A significant portion of the baby boomer generation, which drove economic growth, is struggling with housing costs, becoming “house poor,” according to reports.
On May 26, the U.S. Census Bureau reported that the baby boomer generation, born between 1946 and 1964 and numbering approximately 76.4 million, is facing difficulties with mortgage payments. Having largely retired, many in this group are burdened by substantial housing expenses.

The general rule is that housing costs should not exceed 30% of income. However, some baby boomers who have become house poor are struggling to cover mortgage payments, property taxes, maintenance, utilities, and homeowners’ insurance. Excessive housing costs are hindering their retirement.
Representing about 20% of the population and historically the largest consumer group, baby boomers have driven rapid domestic market growth. So why are they facing these challenges? Experts point to four main reasons: ▲ emotional attachment to large homes, ▲ increased debt from repeated refinancing, ▲ lack of supplemental income, and ▲ depletion of retirement savings.

Shane Atkins, a financial expert at Broadway Graham Wells Partners, explained, “Baby boomers, having witnessed years of rising home values, develop a strong attachment to their homes. They often resist downsizing or moving, as they see it as losing their identity or leaving no legacy for their children.”
Yahoo Finance advised, “If children have moved out, consider relocating to a smaller home. Finding a balance where you utilize necessary space without being overly burdened by maintenance and costs is key.”
The second reason is that baby boomers have increased debt by refinancing mortgages instead of paying them off. Sebastian Jania, director of Ontario Property Buyers, noted, “Over the decades, I’ve seen many homeowners who, instead of paying off their mortgages, refinanced and took on more debt. Had they avoided additional borrowing, they could have paid off their loans and had more disposable income for retirement.”
The third reason some baby boomers have become house poor is their failure to capitalize on opportunities to generate supplemental income, such as renting out parts of their homes. Jania said, “One way to turn a home into an asset is to rent out a bedroom or separate space to generate more income.” Yahoo Finance emphasized, “Having enjoyed their entire home for themselves and their families, baby boomers should seriously consider renting out part of their home to help cover mortgage payments.”
The fourth reason, according to experts, is that baby boomers are continuously withdrawing retirement savings to cover mortgage payments.

Aaron Gordon, senior mortgage loan officer at Guild Mortgage, warned, “You shouldn’t keep dipping into retirement savings to maintain your home. Market volatility or inflation could deplete savings faster than expected.” He added, “Baby boomers need to purchase affordable homes suited to the current economy, especially during retirement when income decreases. Housing costs must be manageable both now and in the future.”
Gordon concluded, “In severe cases, a ‘reverse mortgage’ could be considered.” A reverse mortgage, available to those 62 and older, allows homeowners to borrow against their home’s value to pay off existing loans or cover living expenses.

By Hong-Yong Park