Gray by 2040: Aging population and renters will dominate market trends

Move over millennials. Aging boomers will be among the next population wave to hit Detroit, according to a new report by the Washington, D.C.-based Urban Institute which reports that “gray” will become the new currency over the next 30 years.

Both the city and Southeastern Michigan will experience a population surge, data from “Southeast Michigan Housing Futures” shows. Additionally, the entire southeast region of the state will gain 380,000 households between 2010 and 2040.

“Community-based organizations must play a pivotal role in helping families transition from being renters to homeowners.”

“Southeast Michigan Housing Futures” contradicts the reality that Detroit has been losing residents since the 1950s, and that most of the region’s growth has been in suburban areas. But events like the relocation of the city’s largest employer, Quicken Loans, to downtown and the federal government’s substantial economic investments in Detroit have contributed to a reversal of the population trend.

Mark Treskon, lead author of the report, adds, while the region will experience a population boom, there are challenges it must face.

The major issues anticipated to dominate include a:

Seismic increase in senior-headed households
Decline in African American home ownership
Surge in demand for rental housing

These challenges are not unique to Detroit. Cities across America must now find new ways to address transportation, health care, banking, shopping and housing needs associated with the population shirts.

Civic and industry leaders need to work together to forge solutions to these upcoming obstacles, Treskon adds.

“Given that these are regional challenges, state and local officials, civic and financial leaders, nonprofit and community advocates could benefit from sharing information and exploring coordinated and collective responses,” Treskon says.

*Yes, Michigan will be graying substantially by 2040, according to the Southeast Michigan Housing Futures study. Chart by Urban Institute*

Researchers from the Institute say senior-headed households will double between 2010 and 2040, so officials and stakeholders will have to develop policies to respond to the needs of the population. Transportation options for many seniors, who have driving limitations, along with long-term care programs and ways to reduce their costs will have to be addressed, data shows.

Treskon notes that housing and lending industries need to find ways to help African American families get on the path to home ownership, and continue recovering from the past decade’s foreclosure crisis. In addition, community-based organizations must play a pivotal role in helping these families transition from being renters to homeowners, he says.

With a greater population in the southeast region of the state, there will also be a strong need for high-quality, affordable and safe rental housing. “Southeast Michigan Housing Futures” shows that many households in the region prefer long-term rental housing over home ownership.