Did the Housing Boom Cause a Baby Boom?

The nation's recent housing bubble--which is now collapsing as a recession looms--may have had consequences beyond strictly financial ones. The 4,265,996 babies born in 2006--the most babies born in a year since 1961--may have been part of a baby boom brought on by the housing boom, according to an article in the New York Times.

"Social scientists have long traced a connection between housing and fertility," according to the New York Times, and some of these social scientists are theorizing that the housing bubble led to a mini baby boom.

"For the first time in 35 years, America’s total fertility rate—the estimated number of children a woman will have in her lifetime—reached 2.1, the theoretical level required to maintain the country’s population, according to recent data from the National Center for Health Statistics," the article said.

"In the wide-open mortgage climate early this decade, creative loan products allowed more people than ever to buy homes, often a precursor to having children," the article said. Once they owned homes, then, many probably felt they were stable and responsible financially. Owning a home also probably gave a lot of people the feeling that they had enough space to raise kids. And in 2006, the housing boom baby boom was born.

This mini baby boom could mean a lot of things. For one, the class of college students starting in the fall of 2024 is sure to be quite competitive.

In addition, this mini baby boom could be a boon to the original baby boomers who, in addition to having more grandchildren to spoil, now have a lot more people who could help pay for their retirement.

While the oldest of the original baby boomers can now collect Social Security and retire, the youngest baby boomers still have 21 years until they hit age 65--the traditional retirement age--and many people plan to work past age 65 in order to be able to sock away enough money to retire comfortably. Thus, these housing boom baby boomers will be in the work force early enough to contribute to Social Security in time for the original baby boomers to benefit.

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