According to a report released by the online real estate brokerage Redfin in August, as of the first quarter of 2023, the total value of homes owned by the Baby Boomer generation is a staggering $18 trillion, while the Millennial generation holds only around $5 trillion. This extensive downsizing trend has been dubbed the "Silver Tsunami" by Bloomberg, with expectations for significant transformations in the real estate market starting from next year through 2025.

However, not all experts and economists agree with this prediction. They point out that while the competitive factors from the Baby Boomer generation might decrease, other factors could hinder the younger generation's ability to purchase homes, potentially extending this phenomenon for over a decade.

Additionally, as the Baby Boomer generation gradually enters retirement age, their loan amounts are lower, meaning that fluctuations in interest rates may not significantly impact their purchasing decisions. Therefore, even if the "Silver Tsunami" were to materialize, there might not be many young buyers capable of affording homes.

Furthermore, while the "Silver Tsunami" could release a substantial number of housing resources, it does not address the affordability challenge for the younger generation. A report from RentCafe revealed that high housing prices still lead 20% of Millennials and 68% of Generation Z to live with family; approximately one-third of Millennials expressed plans to continue living with their parents for at least two to five more years.

Moreover, even if the younger generation saves some money by living with their parents, they still cannot afford the soaring home prices.

Reports indicate that most Millennials living with family households typically have three to four occupants and often work in lower-paying sectors such as food service, construction, or education.

A study by Redfin indicated that out of every five members of Generation Z and Millennials planning to buy homes next year, two are involved in side jobs to save for the down payment. Additionally, some Millennials are even asking wedding guests for cash gifts to assist with their home purchase down payment.

While the "Silver Tsunami" might alter the supply-demand dynamics of the housing market, it does not address the fundamental issue of whether the younger generation has the financial capability to purchase homes. Another complicating factor is that some Baby Boomers are looking to downsize and move into retirement communities, targeting the same smaller homes that the younger generation desires for their first home purchase.

This will continue to push Millennials and Generation Z out of the housing market and further drive up the prices of smaller homes, as the ultimate winners are the Baby Boomers with the most cash on hand.

Given this scenario, some economists believe that a large-scale downsizing wave may not occur in the next one or two years. Chief Economist at Fortune 500 financial services company First American, Fleming, suggests that this implies many Millennials may miss the opportunity of a housing price downturn caused by the "Silver Tsunami."

While the "Silver Tsunami" could alter the supply-demand dynamics of the housing market, it does not solve the complex issues facing the entire real estate market.