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Friday, January 9, 2015

Baby Boomers Could Be Next Wave Of New-Home Buyers

Retirement surge. Those words are real estate consultant John Burns' "big idea" for 2015.

More Americans were born in the 1950s — 41 million — than any other decade, he blogs. And they will be "dropping out of the workforce in droves" this year as they begin turning 65.

His advice: take advantage of the sizable surge, no matter what your business.

Lennar has, among designs seen as ideal for boomers, a NextGen "multigenerational" home with an extra suite.

For homebuilders, the seismic shift is an opportunity to throw down the welcome mat to a demographic that has better credit and more cash than younger buyers, especially those still largely missing first-timers.

"It's a pretty affluent group compared to prior generations of retirees," Burns told IBD.
Formidable Demographic

Those born in the 1950s are just part of the wave, though a big one, of the 78 million or so baby boomers born between 1946 and 1964.

Americans 55 and older are growing in absolute terms and as a share of the population, says Paul Emrath, vice president at the National Association of Home Builders.

According to the NAHB, households headed by someone 55 or older accounted for 43.3% of all households in 2014, up from 38.2% in 2007. It forecasts the number will reach 46.7% by 2020 — or nearly half of all U.S. households.

"It's the baby boom effect, basically," Emrath said. "It means that active-adult housing is likely to continue getting stronger going forward."

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1 comment:

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