The residential real estate market is about to go “boom.”
According to AARP, for the next 18 years, Baby Boomers will be turning 65 at a rate of about 8,000 a day. That’s a lot of homeowners who may be thinking about unloading their large family homes.
“It is often misleading to generalize for a whole generation,” said Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business at Arizona State University. But Orr said some Baby Boomer trends that will impact the residential real estate industry are:
· Financing retirement by selling up and moving to a less expensive location.
· Downsizing from large family-oriented trophy homes to smaller low-maintenance homes.
· Continuing to work at least part time, often from home, so looking for high-speed Internet service.
· Looking for diverse cultural, educational and recreational opportunities and good restaurants.
Valley real estate leaders are prepared for the impact.
“Throughout the next decade, we will witness large numbers of Baby Boomers downsizing,” said Mike D’Elena, a Realtor at HomeSmart Elite Group. “The first wave of Boomers turned 65 in 2011. However, most who wanted to sell had negative equity and couldn’t. Since then, the Phoenix market has bounced back significantly so the wave is coming.”
Hoping to ride that wave, Valley-based Robson Resort Communities has developed a “lock and leave” product, allowing Boomers to downsize, while still enjoying the amenities they crave, such as golf, tennis, swimming and social clubs and events.
“With the Boomer demographic, builders must consider what amenities they will offer, now more than ever,” said Steve Soriano, CFO of Robson Communities. “Buyers are looking for added value to maintain an active and social lifestyle.”
One of the fastest-growing trends, the lock and leave concept allows residents to walk away and know their home is safe within a gated community and the grounds will be maintained while they’re gone.
“The lock and leave product appeals to Baby Boomers that seek a seasonal home without a lot of upkeep,” Soriano said. “The single-story, attached townhomes in the Villa Home Series showcase an open floor plan with landscaping and exterior maintenance covered by the Villas’ homeowner association. These homes give our resident more time to enjoy the weather, luxuries and the numerous activities that they come to enjoy in Arizona.”