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After an unexpected lull in the development of housing geared towards retired or retirement aged residents, which created a bit of a void in the market for a few years at the start of the decade, construction of ‘50-plus housing’ became the only hot spot in the residential market over the past couple of years. But just as the developers of active adult housing started to get some momentum, the economic turbulence of the past twelve months has thrown a monkey wrench into many of the market assumptions, and created even more As the specter of the retiring Baby Boomer generation loomed in the 1990’s, new solutions for housing older Americans popped up. For decades, there were very few housing options tailored for aging Americans. Because life expectancy was shorter, you tended not to outlive the needs of your primary residence. Those that did, found the choices were among differing kinds of retirement homes, many of which offered few options beyond nursing care. Older Americans now live longer, and healthcare improvements have allowed those extra years to be much The term ‘50-plus’ encompasses those folks who are (obviously) over the age of 50, but who are still fully capable of independent living. Because this group is the largest demographic in the nation (now fully including the Baby Boomers), developers are paying close attention to their expectations and demands. And right now the ground is shifting underneath any previous assumptions.
“We’ve always been targeting the active adult,” says Ann Marie Moriarity, NAHB’s 50-Plus Director of Communications. “That housing product also has components of assisted living and other senior living arrangements, but with the growing number of retirees from the Baby Boom we saw a need for a focus on housing that was different from the past.” NAHB, along with other housing groups and consultants have dedicated significant resources to studying the habits and characteristics of the older segments of our population. Not surprisingly, they found that the housing needs of those over 50 have some elements that are unique to that stage of life’s journey. Some of the elements, like no maintenance living or more comfortable floor plans, are really lifestyle choices; others, like accessible bathrooms and heightened security, are accommodations for aging in place, without requiring a move into institutional housing. To track how older Americans are making decisions about housing, the NAHB, in conjunction with MetLife, created the Mature Market Institute. Its report on the trends in 55+ housing shows the major factors influencing the choice of housing, and the April 2009 report shows some interesting shifts since the 2003 report. According to the U.S. Census Bureau’s current population survey, the number of Americans age 55 or older has increased from 52.2 million (accounting for 21% of the total population) in 1990 to 59.3 million (still about 21%) in 2000, and to 70.6 million (23%) in 2007. Based on NAHB’s forecast, the 55+ population will grow to 76.6 million (25% of the population) in 2010, and to 85.3 million (26%) in 2014. Consequently, demand for housing designed for older Americans has been growing and is expected to continue to grow. • The majority of 55+ households do not live in age-restricted (also called age-qualified) or other 55+ communities, yet that number is on the rise. The share of those living in active adult age-restricted communities grew from 2% in 2001 to 3% in 2007. Residents in this type of community registered the highest satisfaction rates. However, most 55+ respondents indicated they were happy with their current homes. • Main reasons for moving to a 55+ owner-occupied community were family or personal reasons, financial or employment reasons, and the desire to have a higher quality home. In multi-family communities, family was the number one reason, but reducing costs and increasing quality were also top priorities. • Within the community, design and looks were most important to 55+ single-family home buyers, while closeness to family and friends was a higher priority in age-restricted rental and multi-family communities. • Home and community location relative to work location are important for 55+ households. Proximity to work, as the reason for choosing a community among 55+ movers into single-family detached homes jumped from 11% in 2001 to 17% in 2007. In addition, the number of 55+ households working from the home rose rapidly over the six-year period. The number of movers into other 55+ owner-occupied communities rose from 6% in 2001 to 13% in 2007. • Active adult communities are attracting younger buyers (age 60 and under). • Female-headed households dominate the multi-family and age-restricted rental market. • The share of home buyers in age-qualified communities with some college education or more has increased in the past six years, from 50% in 2001 to 73% in 2007. • The share of all 55+ buyers of newly built homes using a mortgage has increased. • The projected number of housing starts in 55+ communities will fall in 2009 as the economy continues to weaken and prospective buyers find it difficult to sell their current homes, but production will begin to revive For a developer or builder, these facts paint a very desirable picture of a rapidly growing segment of the population, with a growing preference for living in age-qualified communities. Moreover, the buyer is quite predictable in size and gender, is becoming more and more a better-educated buyer, tends to settle in for a longer haul, and doesn’t leave their lifelong home area three out of four times. It is this latter fact which is most interesting for builders in cities like Pittsburgh, where weather was considered a motivator to move most 50-somethings to the south. During the past half-decade or so, builders in Western PA seem to be bearing out the larger-than-expected demand from older buyers who stayed local, as they saw more and more traffic for housing that would meet their needs. The momentum was sufficient that the Builders Association of Metropolitan Pittsburgh (BAMP), the local NAHB chapter, started up the 20th local 50-Plus Housing Council. “There aren’t a lot of growth homebuilding trends in our industry right now, so we want to help our members find a competitive edge with something that is a growing trend,” explains BAMP Acting Director Jim Eichenlaub. “The slower market has impacted the empty-nester who needs to sell their home first, but that’s a local council we want to see get up and running.” BAMP’s 50-Plus Council is new, with twelve member companies, but the group has begun to tour member’s sites where active adult projects are under construction, attend national meetings, and gather information about what active adults want in new housing. “It’s not so much that we have any members who are dedicated to active adult housing, as it was that our builders were finding that the prospects for what they were building fit