Surprisingly, Builders Confident about 55+ Market
Category: Retirement Real Estate
Oct. 29, 2020 – Builder confidence in the single-family 55+ housing market was at an all-time high in the third quarter, jumping 18 points to 83, according to the National Association of Home Builders’ (NAHB) 55+ Housing Market Index (HMI) released today.
The 55+ HMI measures two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each segment of the 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic).
“We saw 55+ buyers come out in force in the third quarter of this year, driving strong growth in sales at 55+ communities,” said Harry Miller III, chairman of NAHB’s 55+ Housing Industry Council and president of Regal Builders LLC in Dover, Del. “However, shortages of key building materials are contributing to affordability concerns and delayed construction schedules, although recent declines in lumber prices offer good news.”
All three index components of the 55+ single-family HMI posted gains in the third quarter and were all-time highs: present sales increased 16 points to 88, expected sales for the next six months rose 20 points to 90 and traffic of prospective buyers jumped 23 points to 69.
The 55+ multifamily condo HMI increased 20 points to 67-a record level. All three index components also posted increases from the previous quarter: present sales rose 20 points to 70, expected sales for the next six months increased 15 points to 67 and traffic of prospective buyers jumped 24 points to 63. All four components of the 55+ multifamily rental market went up in the third quarter as well.
“Like the broader housing market, low interest rates and the importance of home are helping to lift market sentiment,” said NAHB Chief Economist Robert Dietz. “The rebound in the stock market has also contributed to demand for the 55+ housing market.”
Comments? Have you been out actively looking for your place to retire? Have you been couch-surfing 55+ places, or are you so paralyzed by fears of the pandemic you just don’t know what to do? Please share your thoughts and experiences in the Comments below.
Comments on "Surprisingly, Builders Confident about 55+ Market"
Fionna says:
I hope that the interest in 55+ housing continues since we will be putting our home up for sale soon. Resales here in the Charleston area of SC seem pretty good as some buyers prefer existing homes vs. going through the hassle of building. There's always weather delays and waiting for subcontractors to come back and make things right as well as unexpected '"surprises" you didn't anticipate!
Larry says:
Does the 55+ designation mean age-restricted communities or the entire over-55 market? Regardless, the report comports with what I am hearing from the real estate professionals I work with in the Southeast. Two examples: Palmetto Bluff, a high-end community in Bluffton, SC, had 47 pending sales (homes and homesites) this week; at the same time last year, the number was zero. At the much more modestly priced Keowee Key on Lake Keowee in SC, normal inventory of homes for sale is around 100; yesterday it was 4. Prices are rising accordingly as supplies shrink and demand rises. So, Fionna, you are indeed in luck unless, of course, you plan to buy another place in the Sunbelt.
Bruce says:
In our 55 community which is a 1/3 build out, the four home builders here now state it will take a year for your home to be build instead of the 6-9 months last year. This is due to a few shortages because of covid but also their contractors back log. The ready to move in homes have been all sold quickly. Strong market in our community.
Jemmie says:
Not looking to move to a 55+ community right now but I am surprised how many new communities I see springing up around Cleveland, Ohio. Some are 55+, some all ages and a couple of assisted living, but it appears they are putting in these new communities on small parcels of land, so none are very big and doesn't look like they offer any amenities, which maybe is what some 55+ want to help keep the expenses down, but not sure what the draw is in that case.