Builders Report Strong Growth in the 55+ Housing Market

Builders are showing increasedrnconfidence in the over 55 single family housing market.  The National Association of Home BuildersrnHousing Market Index (HMI) for that market has risen 19 points over the lastrnyear to 46.  First quarter results show thernhighest level for the senior housing HMI since the first such survey wasrnconducted in 2008 and it was the sixth consecutive quarter in which year-over-yearrnresults improved. </p

NAHB looks at two markets in calculatingrnits 55+ HMIs, the single family market and multi-family condominiums.  Builders in each market are asked theirrnperceptions of current sales, traffic of prospective buyers and their expectationsrnfor sales over the next six months.  Anrnindex below 50 indicates that more builders view conditions as poor than good.</p

In the single family 55+ sector builder sentimentrnabout present sales also rose 19 points from a year ago to 46.  Expected sales over the next six monthsrnincreased 21 points to 53, and prospective buyer traffic was up 15 points torn41.   The 55+ multifamily condo HMI rosernfrom 15 one year ago to 38, the highest first-quarter number in the survey’srnhistory.  The score for current salesrnrose 23 points to 37, expected sales climbed 23 points to 43, and traffic ofrnprospective buyers was up 23 points to 38.</p

 “Builders and developers for the 55+ housingrnsector continue to report increased optimism in the market,” said Robert Karen,rnchairman of NAHB’s 50+ Housing Council.  “We are seeing an increase in consumer demandrnfor homes and communities that are designed to address the specific needs ofrnthe mature homebuyer.”</p

“The strong year over year increasernin confidence reported by builders for the 55+ market is consistent with yearrnover year increases in other segments of the home building industry,” said NAHBrnChief Economist David Crowe.  “While demand for new 55+ housing hasrnimproved due to a reduced inventory of homes on the market and low interestrnrates, builders’ ability to respond to the demand is being limited by arnshortage of labor with basic construction skills and rising prices for somernbuilding materials.”</p

The 55+ multifamily rental indicesrnalso showed strong gains in the first quarter as present production increasedrn12 points to 43, expected future production rose 13 points to 48, currentrndemand for existing units climbed 14 points to 56 and future demand increasedrn13 points to 58.</p

Communities that are designedrnspecifically for homeowners over the age of 55 are exempted from some provisionsrnof the Fair Housing Act and can legally exclude families with children.  To qualify for these exemptions a dwelling mustrneither be specifically designed for and occupied by elderly persons under arnstate, federal or local government program, be solely occupied by persons agern62 or above, or house at least one person over the age of 55 in a minimum of 80rnpercent of the occupied units.

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