So Long Traditional Retirement Homes
Retirees are Seeking Alternative Lifestyle and Housing Options
As the baby boomer generation is reaching retirement, they have something different in mind when it comes to housing options.
Rather than following in their elders’ footsteps of settling into a traditional retirement home, they’re looking into alternative lifestyles and both more urban and rural options. A demographics researcher for the University of Virginia, Hamilton Lombard, shares that the nation’s 65+ population is expected to grow up to 90% by 2040, and in some regions, the majority of the population growth will stem directly from this community. This rapidly growing population is having a huge effect on the housing market across the country, including rentals.
The reason nursing homes often follow retirement is self-explanatory; as those living alone or with partners born around the same time begin to age, safety concerns arise. Nursing homes ensure that there is someone to help whenever you need it while placing yourself in a community with shared values. Seemingly, baby boomers aren’t physically aging at the same rate as the previous generation and are proving to live longer, healthier lives. With home renovations such as widening doorways, grab bars in bathrooms, and slip-resistant floors, these retirees can continue living on their own for much longer. With a healthier lifestyle, many baby boomers are still very active and are looking to continue aging in a community that shares those ideals while offering fun activities you may not expect grandpa to be indulging in, such as water sports or interactive classes.
One of the largest factors for this generation of retirees is that they can afford this variety of options. Those who are over 65 are shown to have the lowest poverty rate of any population group in the U.S, based on a U.S. Census Bureau report. Not only are they financially sound, but 81% of that age group also own their homes. If retirement is on your horizon and you’re set on aging in place, there are a handful of options to consider. If renovations in your current home seem like too much of a headache, you may be considering a new location, perhaps downsizing to a smaller home that is affordable and more convenient to inhabit, potentially eliminating stairs.
There are many reasons to downsize your home, especially as your immediate family shrinks and you simply don’t need the extra space anymore. Even if your mortgage is entirely paid off, larger homes cost more in a variety of ways; utilities such as heating, cooling, and electricity, upkeep, property taxes, etc. By downsizing to a smaller home, you’ll likely make a profit from your home sale and cut your monthly expenses down substantially. The average homeowner spends between 1 and 4 percent of their property’s value just on home upkeep, so cutting down your home’s square footage will cut your bills down as well. Money aside, maintaining a smaller home is much easier and will allow you more time to spend with family, friends, and maybe even on discovering new hobbies.
If an active adult community interests you more than renovating your home or purchasing a new smaller abode, you may not know where to begin your search. Communities such as Epcon, with locations in 18 different states across the country, NoHo Senior Arts Colony for the creative types in North Hollywood, CA, and Evergreen Real Estate Group’s multiple senior rental apartment complexes in Illinois with technology-focused amenities are just a few associations that have jumped on the wagon to appeal to today’s retirees, not last generations.
As for the senior rental market, according to a 2017 analysis of U.S. Census Bureau data, between 2009 and 2015 the number of renters over 55 hiked up 28 percent, which is drastic in comparison to the 3 percent increase in renters under the age of 34. Developers and real estate agents are certainly taking notice of this growing population and trending idea of alternative retirement options. With nearly 80 million people reaching retirement age, there are boundless opportunities for those offering housing options, whether they are building new complexes or selling homes. A real estate firm, JLL, recently released an industry report sharing that more developers are taking advantage of the urban living demand for seniors by focusing on new development projects in existing, established communities.
It is a classic pattern that often falls under the umbrella of the American dream; leave the city for the suburbs to buy a home and start your family. But once the kids are out the door starting families of their own, the daydreams of convenient city life will likely begin to flood back into your head. As the director of development at Evergreen shares, “It’s part of a broader move in real-estate development that says the way we built cities, with commercial space below and then we lived ‘above the store,’ so to speak, well, there’s a certain amount of wisdom in that.”
In the past, visions of retirement are often relaxing in a lawn chair somewhere warm, quiet, and maybe even a bit isolated. The upcoming retirement population sees things a bit differently. It turns out baby boomers have a similar checklist of their ideal neighborhood to Millennials; convenience, walkability, entertainment, and affordability. Denser suburbs and cities offer these things and help promote an active lifestyle. A survey conducted by architecture firm Perkins Eastman showed “26% of client firms that build and redevelop properties for seniors says they believe boomers will be most concerned with living in proximity to an urban location or town center, up from 19% in 2017.”
On the other side of things, those retirees who aren’t interested in more urban living are choosing rural areas to settle down in due to extreme affordability. When the word retirement comes to mind, Florida is probably to follow. While Florida has still managed to reach number one on Wallet Hub’s 2019 Best & Worst Places to Retire, there are plenty of states that are coming up as a close second. In fact, Moneywise’s similar list of The Best States for Retirement in 2019 has ranked South Dakota number one with Florida as the runner up. The Wall Street Journal shared the research of a University of Virginia demographer, Hamilton Lombard, “Census data show that from 2010 to 2017, net migration to retirement-destination counties in Appalachian regions of Georgia, North Carolina, and Tennessee increased 169%, the same percentage of growth for retirement destinations in Florida.”
Rural retirement is becoming more and more popular as retirees prioritize a lower cost of living, tax breaks, and respectable hospitals over other conveniences of more popular retirement locations and nursing homes. South Dakota, for example, is America’s best retirement state “hands down” in Moneywise’s opinion, due to excellent outdoor activities such as hunting, fishing, hiking, and camping. For those seeking a quiet lifestyle that is equally as active, rural states such as SD are the way to go. Not to mention, of course, the very low cost of living (a one-bedroom in the town center is on average $765 a month) and the fact that the state’s sales tax is 4.5 percent and there is no income tax or inheritance tax.
We’ve been shadowing Millennials to keep up with the real estate trends, but it looks like it may be time to switch our direction towards the baby boomer generation. Retiring is infinitely exciting if you’ve planned accordingly and explored all options to find the right fit for yourself. Whether that be a small home in Georgia or a lively city apartment above a library and community center, one thing is for sure—this generation nearing retirement is going to be living a lively and inspiring life.