Builders Confident in 55+ Housing Market

Filed in 55+ Housing, Economics by on November 6, 2014 0 Comments
del webb

This home in the 50-unit Del Webb at Rancho Mission Viejo in Orange County, Calif., is an NAHB 50+ Housing Award winner, and evidence of a new boom in senior housing.

Builder confidence in the single-family 55+ housing market for the third quarter is up year over year, according to the NAHB 55+ Housing Market Index (HMI), released today.

The single-family index jumped nine points to 59, the highest third-quarter reading since the inception of the index in 2008 and the 12th consecutive quarter of year-over-year improvements.

“Demand for 55+ housing has never been higher, and this quarter’s index clearly demonstrates that,” said Steve Bomberger, chairman of NAHB’s 50+ Housing Council and president of Benchmark Builders Inc. in Wilmington, Del. “Consumers in this market are looking for a home that caters to their specific needs, and our builders and developers can create homes and communities that address them.”

There are HMIs for two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each index measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic). A number below 50 indicates that more builders view conditions as poor than good.

All components of the 55+ single-family HMI posted increases from a year ago: Present sales jumped 13 points to 65, expected sales for the next six months climbed 10 points to 63 and traffic of prospective buyers rose three points to 46.

The 55+ multifamily condo HMI posted a four-point gain to a reading of 41, which is also the highest third-quarter reading ever. All components of the index increased for the third quarter: present sales rose five points to 42, expected sales for the next six months climbed three points to 43 and traffic of prospective buyers increased three points to 38.

The indices tracking production and demand of 55+ multifamily rentals also posted positive results in the third quarter. Present production rose four points to 52, expected future production increased two points to 52, current demand for existing units climbed four points to 64 and future demand increased five points to 65.

“The consistent rise in home equity has contributed to the strong gains in the 55+ housing market,” said NAHB Chief Economist David Crowe. “Many consumers who had been sidelined due to the inability to sell their current homes at an acceptable price are now in a position where they can sell them, enabling them to rent or buy in a 55+ community.”

For the full 55+ HMI tables, please visit www.nahb.org/55hmi.

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