Aging in place has become the preferred way to live for many baby boomers who have come to love their homes, their neighborhoods and their close proximity to family and friends. The term refers to empty nesters that have chosen to live their lives out as long as possible in their family homes. However, many are concerned this could have an impact on the housing market with lower turnover of single family homes.
Two Thirds Not Planning Moves
According to a survey by the Demand Institute close to two thirds of Baby Boomers are not planning to move any time soon. Instead they have decided it is better to age in place and continue to enjoy the life and community they have lived in for much of their married or adult lives.
For many, the Great Recession can be blamed for their decision to remain in their current homes. Boomer net worth fell drastically during the Great Recession, to $140,000 and this is where it currently stands. It is estimated had it not been for the recession, their net worth would be closer to $370,000. This has reduced the options Boomers might feel they have if they wish to live comfortably once they retire.
67% want their Current Community
Of Baby Boomers who do wish to move, 67 percent wish to remain close to their current communities as opposed to moving to a retirement community. In fact, remaining closer to family and their community, has become more desirable than seeking a new life in a warmer climate.
When seeking a new home, many Boomers are hoping to find their dream home. That means that 46 percent of boomers will actually be hunting for a larger home, or a home that is comparable to their current home size as opposed to the traditional move to a smaller home. This means more competition for the larger single family homes traditionally sought by younger couples and families.
Finding a Dream Home
The reason behind this change is that many Boomers have rented and/or compromised on the home they currently own. Now that they are in a position to purchase the type of home they always wanted, they are acting on their dreams.
The remaining 54 percent are still looking to downsize, either in square footage or mortgage size if possible. Boomers who are living in their dream home or one that meets most of their needs are looking for a home that will allow them to live independently with less maintenance. However, they are now looking for higher end finishes to add to their overall comfort and the same communities with amenities usually sought by younger home buyers.
Unlike the downsizers of the past, Boomers are now likely to spend more on their next home with an average price of $200,000 compared to upsizers at $180,000.
Demand for Renovation Services
As turnover of single family homes decrease, there will also be a rise in the demand for renovation services. Boomers will be remodeling their homes to accommodate their changing needs. By 2025 baby boomers will be in their 70’s and face more health and mobility issues that will make it more difficult to live independently.
According to homeadvisor.com renovations for Boomers are in high demand. However, the renovations in which they are investing are not necessarily age related. In fact, their findings show that of the 61 percent who intend to age in place, 65 percent feel they do not require aging-related improvement, and 78 percent have never completed an aging-related remodel, upgrade or renovation.
Instead, the new mind set for remodeling should be based on logical improvements to the functionality of the home which in turn often translates into safer living and accessibility such as smart technology, more open spaces, less steps, and better lighting. This can also help keep the home appealing to younger home buyers when it finally does come time to sell.
Read more: http://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/jchs-sonhr-2015-full.pdf