'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

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.

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Boomers Are Buying More Homes — But Not Because They're Loaded

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.

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Millennials Hit A Housing Wall

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."

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Recession On The Horizon?

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."

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