A lot has been said about the ‘silver tsunami,’ with predictions that baby boomers will move in droves, suddenly unlocking tons of inventory for younger homebuyers. After all, boomers own almost 10 million homes and are likely considering a lifestyle change.
Our data supports this prediction: 85% of baby boomers who are planning to sell their homes in the next 5 years will actually do so in the next three. But the question remains: Where will they move?
New construction in age-restricted communities is becoming a rising trend. According to the National Association of Home Builders (NAHB), the number of homes being built in age-restricted communities has grown significantly, since 2009, with about 6% of all new homes built for those either age 55 and older or 62 and older, as of 2022. As a growing population of baby boomers consider making transitions, homebuilders have a unique opportunity to cater to this demographic of buyers, and entice them to relocate to 55+ new build communities.
These communities can be an affordable and attractive downsizing option for baby boomers eyeing their next phase of life, or their “second act.” Here are some reasons why – and how industry leaders, including homebuilders, can meet their expectations.
Fostering social connection
Social isolation is an ongoing public health concern, particularly among older adults. The University of Michigan National Poll on Healthy Aging (NPHA) found that in 2023, over one-third of adults (37%) aged 50–64 reported feeling isolated from others in the past year. The implications are serious: NPHA polls have found “feeling isolated from others, feeling a lack of companionship, and having infrequent social contact were strongly associated with poorer physical and mental health among older adults.”
The benefits of 55+ communities can counter some of this social isolation. Most of these communities have amenities designed to foster connection. For example, in some master-planned communities for 55+ homeowners, amenities include golf courses, parks and recreation trails, tennis courts, pools, restaurants, grocery stores, shopping centers, medical facilities, mini theaters, and more. These gathering spaces offer a natural way for homeowners to meet new people and make friendships with those who have like-minded interests. That’s needed more than ever.
Simple-sizing homes and life
We found that most baby boomer sellers aim to downsize, with 74% saying they’ll reduce their living space by about 25%. This sentiment tracks with a trend we’ve seen among the general population: A desire to make intentional choices at home that help homeowners embrace an easier-to-manage, more contented lifestyle. We call this “simple sizing.”
Builders can lean into this sentiment with their 55+ communities, which often feature smaller, single-story homes that are easier to maintain. According to the NAHB, many of these homes also use design elements that promote low-stress living, such as accessible bathrooms and gardens, which may be appealing to boomers.
In search of warmer climates
Many 55+ new build communities are based in areas of the country with warmer climates, and that’s a selling point for baby boomers. While we found that the motivations for boomers moving varies, there was a notable emphasis on seeking better weather conditions, or living near water. This is especially true among those planning to move out of state or internationally (45%), and interestingly, this desire outweighs wanting to be closer to family (31%). Builders planning new communities or marketing to buyers should keep this criteria in mind.
Selling considerations
When it comes time for baby boomers to transition out of their current homes, their home-selling approach reflects a blend of personal, economic, and market-driven considerations. For example, our data shows that Boomers are mostly mortgage rate agnostic — but about half are factoring the upcoming election into their selling timeline. Where boomers are consistent is with their top three priorities when selling:
1) Getting the highest price (80%)
2) Speed/selling quickly (55%)
3) Not having to do repairs (49%)
Homebuilders marketing their communities to this demographic should factor these priorities into how they communicate and work with potential buyers.
No matter when the silver tsunami comes, the unique wants and needs of baby boomers planning to sell and buy a new home could influence the trajectory of the market. What is clear is that homebuilders have a strong opportunity to meet boomers’ expectations with the amenities and benefits of 55+ new build communities.
This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.
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