Older … How About Wiser?
There are just shy of 50 million people, age 65 or older, living in the United States, according to the Census.
That number, by 2060, is expected to double. Already, 54.8% of residents of Sumter County, Fla.–the most populous state for 65-plus year-olds at 19.4%–are over the age of 65. The Villages, a Sumter County, Fla., retirement community, has a population of 118,891 (as of July 1, 2015).
Right now, the median household income, for households led by people 65 or older clocks in at a median of $38,515, and the median net worth of such households is $170,516. Of the 47.8 million people in the age range, 4.6 million men and 3.7 million women count themselves as in the labor force. At the same time, just 5.3 million 65-plus year-olds work year-round, full-time. One in six business owners is 65 or older.
Some 57.8%, almost three out of five, 65-plus year olds are married, and 79.5% of them report that they’re homeowners.
North Dakota is the centenarian capital of the United States, with 3.3 people 100-plus per 1,000 North Dakotans.
Now, 65 is an age typically associated with retirement, and in fact, one in five actually retired people did so between the ages of 65 and 69. Far more people, 37%, who are not retired yet believe they will retire during that age range. Fewer people these days anticipate that they’ll retire younger, between the ages of 60 and 64, at 17%. People actually retire younger for the most part than they believe they will do so, and the Employee Benefit Research Institute notes that 76% of today’s retirees retired at 64 or younger.
What is all this data about, anyway?
The population figures continue to signal a boon for developers of 55-plus new-home communities, as well as for home remodels that change design, engineering, and livability to allow people to remain happily in their homes as they age.
What we’re learning, and will continue to learn, is that the economics of getting older are in flux. One can’t take a snapshot of the financial wherewithal, the motivations, and the values of a near-retiree from 10 years ago, or 5 years ago, or even 2017, and apply it to how housing preference and attainability will work in the months and years ahead.
The 55-plus opportunity will be greatest for those developers and builders whose designs, locations, and price-points match up to the means of people for whom health, their kids educations, and housing expense represent ever larger increments of what they pay for, later and later into their lives.
America’s new communities, with new homes for 55-plus buyers, will appeal to those buyers’ pocketbooks, their dynamic and evolving senses of financial urgency, the logic of their connection to children and grandchildren who may depend more on their availability and easy access, less on their sense that now they get what they want.
We’re mistaken to believe that a fever chart headed up on the right-hand axis means that sheer gravitational force will carry 55-plus neighborhood developers to success. Remember, laws of big numbers mean that some calculations will be wild miscalculations, estimates of demand come masked with complexity and the high likelihood of change.
An attitude to take as you model home building development and investment for 55-plus business is that these buyer prospects are the “first-time buyers” of a product line aimed at a cohort that is, in a sense, entry-level for a home for the next quarter or third of people’s ever longer lives.