Baby Boomers and seniors in the United States are taking a more pragmatic approach to their housing choices as an effect of the economic downturn according to a new study released today. A joint study by the 50+ Housing Council of the National Association of Home Builders (NAHB) and the MetLife Mature Market Institute reveals that home design considerations have taken a back seat as financial matters have been more prominent in home purchase process for 55+ buyers.
The new study, "Housing Trends Update for the 55+ Market,", explores households living in active adult communities, either age-qualified active adult communities where at least one resident must be age 55+, other non-age-qualified 55+ owner-occupied communities (not explicitly restricted to 55+ households but nevertheless occupied primarily by people age 55+), or age-restricted rental communities.
"By the year 2020, as Baby Boomers move into this age bracket, almost 45 percent of all U.S. households will include someone at least 55 years old," said David Crowe, NAHB’s chief economist. "The number of those households seeking housing better suited to their changing needs will therefore rise dramatically."
NAHB predicts that 54,000 housing starts are projected in 55+ communities this year, a 30 percent rise from estimated 2010 levels and that number is expected to increase another 46 percent to roughly 79,000 housing units in 2012. The average price of homes in the active adult segment were $319,000 in 2010 with buyers having an average income of more than $80,000 per year.
The survey finds that 55% of new age-restricted adult home buyers used the proceeds from the sale of their previous home as down payment where 45% used cash or savings as their down payment on their new home in 2009. This represents a significant change in prior years when over 90% of buyers in 2005 and 2007 used proceeds from the sale of their homes for down payments. The survey still finds that seniors want to be close to friends and family as well close to work.
Click here for the "Housing Trends Update for the 55+ Market"