Options Aplenty for 50-Plus Homebuyers
Thanks to demographics and their market clout, homebuyers age 50 and above have an exciting array of options to consider in today's real estate market. Today over half of all U.S. heads-of-households are over 50 years of age, and own over 75% of America's financial assets, 80% of the savings, and over 50% of all corporate stocks. It's not surprising that the marketplace is listening, and responding, to the needs of the 50-plus homebuyer1.
Time to Make a Move?
The motivations of 50-plus homebuyers to seek a new home are many, including:
- Downsizing to a home that is easier to maintain
- Desire for a more active lifestyle; proximity to sports, dining, cultural activities, etc.
- Convenient access to amenities such as healthcare, libraries, shopping, etc., on foot or via public transportation
- A need or wish to move closer to family and friends
- Purchase of a vacation getaway or second home
- Concerns about health issues
Any of the above reasons about moving can spark a potential buyer to begin a search for their next home. Let's take a closer look at some of the more common reasons that people 50-plus seek a new home.
1 = Source: TeamERA.com "New Thresholds"
The decision to downsize – to move to a smaller, more manageable home – can mark the beginning of a new, liberated chapter in one's life. In many cases, children have grown and "left the nest," just at the time when many people are seeking to spend less time on home maintenance and repair, and more time to pursue their next career, take up a new hobby or expand their social circle.
For long-time homeowners, downsizing can be an emotional time as well, a time for leaving familiar surroundings and exploring new possibilities.
When should one consider downsizing? Real estate website Realtor.org suggests that a homeowner is a candidate for downsizing if they can answer "yes" to any of the following:
- Does my home no longer provide the best environment for my physical needs?
- Has my social life been negatively affected by the condition of my home?
- Do I have trouble finding workers to maintain my home?
- Are financial considerations keeping me from enjoying my home?
- Do I feel I have adequate security, and access to care and other amenities in my current home?
Steps to Downsizing Successfully
Once the decision to downsize has been made, some important considerations include:
- Choosing a community
- Deciding on the type and size of home (e.g. detached single-family, condo, etc.)
- Preparing the current home for sale
- Resizing the contents of the current household to fit the new home
- Planning and coordinating the move
A trusted ERA Real Estate affiliated sales professional has the training and experience to assist with any and all concerns about downsizing.
Moving Closer to Family May be the Right Move
According to a study by the National Association of Home Builders (www.nahb.org) and the MetLife Mature Market Institute (www.metlife.com/mmi), a common reason that people age 55-plus move is to be closer to family and friends. About 40% of people in this group moved into age-restricted active-adult communities for this reason, as did over 30% of people who chose other 55-plus owner-occupied communities.
A chief motivator cited by analysts is the desire to be in a more effective caregiver relationship for a parent or other loved one.
Other findings of the study included:
- Only about 3% of 55-plus households lived in age-restrictive or age-qualified communities in 2007, an increase of 2.2% from 2001.
- Residents of age-restricted active-adult communities expressed the highest rate of satisfaction with living in their current home.
- Many baby boomers near the traditional retirement age of 65 reported that they are delaying retirement; those contemplating a move often seek a community that's either nearer to work or would be suitable for working from home.
If you're considering moving closer to your family, talk to an ERA Real Estate affiliated sales professional. With a world-wide network and over three million listings on ERA.com, you'll soon discover why ERA Real Estate is Always There For You®.
Consider a Second Home
Homebuyers age 55-plus with a long-term view who are willing to work a bit harder to secure financing may decide that now is a good time to consider the purchase of a second home. In spite of a current dip in second home purchases and prices, the National Association of Realtors ( www.realtor.org ) foresees favorable long-term demand.
The primary reason for optimism is demographics – NAR reports that there are currently over 39 million people in the US age 50-59, nearly 45 million people are between ages 40-49 and nearly 41 million ages 30-39. Many of these people will be in the market for second homes over the next decades.
According to NAR, the single most important factor in the decision to purchase a second home is lifestyle, versus investment or the desire for rental income. Whether it's a weekend getaway or a warm place to spend the winter season, second homes are primarily being purchased for use by the buyers or as a family getaway.
When it comes to financing a vacation home, cash deals play a significant role. NAR reports that over four in 10 investment buyers and over three in 10 vacation home buyers paid cash for their properties. NAR also reports that affordability of vacation homes has increased, with the median price of a vacation home in 2008 down 23.1% from the prior year.
When choosing the location of a second home, NAR reports that over 25% were purchased in small towns, 23% in rural areas, 23% in a resort, 20% in a suburb and less than 10% in an urban area.
Given current market conditions, it's important to work with a real estate professional who understands the local market and has access to knowledgeable resources who can help buyers with financing and other issues.
Active Adult Communities offer Advantages
For 55-plus buyers who seek many of the recreational and cultural plusses of a resort coupled with the opportunity to live in a community of their peers, a home in an "active adult" or "retirement living" community is well worth considering.
Speak to a real estate professional about such communities if your housing and lifestyle goals include:
- Active involvement in an intellectually and culturally diverse community
- A home that's virtually maintenance-free
- Opportunities to participate in both organized and free-form activities
- Organized wellness programs and nutritional guidance
- Convenient access to shopping and other conveniences
Advance Planning is a Must
Active adult and retirement communities at a wide range of price points serve this growing market segment. Amenities range from modest to luxuriously lavish, and the choices are far too numerous to list. To help make the process of choosing a community an exciting and successful one:
- Make a "wish list" of desired activities, amenities and social expectations
- Choose the geographic area(s) that are most appealing
- Use the Web and your local library as a research tools
- Work with a trusted real estate professional
- Thoroughly investigate any community before making a decision
Independent and Assisted Living Options are Expanding
Thanks to the growing demand for housing for the entire spectrum of adult homebuyers, 55-plus homebuyers in need of a home designed for easy access or a planned community with some degree of access to medical care are almost certain to find a living situation that meets their needs.
Here's a sampling of available options:
Independent Living: These communities are for individuals who do not require medical care, yet want to live in a community designed with easy access and safety in mind. Independent living facilities are great places to meet people with similar interests and participate in an extensive schedule of recreational and wellness programs, and other planned activities. Living arrangements often include kitchens, and the option of restaurant-style dining.
Assisted Living: Designed for people who do not wish to live on their own and do not require round-the-clock care, assisted living facilities are staffed by trained professionals who can help residents when needed. An extensive schedule of planned on-site activities and off-site excursions are typically a feature of these facilities.
Nursing Homes: For people who require round-the-clock care, nursing homes are staffed with medical professionals trained to administer specialized care when needed. Staff members are trained to help residents with routine personal and medical needs. The quality of meal plans, medical, laundry and housekeeping services, religious services, and the schedule of recreational activities are some of the features to consider when choosing a nursing home.
Spotlight on Continuing Care Communities
Housing options for the 55-plus homebuyer continue to evolve. One "hybrid" trend that's appearing in more and more places is the continuing care retirement community, a combination of housing options ranging from independent living through increasing levels of care, all in one location. Residents can move from one type of housing to another as their needs change, without leaving their community.
As with all of the housing options above, living arrangements and amenities at continuing care communities range from modest to luxurious. Talk to an ERA Real Estate affiliated sales professional about the available options in your area.