Unlike predictions of a mass sell-off as boomers hit retirement age, most are staying put.
Demographic and Housing Overview
Hawaiis population is aging rapidly.
Baby Boomers have high homeownership rates, directly affecting housing occupancy and turnover.
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Hawaii stands out in this regard it has the highest concentration of Boomer homeowners of any state.
Across Hawaii, Boomers control a huge portion of housing wealth.
Homeownership and Location Preferences: Urban vs.
Overall, the prevailing trend islimited relocation.
A strong majority of Hawaiis older residents have remained in their existing homes and communities as theyve aged.
Surveys indicate that as people age, they increasingly prefer to age in place.
Many have paid off mortgages and feel rooted in place, which reduces the incentive to move.
Urban vs.
These are predominantly suburban or rural communities.
The appeal is clear: calmer traffic, open space, and a strong sense of local community.
Downsizing vs.
Staying in Place
A central trend in the 20182023 period is the tension between downsizing and aging in place.
As noted, over 80% of Hawaii seniors 75+ express that they haveno intention to move.
Even among younger Boomers in their 60s, well over half plan to stay in their current home indefinitely.
This is higher than the U.S. average and reflects both personal preference and Hawaiis housing constraints.
Consequently, many Boomers remain in larger homes that may be bigger than they need.
Its worth noting that Boomers reluctance to sell en masse has buffered Hawaiis housing market.
In Hawaii, those fears have not materialized through 2023.
Instead, Boomers have largelyheld onto their homes, and housing turnover among that age group has been gradual.
In 20182023, new economic dynamics emerged.
Cost of living in Hawaii reached all-time highs, putting pressure on retirees on fixed incomes.
This surge gave equity-rich Boomers even more financial incentive to stay put and watch their asset appreciate.
Hawaii has the lowest property tax rates in the country (around 0.3% effective rate).
Low rates allowed some Boomers to refinance or purchase vacation condos with cheap financing.
Climate and Environmental Considerations
Hawaiis climate has long been one of its main draws for retirees.
Over 20182023, climate continued to be mostly a pull factor: a selling point for Hawaii living.
However, climateconcernshave increasingly come into play as well.
A 2018 study found over one-third of Hawaiis coastline is at risk as climate change accelerates.
Most Boomers in 20182023 did not move explicitly because of climate change projections.
Acute environmental events during 20182023 did influence some Boomer decisions.
Most recently, the 2023 Maui wildfires were a sobering reminder that even paradise isnt immune to disasters.
Tax Policies and Financial Considerations
Taxation is often a significant factor for retirees choosing where to live.
Hawaiis tax policies present an interesting mix of pros and cons for Baby Boomers.
On the plus side for Hawaii, the state offers generous exemptions on retirement income.
Hawaii does not tax Social Security benefits or public and private pension payouts.
Additionally, Hawaiis property taxes are extremely low for owner-occupants and seniors often get additional home exemptions.
Cohort Variations Within the Boomer Generation
Not all Baby Boomers behave the same.
Within this large cohort, there are meaningful differences between different subgroups:
Younger vs.
Many in this group only recently became empty nesters as their adult children moved out in the 2010s.
Younger Boomers have generally been moremobileandtransactionalin the housing market than their older counterparts.
Over 20182023, younger Boomers were the most likely within the 5977 age range to be buying homes.
Some of these purchases are second homes or investment properties, but many are relocations or retirement home purchases.
Younger Boomers are also more willing to make long-distance moves.
Younger Boomers are also more likely to carry a mortgage and trade homes.
Many took advantage of low interest rates pre-2022 to purchase new homes or refinance.
They generally exhibit moreconservativehousing behavior staying put or downsizingverylocally.
Native Hawaii Boomers tend to have strong family networks and emotional attachments to Hawaii.
Those who did are usually sitting on substantial home equity.
However, if their children permanently settle on the mainland, some local Boomers eventually choose to follow.
For local Boomers who stay, many live in multi-generational households.
Its a tradition in Hawaii for grandparents to live with their children and grandchildren.
Census data consistently show Hawaii leads the nation in multi-gen homes.
In contrast, Mainland transplant Boomers in Hawaii generally arrive with different motivations and circumstances.
Their housing choices skew toward resort areas, condominiums, or newer developments.
One notable pattern is thatmainland Boomer transplants often choose different locations than local Boomers.
The strong desire to age in place that was observed in surveys a decade ago has remained firm.
By 20182023, those same people are in their 60s/70s andstill in those homes.
Nationally, Boomers downsizing picked up post-2015 as the housing market improved.
In Hawaii, however, downsizing remained constrained by a lack of suitable inventory in both decades.
Migration Patterns
One big difference is Hawaiis overall migration trend.
From 20082018, Hawaiis population wasgrowingslightly (natural increase offsetting out-migration).
Housing Market Conditions
The 20082018 period began with a housing bust and ended with a boom.
Many Boomers held off making moves early on (20082012) due to negative equity or uncertainty.
Once conditions improved, they cautiously began to act around 20132018.
Boomers in Hawaii responded by mostly staying put during uncertainty (mirroring their behavior in 20082012).
Most instead used it as an opportunity to refinance or help their kids buy homes (tapping equity).
The consistent outcome in both decades is that Boomers emerged withmore housing wealth.
Boomers were important, but by the late 2010s, Boomers took the lead nationally in home purchases.
The current five-year spans challenges were the pandemic, rapid inflation, and climate events.
These introduced new considerations (health safety, remote lifestyle, etc.)
that werent present before.
