Of the roughly 1,127,000 single-family and 474,000 multifamily homes started in 2020, 37,000 (15,000 single-family and 22,000 multifamily) were built in age-restricted communities, 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 residential community can be legally age-restricted, provided it conforms the one of the set of rules specified in the Housing for Older Persons Act of 1995.
NAHB was first successful in persuading HUD and the Census Bureau to produce data on the age-restricted status of new homes in 2009, during the depths of the housing downturn. In 2009r, builders started only 17,000 homes in age-restricted communities (9,000 single-family and 8,000 multifamily). The numbers subsequently increased, reaching a peak of 29,000 single-family and 31,000 multifamily age-restricted starts in 2018. Although the number of age-restricted starts has fallen from that high point, this does not necessarily signal reduced interest in serving the market for home buyers age 55 or older, as new homes may be designed with features that tend to appeal to older buyers without being explicitly age-restricted.
The SOC provides enough data to look at the characteristics of new age-restricted single-family homes to see if they differ from other single-family homes started in 2021. In that year, the median age-restricted home was slightly larger than the median for other single-family homes: 2,400 vs. 2,300 square feet. The median lot size for age-restricted homes, however, was somewhat smaller—roughly one-sixth of an acre vs. one-fifth. Wednesday’s post examined trends in lot sizes in more detail, particularly how the share of homes built on smaller lots continued to increase during the pandemic. Another trend that continued during the pandemic was rising house prices. The median price of a new, age-restricted single family homes started in 2021 and built for sale was $472,000—$100,000 higher than it was a year earlier and considerably above the $400,000 median price of non-age-restricted homes started in 2021.
Other questions in the SOC show that new single-family homes are more likely to be attached (i.e., 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 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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