suburbs considering moving from their communities, nearly a third of them were looking at small communities.

These numbers point to an opportunity for small towns to retain their baby boomer population, and possibly recruit more households from this generation.

This survey is no outlier as national surveys do show similar preferences. A national survey implemented by the Demand Institute showed most households in this generation want to age in place, while 37% plan on moving from their current homes, and those that want to move want to own their next home, live on a single floor, and have some room for extended family.

The industry also has a lot to say about how communities should redevelop to align with baby boomer preferences. These include community walkability, intergenerational housing developments, townhomes, mixed-use developments, and having nearby amenities such as a grocery store, pharmacy, and reasonably nearby clinics (“Key Findings – dhs16_170501.pdf”; Miles, “Connected Community”; Fallon, “Boomers and Millennials at Odds on Housing”; Marilyn Much, “Builders See Baby Boomer House-Hunting”; Nelson, “Catching the Next Wave.”). However, none of the surveys and research show that these preferences are a majority, nor are they deal breakers for boomers looking to move.

However, there are some significant challenges when looking at rural boomers wanting to age in place. The Project 2030 Survey provided some alarming results that need to be considered as policy-makers and small town leaders move forward with housing initiatives. Only 17% of rural boomers indicated they were going to use their own savings and investments to pay for future long-term care costs. Nearly 40% of rural boomers said they do not know how they will pay for long-term care costs, and only 50% were currently working full-time when they completed the survey. This points to a significant gap between what the boomers prefer, and the reality of living out those preferences.

In addition, rural boomers were most likely to have lived in their homes 20 years or more. Dilapidated housing has already been identified as a significant issue in some of our communities, and this points to the exacerbation of that challenge.

This research leaves us a lot to unravel because it touches upon so many different housing issues; retrofitting homes, long-term home care, housing maintenance, transportation, etc….. And this is only discussing one aspect of our population. In future posts we will be discussing housing issues related to millennials, immigrant populations, and our most vulnerable populations.

To sign up for Symposium updates and to be notified when registration opens, sign-up here.

2016 Symposium on Small Towns: Rural Housing – Moving In, Out, and Forward

June 7 – 9, 2016

University of Minnesota Morris


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