The Vero Beach housing crisis is facing a whole new and different problem in the future, as Baby Boomers retire and are forced to spend more for housing than any generation before them.
By 2030, the number of adults age 65 and older will more than double to 73 million, according to a report by the Harvard Joint Center for Housing Studies and the AARP Foundation.
Many of these retirees will need to put so much of their income toward housing — more than 30% — that they will have to cut back on other expenses like transportation, medical care, even food, the report found.
More Seniors Owe More Money on Vero Beach Housing Than Ever Before
A growing number of seniors are carrying mortgage debt into retirement, with more than 70% of younger Boomers ages 50 to 64, and 40% of those age 65 and older still owing money on their home in 2010. Even worse, they owed even more money on their loans, which is putting many older Americans in a "financially precarious" position, according to the report.
Adding to Boomers' burdens, less money is expected to come in. Over the next decade, the number of households age 65 and older living on less than $15,000 a year — below the poverty level for a two person household in 2014 — is projected to grow by nearly 40%.
The report recommends a variety of fixes for this Vero Beach housing crunch, including property tax relief for seniors, increased federal rental assistance and improved programs to help seniors "age in place" in their homes, instead of in costly institutions.
In 2011, just one-third of low income seniors who were eligible for federal rental assistance received any assistance at all.
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The confidence level towards Vero Beach real estate is on the rise according to the latest Zillow Housing Confidence Index. Homebuyers generally feel more positive about the Vero Beach real estate market now compared to the beginning of the year. The index was 63.7 in January, but increased to 64.2 during the summer.
The Housing Confidence Index is measured on a scale of 0 to 100, and readings above 50 show a positive market sentiment. Sub-sectors within the index look at buying and selling conditions, predicted changes in home values, market trends, home affordability, home buying plans and attitudes towards home ownership. Residents in the areas surveyed reported increased overall confidence in the Vero Beach real estate market.
Younger Renters See Themselves Buying Vero Beach Real Estate
Younger renters were most optimistic about their future home buying prospects, and some 82% of those aged between 18 and 34 were pretty confident they would be able to buy their own Vero Beach real estate someday. In comparison 64% of those aged 34 to 49 felt this way, and just 48% of those aged 50 to 64 thought they'd be able to buy their own Vero Beach home.
The younger generation also have a much more optimistic view about the Vero Beach real estate market in general, and a 33% expected property values to rise more than 6% annually over the next 10 years compared to just 21% of middle-aged respondents, and 15% of those falling into the older age group.
Although strong aspirations are no substitute for financial capacity or credit worthiness on a mortgage loan application, feedback from millennial renters is significant because it confirms that they bear relatively few psychological scars from the housing bust, and because the attitudes of this generation will drive housing trends in the decades to come.
Experts point out we need this generation to feel confident about home ownership, and we should want them to buy regardless of the fact that they may initially struggle to purchase a home.
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Vero Beach home prices increased in August, yet the pace of these gains continues to slow, helping to improve affordability for potential buyers.
Real estate data provider CoreLogic said recently that Vero Beach home prices rose 6.4 percent in August compared with a year ago. That marks a decline from an annual gain of 6.8 percent in July. Vero Beach home prices had been rising as much as 12 percent yearly toward the end of last year.
Vero Beach Home Prices Not Adjusted for Seasonality
Prices rose 0.3 percent in August from July. But CoreLogic's monthly figures aren't adjusted for seasonality, such as buying that occurs during warmer weather.
Sales struck a plateau in the middle of last year and have remained subdued for much of 2014. As sales have slowed, so have price gains. That should eventually make it easier for would-be buyers to afford a Vero Beach home.
As the pace of price gains has slowed, so have sales of existing homes.
Home Prices Dropping Nationwide Too
Nationwide, the National Association of Realtors reports that purchases fell 1.8 percent to a seasonally adjusted annual rate of 5.05 million in August. Sales fell from a July rate of 5.14 million, a figure that was revised slightly downward. Overall, the pace of home sales has dropped 5.3 percent year-over-year.
Economists associate annual sales of 5.5 million with a healthy market.
The NAR also said that median sales prices had risen 4.8 percent over the past 12 months to $219,800, but that average slipped slightly in August compared to prices in July and June.
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Like it or not, we all live in a digital age. But now, smart gadgets for your Vero Beach home are making things inside your home completely controllable outside of your home, using your smart phone.
Living in Digital Times technology editor Andrea Smith discusses some of her favorite gadgets for the ultimate connected home.