While millennials have gotten a lot of attention lately as the generation whose below-normal homeownership rates are changing the landscape of the U.S. real estate market, the boomerang buyers — who are primarily Generation Xers or Baby Boomers — represent a massive wave of potential pent-up demand that could shape the housing market in the short term even more dramatically. U.S. Census data shows home ownership rates for those ages 35 to 44 — roughly Generation X — were 11 percent below historical averages going back to 1994 in the third quarter of 2013, while home ownership rates for the below age 35 cohort were 10 percent below historical averages.

RealtyTrac analyzed foreclosure, affordability and demographic data to provide predictions of when and where these boomerang buyers are most likely to materialize. Nearly 7.3 million potential boomerang buyers nationwide will be in a position to buy again from a credit repair perspective over the next eight years. Here’s how those emerging boomerang buyers break down by year.

Markets with the most potential boomerang buyers over the next eight years among metropolitan statistical areas with a population of at least 250,000 were not surprisingly in some of the nation’s largest markets that were also hardest hit by the housing crisis. These are primarily in the Sun Belt and Rust Belt.

Markets with Highest Share of Potential Boomerang Buyers

A similar set of markets show up in the list of those with the highest rate of potential boomerang buyers as a percentage of total housing units, with markets that were once epicenters of the foreclosure problem showing up in the top five.

Markets Where Boomerang Buyers Most Likely to Materialize

Markets most likely to see the boomerang buyers materialize are those where there are a high percentage of housing units lost to foreclosure but where current home prices are still affordable for median income earners and where the population of Gen Xers and Baby Boomers — the two generations most likely to be boomerang buyers — have held steady or increased during the Great Recession.

There were 22 metros among those with at least 250,000 people where this trifecta of market conditions is in place, making these metros the most likely nationwide to see a large number of boomerang buyers materialize in 2015 and beyond. For all the markets on this list potential boomerang buyers represent at least 5 percent of all housing units, house payments on a median priced home require 28 percent or less of the median household income, and the population of Gen Xers and Baby Boomers combined has stayed steady or increased between 2007 and 2013.

Methodology: The Millennial generation is defined as someone who was born between the years 1977 to 1992. In 2013 Millennials would have been between the ages of 21 to 36. In 2007 the Millennial generation was between the ages of 15 to 30. The Generation X generation is defined as someone who was born between the years 1965 to 1976. In 2013 Generation Xers would have been between the ages of 37 to 48. In 2007 Generation Xers were between the ages of 31 to 42. The Baby Boomer generation is defined as someone who was born between the years 1945 to 1964. In 2013 Baby Boomers would have been between the ages of 49 to 68. In 2007 Baby Boomers were between the ages of 43 to 62.

http://www.realtytrac.com/news/foreclosure-trends/boomerang-buyers/