B
aby boomers now own the majority of U.S. homes, a fact that keeps the housing market stalled for years to come, says Wall Street analyst Meredith Whitney. In a Financial Times op‑ed, Whitney—known as the “Oracle of Wall Street” for her 2008 crisis call—notes that seniors hold more than 54 % of all homes, up from 44 % in 2008. Of those, 79 % are owner‑occupied, and three‑quarters are mortgage‑free, giving them vast equity that can offset rising costs such as insurance.
“This equity lets seniors stay put,” Whitney explains. “The next three to four years will see a surge in funding from this source.” The fastest‑growing consumer debt is now home‑equity lines of credit, with seniors accounting for 41 % of the revolving balance. Other credit products also allow homeowners to tap their property for cash. The result: inventory remains tight because boomers are unlikely to downsize and have the means to stay.
“Expect the market to stay very different from before,” Whitney warns. “Even as 30‑year rates fall, existing‑home sales won’t jump. Seniors control the board, and with so many options, they’re not moving.” This reality hurts millennials and Gen Z, whose first‑time‑buyer numbers hit historic lows as affordability erodes.
In May, Whitney added that many boomers cannot afford to relocate and are borrowing against their homes to stay. While the cohort’s combined wealth is $75 trillion, it’s unevenly spread; Whitney estimates only one in ten seniors can afford assisted‑living facilities. “Seniors are living paycheck to paycheck,” she told Bloomberg TV.
The boomers’ hold on the market is one drag among several. Trump’s tariffs and immigration crackdown have slowed new‑home supply, while economic anxiety and still‑high prices dampen demand, even as mortgage rates dip. Homeowners are pulling listings, further tightening inventory.
A weak housing market threatens the broader economy. Economist Ed Leamer’s 2007 paper identified residential investment as the best leading indicator of recession. In Q2, residential investment fell 4.7 %, up from a 1.3 % decline in Q1. Moody’s Analytics chief economist Mark Zandi labeled the housing market a “red flare,” citing squeezed sales, building, and prices amid high rates. Building permits, a key construction indicator, have been falling, and Zandi warned they are the most critical variable for predicting recessions. Moody’s leading‑indicator model now puts the 12‑month recession probability at 48 %—the highest it has been without an actual downturn.
Fortune Global Forum returns Oct. 26–27, 2025 in Riyadh. CEOs and global leaders will gather for a dynamic, invitation‑only event shaping the future of business. Apply for an invitation.
