As more Baby Boomers look not just to downsize but to “rightsize” in their retirement years, the 55+ housing market is humming along nicely, showing solid activity despite the faltering state of the overall market.
According to the latest from the National Association of Home Builders, builder confidence in present sales for the 55+ market remained at 76 in the second quarter of 2019, holding steady at a record high.
For the single-family market, sentiment fell a single point to 71, which NAHB attributed to a slowdown in prospective buyer traffic. That said, the index showed that expected sales for the next six months increased one point to 78.
Similarly, the builders in the multifamily market for 55+ buyers reported solid confidence, with present and expected sales up, while buyer traffic fell two points.
Karen Schroeder, chair of NAHB's 55+ Housing Industry Council, said even though the single-family index fell by one point, builder confidence in general remains strong for this market segment.
“We expect the 55+ housing market to continue on a positive path moving forward,” Schroeder said.
But NAHB Chief Economist Robert Dietz warned that the market could be impacted by rising builder costs.
"Demand for 55+ housing remains solid, as demonstrated in the surge for 55+ rental demand," said Dietz. "Builder sentiment for the for-sale 55+ housing market also remains in positive territory, supported by low inventory of existing homes. However, it is being constrained by development costs and their impact on affordability."