that profile more and more,” explains Eichenlaub. In addition to the desirable demographics, active adults are buyers with financial characteristics which are exciting to local builders. Active adult households have the highest income, the highest net worth, and are continuing to work longer, at least part-time. Because most have several decades of home ownership experience, the percentage of equity that the 55-and-over buyer brings is much higher than at other life stages, and equity is important to this group, since the days of lower monthly income are likely ahead. High income, high equity, high net worth prospects aren’t knocking on the door every day. When you consider such a prospect group is also part of the largest generation ever born in America, well, you can see where this In the mid-decade, a number of smaller private housing developments, like Adams Crossing, Fayette Farms or Hampton Woodlands were among the newer mixed use or traditional neighborhoods that included units friendly to active adults in their offerings. These communities capitalized on the appeal of no maintenance and floor plans targeted for empty-nest lifestyles, but the overall developments weren’t developed for active adult lifestyles as
The team recently completed an expansion/renovation of the Woodcrest Retirement Residence in Moon Township. The facility has recently received two prestigious awards, the Gold Medal from NAHB’s 50+ Housing Awards, and Gold Leadership in Energy Efficient Design (LEED) certification from the U. S. Green Building Council. The latter award highlights the trend towards extraordinary upgrades. “It was typical of a Rodriguez/Sota project in that it looks more like a Marriott resort than an elderly living space,” comments Sota vice president Joe Nelson. “The corridors are wide, there is beautiful trim and upgraded amenities. It’s also a very green building, not just energy efficient but also much healthier to live in.” Financed partially through Pennsylvania Home Finance Authority tax credits, Woodcrest’s renovation was part of an initiative by the Federal Housing Administration to make all its projects measurably green. “At minimum, the construction had to meet EnergyStar standards for residential construction. We had to get a HERS rating. But we chose to have the project designed to meet LEED Gold standards,” explained Nelson. One large scale new development that started in 2007 was the Providence Point community in Scott Township, built on the site of the Kane Hospital near the Bower Hill and Vanadium Road intersection. Providence Point has two main living components, patio homes and apartments. Residents of both styles of living have access to an extensive array of lifestyle amenities, including a wellness center, day spa, indoor swimming pool, library, movie theater, classrooms and an arts studio, plus amenities for day-to-day living that have become standard in active adult communities. Providence Point contains 222 apartment units, ranging in size from 760 square feet to 2,100 square feet. There are 35 detached patio homes as well, averaging around 1,800 square feet. Unlike the private residential developments, Providence Point is set up as a LifeCare community, operated by the Baptist Home. Residents pay an entrance fee, depending on the size of the dwelling unit, which covers all the lifestyle amenities plus planned health care needs. For those interested in locking up the cost long term, there are options for paying a lifetime entrance fee that assures you access to living units throughout your life, locked in at current rates. The Sherwood Oaks project is part of the UPMC Senior Care network of sixteen communities around the region. UPMC is now looking at expanding the kinds of living and services provided active adults by partnering in one of the largest traditional neighborhoods to be developed in the region, Park Place in Cranberry Township. As part of phases six and seven of the Park Place plan, 100 single-family units and 36 multi-family units will be built as an age-restricted community as an extended part of Sherwood Oaks. What makes the Park Place concept unique is its relationship to the larger UPMC family. “Buyers at the age-restricted portion of Park Place will choose their lot and house like any other development, but they will also have the opportunity to choose from an a la carte menu of services like at a UPMC facility,” explains builder John R. Deklewa, president of Residential Development & Construction. “Depending on the level of independence the buyer wants, he can choose no maintenance kinds of services – lawn care, snow removal, handyman services – or take things further by selecting medication management, transportation services, The a la carte services will have ongoing fees associated with them, over and beyond the cost of the home. Deklewa points out that in addition to the services, Park Place buyers can opt to assure themselves a long-term spot at Sherwood Oaks heightened care facilities through a single payment at current rates. UPMC’s expansion of its Senior Care services to an off campus private development seems to recognize how 50-plus housing has shifted with the buyer’s preferences. As the wave of retirees and soon-to-be-retirees from the Baby Boom sell their family home for an empty nest home, it’s becoming more apparent that more of the buyers are seeking something more manageable in size, and more sustainable in design. The latter seems to apply to lifestyle as well as green building. The uncertainty that has resulted from the fall 2008 shakeout of the financial markets has also added to whatever momentum existed towards more conservative and sustainable living arrangements. Whether it is because 50-plus Americans will be working longer, or because it has taken a decade or so for the market to develop interesting options, buyers who are looking for communities catering to 50-plus residents have a broad range of living options. For the active adult buyer in Western PA, the good news is that builders are getting on board with the kinds of housing styles that will appeal to them. At present, there are literally dozens of opportunities to find new homes after leaving the detached family dwelling. It’s clear that Pittsburgh builders have picked up on the key trends of security, flexibility and amenities that suit an active adult lifestyle, and are ahead of the curve in adding value and sustainable design to what is being offered. NH |
Active adults are having an impact on how new projects are being developed, even in more traditional institutional settings. Local developer a. m. Rodriguez Associates has been creating housing for older residents across a broad spectrum of types for two decades, often adapting an older building, like an abandoned school, to new use as an apartment. With builder Sota Construction, Rodriguez has always maintained a high standard of finish and amenity, but the more upscale minded resident of today has taken the design to a higher level.