Wise real estate agents are setting aside old-fashioned stereotypes about seniors moving to Florida and playing shuffleboard or bingo. Today’s seniors are more active than ever and remain a major factor in economic growth. In fact, contrary to popular assumptions, studies show Americans age 65-74 lead the country in new household formation.
In a recent article on the National Association of Realtors® Economist Outlook Blog, George Raitu reported that the top three age groups forming new households in the first half of 2015 were those aged 55 and over.
This surprising revelation will affect the market that normally anticipates household formation to be led by younger families.
With 65-74 year olds becoming the fastest growing-segment of the population, they remain poised to impact real estate business for the next two decades. What can agents do to make sure they are ready to reach this growing demographic?
Seniors are more active than ever
First, real estate professionals must adopt a “50 is the new 30” understanding. Baby boomers took a huge hit in the 2008 financial crisis. While on the one hand this means they have a reduced net worth, it also means they will be working longer and have adjusted lifestyle expectations.
Boomers have modified their plans to include extended careers, new relationships, and the accompanying new homes that go with them. Today’s baby boomers are more growth-minded than seniors were a generation ago.
Second, agents can assume seniors will shop differently than in the past. While they will look for properties that are easier to maintain and still prefer single level homes, baby boomers are less concerned with age friendly features than they were 10 years ago. More likely, they will want upgraded kitchens and bathrooms. Nearly half of seniors are trending away from traditional downsizing and actually shopping for larger homes. Those who do downsize may be interested in making major improvements to the property they acquire.
Third, these changes will affect the housing related economy in a broad way. New housing developers who have focused on building neighborhoods for young families will incorporate the needs of older buyers into their planning and mortgage companies will be issuing more new loans to people over age 50. Seniors will gravitate away from retirement communities and seek out mainstream housing to stay in as they age. This will lead to new business for service industry professionals and home health providers.
Real estate agents can consider the strength of these services in a community as potential selling points for clients over age 50.
The key takeaway, folks
The baby boomer generation is redefining the way Americans think about aging. They are keeping jobs, getting married, forming households, and looking to move up in the housing market the same way thirtysomethings have in the past. That’s encouraging for everyone growing older and it’s an encouragement for real estate pros to keep an eye on this fast moving segment.