Age-Restricted Homes Slightly Smaller, Pricier than Others Started in 2018

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Of the roughly 875,000 single-family and 375,0000 multifamily homes started in 2018, 29,000 and 31,000, respectively, were age-restricted according to NAHB tabulation of data from the Survey of Construction (SOC, conducted by the U.S. Census Bureau and partially funded by HUD).  A housing development can legally restrict the ages of its residents, provided it conforms to one of the set of rules last modified in the Housing for Older Persons Act of 1995.

NAHB was first successful in persuading HUD and the Census Bureau to collect data on the age-restricted status of new homes in 2009, during the depths of the housing downturn.  In that year, builders started only 17,000 (9,000 single-family and 8,000 multifamily) homes in age-restricted developments.  But the numbers have generally increased, subject to considerable fluctuation, since then.  The 29,000 single-family and 31,000 multifamily age-restricted starts in 2018 were the highest recorded since the inception of the series in 2009, although only slightly higher than the previous peak in 2016.

The SOC also provides some data on the basic characteristics of age-restricted and other single-family homes started.   Although the differences are not huge, in 2018 the age-restricted homes started were somewhat smaller (with a median of 2,000 square feet of living space, compared to 2,400 for homes that are not age-restricted) and on smaller lots (less than one-sixth of an acre, compared to one-fifth).  Despite that, the age-restricted homes cost slightly more (with median sale price of $330,000 vs. $322,000, based on homes built for sale).  As a result, the price per square foot was $121 for age-restricted, and $104 for other, single-family homes.

Other questions in the SOC show that new single-family homes are more likely to be townhomes, and single story with no basement if the homes are age-restricted.  The age-restricted homes are also more likely to come with patios, but less likely to have porches and decks.  Finally, age-restricted homes are less likely to require a loan and more likely to be purchased for cash, as home buyers who are older have had more of a chance to accumulate the savings and assets (often equity in a previous home) that can be converted to cash.



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