Senior Housing Trends – Where is the market going?
Where is the housing market going for our seniors? What are their options?
This is part of a continuing series of articles and tips into elder care and ideas on how to address topics such as downsizing, estate sale, content removal, home clean-out, property sale, moving and other real estate transition insights by Nick Santoro and Joe Santoro of Personal Property Managers (www.personalpropertymanagers.com). Personal Property Managers services Pennsylvania and New Jersey.
According to demographic researcher Arthur C. Nelson, aging baby boomers increasingly want to sell the large homes they bought to raise their families. This, in turn, could cause the next housing crisis later this decade.
But the single-family sector’s loss may be the multifamily industry’s gain, since many of those senior citizens are likely to downsize into newly constructed apartment communities – many of which emphasize multi-generational living.
Arthur Nelson, director of the Metropolitan Research Center at the University of Utah, calls the emerging trend “The Great Senior Sell-Off.” Nelson and Earl Blumenauer, in their book “Reshaping Metropolitan America: Development Trends and Opportunities to 2030,” say that by the end of this decade about 7% of seniors ages 65 and older will move each year. Furthermore, roughly 74% of new housing demand then could come from the current owners of the typical 1960s-1980s single-family homes: which are typically single family houses, many more than 2,500 square feet and some on large lots of at least a half-acre.
In an interview with “The Atlantic,” Nelson indicated that though the boomers hope subsequent generations will buy their homes, the demand might not be there as younger families choose condominiums or urban townhouses.
“That demand used to be almost zero percent (for condos and townhomes), and now its 25 percent,” Nelson told the Atlantic.
Nelson also said the growing population of lesser-educated minorities might cause an income gap that will further reduce the demand for the Boomers’ old homes. He blames the nation’s education system on this possible trend.
The next housing crash is predicted to take place around 2020 due to changing preferences and declining median household income due to unaffordable higher education, people just don’t have the money nor are they willing to spend it on education which may not produce the return on investment it once did.
But the seniors have to move somewhere if they’re able to sell their homes. That will likely be apartments.
“They’re going to rent,” Nelson told the “Chicago Tribune.” Some 80% of seniors age 65 are home owners, which is the highest of any age group. Currently, about 4% of senior homeowners move each year, and of this group, about 60% of them move into rentals of one kind or another.
It is predicted that two-thirds of all new housing demand between 2010 and 2030 will be for rental housing. An article in “Building Design and Construction” stated that 5% to 8% of those seniors will choose seniors-only facilities.
While the senior-housing market is building, another option is rapidly emerging: That of multi-generational communities, which serve everyone from millennials to baby boomers. These developments usually consist of several buildings, at least one of which is earmarked for seniors only. A common community area with dining facilities, recreation rooms, outside walking and sitting areas and, when climate allows, swimming pools allows all residents to intermingle.
And unlike many seniors-only facilities, children and younger adults can enter the senior building freely, allowing parents, their adult children and grandchildren to live separately, but very close if they desire.
In summary, while seniors might have trouble selling their homes at the end of this decade, the multifamily industry is providing some nice options once the “Sold” sign goes up.
For more information on the senior housing market or home downsizing please contact Nick Santoro or Joe Santoro of Personal Property Managers at www.personalpropertymanagers.com Personal Property Managers specializes in helping to transition elderly ones from their home of many years into senior care communities. Personal Property Managers services Pennsylvania and New Jersey and offers downsizing services, estate sales services, home staging, full service real estate home sale services.