As older generations (particularly baby boomers and the Silent Generation) retire or pass away, their assets and real estate are transferred to heirs, who are largely family members. According to a recent report from Cerulli, approximately $124 trillion will move from older generations to Gen Xers and millennials by 2048.
This means the United States will experience a historic intergenerational wealth transfer over the next two decades. Nicknamed the Great Wealth Transfer, or the Silver Tsunami, this phenomenon doesn’t necessarily mean heirs will finally be able to pay off their student debt or fund a down payment on a house.
Currently, most older people’s wealth is tied to real estate, with baby boomers owning the most property in the U.S. (41% in 2025), followed by Gen Xers (30%). While it is expected that $105 trillion will flow to heirs, more than 50% of the total transfer volume ($62 trillion) is expected to come from high- and ultra-high-net-worth households, which together account for only 2% of all households.
Underwood Law explains what this means for the economy in general and how this intergenerational wealth transfer impacts people’s lives.
The Silver Tsunami is Actually a Tide
Economists and headlines have long warned of a sudden crash in home prices caused by millions of Boomers dying or selling their homes simultaneously, flooding the market with inventory.
The data, however, suggests a more complex reality.
First, the intergenerational wealth transfer will occur gradually, acting more like a rising tide than a crashing wave. Over the next decade, most property and wealth owned by Boomers and older generations will move down to Gen X family members, who may not be interested in selling.
For those Boomer homes that will “flood” the market, they won’t crash prices. Given that we’re going through a period of historic inventory shortages, they might just be enough to meet the desperate pent-up demand from millennials and Gen Zers.
Additionally, people live longer nowadays. Boomers are between 61 and 79 years old, and with the average life expectancy in the U.S. being 78.4, there’s still a long way to go before all property owned by Boomers switches hands.
Source: Analyzing The Growing Role Of Real Estate In Intergenerational Wealth
Recent Comments