If you think the sub-prime real estate fiasco is bad, just watch what the Baby Boomers have in store for us. At least, that's the upshot of a new report by the American Planning Association which concludes that retiring boomers will soon send shockwaves through our housing market.

To wit: 78 million American boomers will "retire, relocate and eventually withdraw from the housing market," according to report authors Dowell Myers, a professor of urban planning and demography in the School of Policy, Planning and Development at the University of Southern California, and SungHo Ryu, an associate planner with the Southern California Association of Governments.

The authors use demographic data to show that individuals in their mid-60s tend to sell more often than they buy, which means boomers are a "dominant force in the housing market." And, by 2011, a major market shift will occur, with some retirees looking to downsize, others relocating to warmer climes and others moving to nursing homes. As they phase out of the housing market or look to sell their homes, in some states there will be "more homes available for sale than there are buyers for them." As a result, home prices will soften.

There are states where this trend already is under way, the authors say, including Connecticut, Hawaii, New York, North Dakota, Pennsylvania and West Virginia. No mention of Washington as far as I can tell.

I was struck by what the authors recommend we do about this trend. They say metro areas need to limit overbuilding of new housing, put measures into place to retain the elderly in the community, and attract young households and immigrant households to local neighborhoods.

One thing Washington is doing well is limiting overbuilding. In fact, some economists credit the state's anti-sprawl Growth Management Act with lessening the impact of the cratering real estate market.

How will it play out when the retirement of the boomers begins to mix up the housing market? Time will tell. But I found this blog by the Wall Street Journal to contain a nice summary of the issue, as well as some interesting thoughts about the possibilities.