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When it comes
to housing, baby boomers are different from many people in two important
ways: they have more equity in their homes, and many are preparing to move.
If housing experts are right, boomers—the 77 million Americans ages 47 to
65—soon may be a sweet spot in an otherwise sour market for new homes.
Ready to downsize
The retirement market, experts say, appears ripe for change.
Having raised families, many baby boomers are ready to turn in the keys to
their oversized suburban McMansions. Research
suggests boomers are tired of climbing stairs and mowing lawns and will seek
ranch-style homes along quieter blocks, with features that make life a little
easier on achy backs and knees.
So far, however, boomers haven't started moving in big numbers.
"They have hesitated because of the recession," Charles says.
"Once the government and the stock market settle down, and the market
turns, you will find this bunch that has hesitated will become a pent-up
demand."
Boomers and retirees, he says, will be among the largest share of the market
beginning as early as 2012.
If so, it could be a potent market.
It would be hard enough to ignore 1.7 million Hoosier boomers, who make up a
quarter of the state's population, but add in the housing slump, and it would
seem impossible.
"These days a lot of people can't move," says Indiana University
economist Willard Witte, "because they can't or won't sell their house
at a big loss."
Unlike the younger families targeted by most builders, however, boomers have
been building equity for decades. They have paid down their mortgages over
time, putting them in a better position to sell. Witte said boomers may be
the first demographic to move when the market picks up. Charles agreed.
"I think we are heading into a huge retirement market," he says.
Long wish list
What boomers want, however, appears to be in short supply.
Most boomers now favor ranch homes that are about 1,500 to 2,500 square feet,
Charles' research shows, selling for $140,000 to $230,000. Some prefer
age-restricted communities, low-maintenance townhomes and Downtown
condominiums. The majority, his research shows, say they want single-story
houses within neighborhoods that attract a broader mix of people -- and are
close to where they now live.
And they carry along a pretty specific checklist:
• Open spaces
to host friends and family, rather than separate dining rooms, living rooms
and kitchens.
• Features such as vanities and electrical sockets that are a bit higher off
the ground than normal.
• Storage, especially his and hers master closets, plus structurally
reinforced attics.
• Backyard living spaces—not swimming pools or outdoor kitchens, but large
decks with fireplaces, hot tubs and wet bars.
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