By Wendy A. Jordan
Washington, March 9, 2006—"Like a pig through a python," the huge baby boom population is moving through the economy, forcing a lot of changes in the housing market. So says David Seiders, chief economist at the National Association of Home Builders, describing the unprecedented influence of the "flood of people" born between 1946 and 1964. The leading edge of this population bulge turns 60 this year, and another 10,000 people are turning 55 every day. "Look for very strong population growth in the 55-64 age range in the next 10 years," he says—and a reshaping of American housing to appeal to them.
Around 81 percent of boomers, the highest proportion of any age group in the United States, own homes now and they have "a strong preference for homeownership" as they move into different housing, says Seiders. They've got the cash too: Boomers control 75 percent of the nation's wealth, says Norman Cohen, a principal at Camelot/Signature development, Marietta, Ga. He adds that as they sell their old houses, often trading down, they bring cash to pay for quality new homes.
Boomer Central
Seiders and Cohen spoke to the media in a teleconference Tuesday to discuss the effect of boomers on housing.The opportunity to tap into the mammoth boomer market is not lost on builders. Cohen says builder membership in NAHB's 50 + Housing Council, which he chairs, has risen 32 percent in the last three years. "More builders are looking at this as part of their general housing program," even if they are not building 55 + communities, he says.
But those communities are popular and becoming more so. Six years ago, age-based communities had "a somewhat negative connotation," Cohen says. Today they are a positive for boomers who like the idea of "being in a community with people like themselves."
There are basically two types of communities for 55 + buyers: those restricted to residents in this age bracket, and those designed for 55 + homeowners but not restricted to them. Some are large master plan communities; others, such as those Cohen builds, occupy small "suburban infill" lots with 5 or 6 homes to an acre. In fact, Cohen says Cobb County, in the Atlanta area, welcomes these developments; it has a new zoning category for 50+ housing and a new law exempting homeowners aged 60+ from having to pay school taxes.
According to the 2003 American Housing Survey, a homeowner survey conducted every other year by the U.S. Census Bureau, 55 + housing represents 6 percent of total housing starts in the U.S. (about 3 percent for each type). "That's a sizeable number," says Seiders, and 55 + housing "will grow in importance over time as the population ages."
What 55 + Buyers Want
As with all homebuyers, location is a key factor in boomers' choice of new homes. "Most want to stay pretty darn close to where they've been," says Seiders. Many look for houses "within five miles of their current home or their family and grandkids," says Cohen. Other "destination buyers," want to resettle in attractive vacation spots. Boomers are not really looking to move, he adds. They are looking to change their lifestyle. They want
"lock it and leave it" homes, says Cohen, where the lawn care, gutter and window cleaning are taken care of. They like other extras, too:
- Community amenities. Large communities might include a pool, health center, and clubhouse/recreation complex.
- Gated communities. The appeal here, however, is more for the prestige than the security, says Cohen.
- Upgrades and customization. Boomers "are used to getting what they want when they want it, and they want lots of upgrades and options," says Cohen. "We have 300-400 pre-priced extras, and get requests daily for others as well." Popular upgrades, are hardwood floors, luxury carpeting, granite counters, stainless steel appliances, fancy cabinets and faucets, and screen-enclosed porches. On request he will make minor changes to his standard floor plans, such as converting a second bedroom to a den that opens to the living room instead of the hall.
- "Common sense features.". Cohen says that such features enable homeowners to age in place, and most don't cost much. They include wider hallways and doorways, an entrance with no steps, lever handles, rocker light switches, and backing behind bathroom walls to support grab bars.
- Floor plans that are comfortable for everyday living plus entertaining. Cohen's houses include a main-floor master bedroom, a guest bedroom separated from the master, a sunroom or patio, and an eating bar in the kitchen. Another must: A dining room big enough for "a couple of pieces of major furniture." boomers may get rid of a lot of things when they move, but to make the new place feel like home "they want to keep their bedroom and dining room furniture," Cohen says.
A Washington, D.C.-based writer and editor with expertise in residential remodeling and home building, Wendy A. Jordan is the author or co-author of nine books. She is the former executive editor of Builder magazine, founding editor of Remodeling magazine and the recipient of seven coveted Jesse H. Neal Editorial Achievement awards and Neal certificates of merit from the American Business Media.
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