Tuesday, May 02, 2006


While working in my office on an offer/counter offer on a home in Garden Valley, Tom called. He had been previewing my web site and decided to call me to discuss his particular situation. Tom had just turned 60, he was retiring from his job in a few months and he and his wife wanted to move out of the Bay Area to a more rural setting. Tom had driven through Placerville a few times on his way to South Lake Tahoe and was seriously considering settling in the area after he sold his house in Freemont.

Tom like Bill Clinton and George W. Bush (both born in 1946) are among the front-runners of a large generational wave consisting of 70 million babies born between 1946 and 1964. Retiring Baby Boomers will have an impact on most every aspect of our economy including the county’s future housing values.

Tom’s story was familiar. Now that retirement was a reality he was seeking a more relaxed, less congested environment to spend the next chapter of his life. His story is a real life example of a migration taking place all over the country and confirmed by a report last week in a US Census Bureau study on domestic migration. The report tracks where people are leaving from and moving to between 2000 and 2004.

According to the study, more Californians are leaving the state than moving here. Each year nearly 100,000 more Californians moved out of state than moved in. This net out-migration is predominately from our larger metro regions such as Los Angeles, Santa Ana and Long Beach in the south and San Francisco/Oakland and Freemont region in the north. The yearly net out-migration of 61,000 people from the Bay Area has been increasing in recent years. So where are all these people going?

If Californians are moving out of state they are likely to end up in Arizona, Nevada and Washington. Riverside and San Bernardino Counties in the south have been gaining 75,000 in yearly net in-migration, while Sacramento, Placer and San Joaquin Counties have been the large recipients further north.

Many fleeing the big cities are seeking lower cost of housing. Affordable housing in our region has been attracting Bay Area homebuyers, investors and flippers for years. But many like Tom and millions of other retiring Baby Boomers are seeking a sanctuary of open space and woodland.

New consumer research, conducted by ProMatura Research and presented at the annual convention of the National Association of Home Builders in Orlando, provided some insight as to where Boomers want to live when they retire. On a golf course in a senior community didn’t even make the top ten list. The most popular vocational or environmental draws for boomers were “fresh water” and “green space”. Over 25 percent of likely movers over 55 told researchers they want to buy real estate “directly on”, or “with a view of”, or “near” fresh water such as lakes, rivers or ponds.” Nearly 12 percent want to buy real estate surrounded by “green space” such as “parklands”, “fields” or “trees” and 27 percent said they want to see “green space out their windows.” Do you know of anyplace close by meeting that description?

Over the past 150 years the value of real estate in the Sierra Foothills has been influenced by natural recourse extraction, agriculture and the availability of less expensive land within close proximity to major employment. Until very recently, open green space had not been assigned a value except by a few environmental groups. That thinking is changing. Many retiring Boomers, desiring to remain in California are seeking the inherent benefits that a rural country lifestyle has to offer. It’s not local employment that will attract well off boomers to pay premium prices for our real estate. It’s open green space. Our politicians and planners should focus on preserving the real value of county real estate before we lose it.


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