Many boomers are now empty nesters and approaching retirement. Generally this means that they will downsize their housing in the near future. Boomers want to live in a walkable urban downtown, a suburban town center or a small town, according to a recent survey by the National Association of Realtors.And, in fact, teenagers are driving less:
The millennials are just now beginning to emerge from the nest — at least those who can afford to live on their own. This coming-of-age cohort also favors urban downtowns and suburban town centers — for lifestyle reasons and the convenience of not having to own cars.
Over all, only 12 percent of future homebuyers want the drivable suburban-fringe houses that are in such oversupply, according to the Realtors survey. This lack of demand all but guarantees continued price declines. Boomers selling their fringe housing will only add to the glut. Nothing the federal government can do will reverse this.
Many drivable-fringe house prices are now below replacement value, meaning the land under the house has no value and the sticks and bricks are worth less than they would cost to replace. This means there is no financial incentive to maintain the house; the next dollar invested will not be recouped upon resale. Many of these houses will be converted to rentals, which are rarely as well maintained as owner-occupied housing. Add the fact that the houses were built with cheap materials and methods to begin with, and you see why many fringe suburbs are turning into slums, with abandoned housing and rising crime.
But with money tight in many households, and the cost of gas and insurance soaring, some youngsters are having to choose between buying a car and owning the latest smartphone or tablet.
In a survey to be published later this year by Gartner, 46% of 18 to 24-year-olds said they would choose internet access over owning their own car. The figure is 15% among the baby boom generation, the people that grew up in the 1950s and 60s - seen as the golden age of American motoring.
Wally Neil, a 25-year-old wholefood salesman, from Raleigh North Carolina, was determined to stand out from the crowd by not getting a driving licence and a car as soon as he was old enough.
But it was a decision made easier by the fact that he could speak to his friends online and play games with them over the internet so did not feel he was missing out.
"We were all pretty closely connected, even before Facebook.
"So we were not driving to our friends' houses, there was the gaming network and all that. We were putting the car on the back burner.
"There is a lot to be said for the video game killing the need for a car for a lot of kids."
For Wally, whose father Dan is a motoring writer and sports car enthusiast, walking everywhere or taking the bus when he was a teenager, rather than learning to drive, was "an act of rebellion".
But he still had to put up with the taunts of his friends, he says, who could not wait to get behind the wheel and thought public transport was "for losers".
"I was ridiculed a little bit in my peer group but I was also saving a lot of money at the time."
There is no question that fewer teenagers are on the roads in the US.
In 1978, 50% of 16-year-olds had obtained their first driving licence. In 2008, according to the US Transportation Department, it was just 30%.
The number of those aged 19 and under with driving licences has also been in steady decline since its 1978 peak, when 11,989,000 had one. In 2010, it was 9,932,441, or 4.1% of American drivers.
So the next generation seems to be much less obsessed with car ownership and suburban living. What happens when they become the majority as Baby Boomers die off? There is change in the air...