Baby Boomers Finding it Easier to Sell Their Homes: Builder Confidence in 55+ Market Highest Since 2008
Category: Retirement Real Estate
WASHINGTON, May 8 – Builder confidence in the single-family 55+ housing market for the first quarter of 2014 reached the highest first-quarter reading since the inception of the index in 2008. That’s according to the National Association of Home Builders’ (NAHB) latest 55+ Housing Market Index (HMI). Compared to the first quarter of 2013, the single-family index increased 4 points to a level of 50, which is and the 10th consecutive quarter of year over year improvements.
Good news from baby boomers fueling the market
“There are many factors contributing to the positive signs in the 55+ housing market,” said Steve Bomberger, chairman of NAHB’s 50+ Housing Council and president of Benchmark Builders Inc. in Wilmington, Del. “Rising house prices and low interest rates are helping baby boomers sell their existing homes at a favorable price and in turn, purchase a new home more suited to their current lifestyles.”
There are separate 55+ HMIs for two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each 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). An index number below 50 indicates that more builders view conditions as poor than good.
Two of the components of the 55+ single-family HMI posted increases from a year ago: present sales rose six points to 52 and expected sales for the next six months climbed nine points to 62. Meanwhile, traffic of prospective buyers held steady at a reading of 41.
The 55+ multifamily condo HMI increased one point to 39, which is the highest first-quarter reading since the inception of the index. Two of the 55+ multifamily condo HMI components showed increases compared to a year ago: present sales increased four points to 41 and expected sales for the next six months rose five points to 48. Traffic of prospective buyers, however, decreased six points to 32.
“The 55+ segment of the housing market is stronger now than it was a year ago,” said NAHB Chief Economist David Crowe, “helped by factors like rising house prices, which has increased owners’ equity and allowed them to buy in a 55+ community. But there are still some headwinds hampering a stronger recovery, as builders in many markets are facing tight credit conditions and a lack of lots and labor.” You can see all of the tables at www.nahb.com
Comments: Are you seeing a stronger market for selling your home, and also in the new 55+ homes you might be looking at? Please share your thoughts in the Comments section below.
Comments on "Baby Boomers Finding it Easier to Sell Their Homes: Builder Confidence in 55+ Market Highest Since 2008"
dachsie says:
Home prices have recovered in the SF Bay Area and since there is still little/no new home building, a "Seller's Market" is back as well. Multiple offers above asking price and homes in my neighborhood are 'gone' within 48 hours of listing. I worry about another bubble. 55+ homes in Bay Area have gone up as well, while those I have seen outside SF Bay have not appreciated as much, but nonetheless are in recovery mode. Still can get some "deals" outside the Bay Area, but 'deal' is a relative term here in the Golden State.
Robert says:
dachsie, depending on who you listen to the reports that I read all indicate another housing bubble is "on it's way". Time will tell and "the one thing we learn from history is that we never learn from history"!!!!!!!!
Carole says:
In the central MA area, we're not experiencing a dramatic recovery. I currently live in a 55+ community. In the last 6 years there have been three short sales. The unit next to mine is currently on the market (not a short sale) for $285,000 down from a purchase price of $330,000 in 2007. A recent open house only enticed two couples to attend. I'd like to think we could move from here and head south in a couple of years but, unless there's a marked increase in value, we may be here to stay for the long term. Renting for 1-3 months in the winter may be the only option for us.
Ted says:
Just sold my house in Western PA in 4 days, for 105% of asking price. It went on line at midnight, and there were showings every hour starting at 10:00 am the next day. I had never heard of acceleration riders (buyer offering $1,000 more than the next highest price up to a specific amount) until offers started coming in with them. It was a crazy few days, and very unexpected. I'm obviously grateful my house hit our local market at the right time.
Paula says:
Ted, where in western PA was your house? It's all location, location, location... and where are you heading? What are your reasons for leaving western PA? We live in the Finger Lakes region of NY -- and even though we like a lot of things here (except winter and continual gray skies), we're not sure we can afford NY's incredible tax burden (and other high COL). PA is one option we're considering -- and where depends all on local property tax load, which can vary tremendously across the state.
glenns says:
We've been in the real estate market (owner occupied) since 1986. We've had to sell our homes, due to work, about 4 times. Fortunately we have not had to sell in a 'down' market (sold in '89, '03, '07 and now '14).
I've learned that the only thing certain in real estate is that it'll go up and it'll go down.
Ted says:
I was in a suburb of Pittsburgh. Really like Western PA, although real estate taxes are high (set off by reasonable utility bills, lower home insurance, no sales tax on food, clothing or meds, no income tax on my 401K withdrawal, no personal property tax on my cars, etc.). The biggest negatives in my mind are high real estate taxes, there are few neighborhoods where you aren't dependent on a car, and there isn't enough senior housing. Perhaps because of the hills, it can be very hard to find ranch homes that are in good shape. There are few reasonable 55+ communities, condos with main floor bedrooms and laundry rooms, etc. If I went up the road about 10 miles, my real estate taxes would drop about 20%. Real estate is hit with county, school and local taxes. I'm moving to the Carolinas for work, but might try to come back to PA in a few years when I retire. In my early 60s, so I'm getting closer. By next year I'll have a more realistic basis for assessing my cost of living in both locations.
Robert says:
Getting out of PA "gitouttahere". Can't afford the RE taxes - it's crazy and every school district/township has a different figure formula. They do not tax our SS but they sure get us on RE taxes. Seems like most of the PA people I talk to are use to it and it doesn't bother them too much but we as "seasoned citizens" are downsizing and trying to be a good steward of the small income we have. Before u buy in PA be sure you check what your taxes are going to be. I didn't do my home work and am now severely paying for it. Our home is for sale here in Carlisle, Pa - anyone interested?
Admin says:
This comment came in and we are re-posting it here:
I am looking to retire 'near a Southern California beach'. Do you know any builder planning a 55+ homes in that area. But i know that i like to buy a NEW HOME. Thanks, shamasundara