As real estate buyers age, the need for different housing solutions arise. From the basic need for additional senior friendly construction to the more complex multi-generational housing, real estate sellers need to pay close attention to the needs of the “new” buyers.
Downsizing and Vacation Homes
As homeowners age they tend to need less space and prefer to move to warmer climates. Even if they choose to stay in their current location, when their children move out of the nest and it becomes more and more challenging to care for their multi-bedroom home, many seniors tend to move to smaller, easier to maintain properties.
The condo lifestyle fits these consumers well. Real estate sellers in condominium or co-op communities should play up the worry-free maintenance of their properties. Condos and co-ops provide many of the carefree services and upkeep of a rental, while still providing ownership they can transfer to future generations.
This same logic works well for those mature adults seeking a second home. Unlike a timeshare, where time is limited to a certain number of weekends a month and their value depreciates by 50% once they are purchased, a condo in a warm climate provides worry-free maintenance and a potentially strong investment.
Multi-generational Housing
Poor economic times continue to affect many seniors on fixed income. Furthermore, many parents decide to move back in with their children for any number of reasons. Traditionally, keeping the same house they raised their children in does not work because of the age of the home and the size.
Families considering housing grandparents should look for homes with first floor bedrooms and large family rooms. These types of homes provide a nice space for family gatherings and keep the grandparents involved in the activities without forcing them to walk up or down a flight of stairs.
Real Estate Investments for Retirement
The Baby Boomer generation should strongly consider real estate as an excellent retirement investment. Putting aside the volatility of the price of property, once purchased, a real estate investment could provide a steady stream of income annually. Hiring a management firm puts very little stress on seniors as landlords and provides them an excellent source of cash flow and appreciation. Seniors often reach retirement and receive multiple lump sum payouts, with no clear financial directions to make their money last a lifetime. High quality real estate provides a surprisingly safe way to manage annual cash flow.
Baby Boomers change the real estate landscape significantly. Sellers should be very aware of who is shopping for their properties and put together sound marketing pitches that fit their needs.
Michael Cook - Michael Cook is currently a Real Estate Investment Banker for Wachovia. He and his partnerstarted their own real estate investment ...
