Location, Population and Projection

by Jim Stakem 2/22/2010

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There has been a simple, easy to follow “rule” for my entire Real Estate career, Location Location Location! It is an easy way to emphasize that the single most important consideration is location. This has been true and will be more so in the future, however things are no longer as they were in the past. We have benefited from a massive movement of “Baby Boomers” for the last 60 years. They have affected everything in this country as they have advanced through the years but nothing more than our housing trends beginning in the mid 1960s as they became adults. Initially came the starter homes in places like Levittown, Bowie, Silver Spring, Arlington, Alexandria, Annandale and 1000s more across the US. Then along came the move ups, vacation homes and finally the “McMansions”, they were on a role!

So what is going to be important now? Location will always be a prime consideration, but we will have to add to that the current population, what age group they are in and what the projection is for that area. Some areas are much more top heavy in “Boomers” than other areas. Most of these people will retire in place and this will seriously change the nature of the neighborhood. In the past only 65% retired in place, now I would guess that number will increase to about 85%. The continuing recession has seriously eroded their ability to move and they have no prospect of replacing that loss of equity and income. Other areas have very strong employment trends, Northern Va. for example, and others like Detroit have to re-invent themselves. You can drill down in your local area and actually make a pretty accurate assessment yourself. It will be vitally important that you consider the population and employment trends in your decision to buy or sell. Although a home is not really an “investment” it can become a valuable asset if you make the right decision.

I will be comparing Fairfax and Loudoun in my next article. There will be some surprises!