While the share of 55-plus households who are on the move has remained relatively unchanged over the past decade, the reasons why they are moving have shifted dramatically. Today, the silver set is more concerned with the long-term value proposition of their housing and a desire to be closer to job centers—two factors that put an entire generation directly at the multifamily industry’s front door.
Not surprisingly, the desire to be closer to family and friends remains as the primary reason why those in the 55-plus market make a decision to move, according to “Housing Trends Update for the 55+ Market,” a joint study by the 50+ Housing Council of the Washington, D.C.–based National Association of Home Builders (NAHB) and the New York City–based MetLife Mature Market Institute. While that spells good news for apartment firms in metro markets courting the Gen Y renters whose parents largely fall into the 55+ demographic, the study suggests that older renters could likely be a multifamily resident demographic in and of themselves. “By the year 2020, almost 45 percent of all U.S. households will include someone at least 55 years old,” says NAHB chief economist David Crowe. “The number of those households seeking housing better suited to their changing needs will therefore rise dramatically.”
Based on an analysis of data from the Census Bureau’s 2009 American Housing Survey (AHS) on the 55-plus demographic, the NAHB/MetLife Mature Market study has determined that those changing needs are recently more concerned with affordability and employability. In past years, 55-plussers were more likely to move to obtain better housing quality. According to 2009 data, 11.1 percent of this age group on the move said they are looking for a less expensive apartment, compared with 9.8 percent who are looking for better quality, despite the higher price tag that likely comes with it. In 2005, those numbers were largely reversed, with 10.2 percent of 55-plus movers looking for better quality and only 9.1 percent concerned with cost. “We noticed that the recession brings financial reasons for moving to the forefront, and financial reasons are generally also more important to those moving to multifamily households,” says Natalia Siniavskaia, housing policy economist for NAHB.
Multifamily marketers looking to tap into the 55-plus demographic for residents would be smart to get ahead of the curve. While the market is large, its constituency is largely set when it comes to major housing decisions. “Tenure and structure shares in this demographic have been very stable since 2001,” Siniavskaia says. “Due to the demographics of the household, usually by age 55 they’re generally more stable and settled. It’s either/or when it comes to rentals and homeownership, with only a small percentage moving in and out of either sector.”