Builders asking some cities and HOAs to reconsider age restrictions

During the boom years, cities loved age-restricted communities (usually 55+) because seniors don't demand public school services, they trend to drive less, they ask less of their government and, best of all, calls to police departments for raucous parties tend to be rare when they end by 8pm.

Now, however, the very benefit that allowed these communities to sell at paces far beyond what was typical for an area -- the age restriction -- is starting to act as a anchor. Consequently, some builders are asking both municipalities and HOAs to rescind these age restrictions in order to spike sales. From a BuilderOnline.com story:

When the housing market was booming, age-restricted communities made business sense for builders, too. Most of the buyers owned their homes outright and had seen the value of those properties skyrocket. They could sell quickly and pay cash for their new homes.

Now, those buyers are stuck, unable to sell their current homes--or unwilling to do so at current home prices. As a result, builders who won government approvals based on restrictions that said at least one occupant of each unit would be at 55 years old now have projects that are dead in the water.

Some builders are trying to get relief from the restrictions so they can jump-start sales. Kalian Companies, a Red Bank, N.J.-based builder/developer, spent nearly a year working on revising the plans for Carriage Park at Bound Brook, a 144-unit condominium project in the town of Bound Brook. “When we bought it, we didn’t even think about not going age-restricted,” says company president Mazin Patrick Kalian. “Every project in New Jersey was getting approved age-restricted because the schools in New Jersey were so backed up.”

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Baby boomers planning to stay in current homes

In contrast to multiple studies which assumed that boomers would want to retire in large numbers to active adult communities across the country, a recent survey by AARP concludes that one-third of respondents plan to age in place rather than downsize to an apartment or move to a seniors-only community. From a BuilderOnline.com story:

The formerly vibrant new-home buyer market of empty-nesters has decided instead to feather their current nests. According to a survey released today by AARP (formerly American Association of Retired Persons), nearly one-third of middle-aged and older Americans say they are making changes to their current homes so that they can live in those homes for longer rather than buy a new house or downsize to an apartment.

"Contrary to general thought, AARP's survey indicates that Americans who are 45-plus are not looking to downsize or leave their current homes as they prepare for or enter retirement," said Elinor Ginzler, AARP senior vice president for livable communities. "They are literally fixing to stay, improving their homes in order to stay there longer and largely overlooking the drop in home values. Call it cocooning or nesting, boomers and their parents are digging in and staying put.”

While psychology is certainly a factor in such decisions (90 percent of Americans aged 60 years and older want to stay in their own homes as long as they can, according to AARP), so is the wobbly economy, which is forcing many to curtail spending on extras. Nearly half (47 percent) of those surveyed said they had postponed travel plans because of the slowing economy; more than 60 percent said they were eating out less and devoting fewer dollars to entertainment...

For more detail on "The Economic Slowdow's Impact on Middle-Aged and Other Americans," visit http://www.aarp.org/research/economy/trends/economy_survey.html.