In a recent article published by Realtor.com, some of the nation’s top real estate professionals provide their insight on the impact retiring babyboomers are having on luxury condominium properties. Here’s what Realtor.com had to say, along with thoughts from Dustin David, Sales Manager at Alteza above the Grand Hyatt in Downtown San Antonio:
It’s the traditional migratory circle of life: Young folks flock to the blazingly bright cities to make their careers and have their kicks; middle-aged peeps move to the burbs, buy homes, and raise their broods; older Americans search out warmer, cheaper, and more water-aerobic-centric climes to make their retirement nests. End of story, right? But hold on. Baby boomers have changed just about everything over the past few decades. Now, as more enter their twilight years, they’re changing the face of American cities, too.
Instead of migrating south en masse to retirement communities in the Sunshine State or the wilds of Arizona, more and more baby boomers—a particularly urban-savvy group of Americans—are moving back to the metro areas they abandoned when they began raising families. And in leaving their suburban homesteads, these empty nesters are redefining the urban centers they now call home. Again,Boomers, defined as those born between 1946 and 1964, are the largest and wealthiest generation to ever retire—a fact hardly lost on savvy developers and businesses. Larger and more expensive city residences chock-full of active senior–friendly amenities, like round-the-clock concierge services, are going up across the country, And more upscale, boomer-targeted shops and restaurants are opening their doors to serve these newly minted urban dwellers.
The numbers are beginning to tell the tale. Only 11% of buyers aged 50 to 59 closed on homes in urban areas and central cities from July 2013 through June 2014, according to a 2015 National Association of Realtors® report. A year later, that percentage had edged up to 13%. At first glance it doesn’t seem to be an overwhelming leap, but when you consider that there are an estimated 74.9 million boomers, even a minority can make an impact.
And it seems that the bigger the city, the bigger the appeal. “If you can afford to live in Manhattan, it’s a great place to be older,” says Jonathan Smoke, realtor.com®‘s chief economist. “You’re not shoveling snow. You can walk or get transportation to any doctor or service you need. And you have a friendly doorman that pays attention to you and acts as an additional caretaker.”
The influx of the older and wiser is particularly pronounced in the most walkable cities and lots of college towns, Smoke says. These areas tend to be full of condos as well as restaurants, shops, and cultural venues such as museums and theaters. They also often have classes and workshops that are popular with retirees. They’re packed with cool places, cool things to see, cool people. And scarcely a shuffleboard court to be found.
“The interesting trend is that the places where many young people want to live are the same places where many retirees want to live,” Smoke says.
Sick of the suburbs
Many of Downtown San Antonio’s agent Dustin David‘s clients are former urbanites who are moving back because they don’t want to spend their golden years maintaining a big house in the boonies. And they crave the mental stimulation found in a City lifestyle.
“Alteza is attracting people from across the country that fall in love with San Antonio,” says David. “With our prime location above the Grand Hyatt and directly on the River Walk, we find our homeowners really enjoy the walkable lifestyle. Hemisfair Park is their new backyard. There’s tons of history and art galleries in town, and the Tobin Center is always hosting some of the biggest names in the entertainment industry. The River Walk has become a fitness trail and the water taxi is a great way to get around town.”
In Chicago, boomers tend to buy up multimillion-dollar condos and single-family houses in the city, preferably near the ballet, opera, and theaters, says luxury real estate broker Sheldon Salnick.
Five years ago, rich suburbanites aged 50 to 70 made up only about 5% of his clientele at Dream Town Realty. Now it’s about 10% to 15%, he says.
What they want
New buildings now offer amenities tailored to this demographic, Salnick says. They include concierge services similar to those offered at hotels. Such services make it easy to arrange for dog walkers, plan parties, or bring in a masseuse after a stressful day on the golf course. San Antonio’s Dustin David adds, “Alteza offers the best of both worlds – from the 25th floor and higher, the building is 100% whole ownership condominiums, but the homeowners have access to the hotel’s StayFit Gym, room service and cash-free charing system. They also have a 24/7 concierge staff on hand.”
“They’re coming from 5,000- to 6,000-square-foot houses. They want space. They want an office. They want room for their [visiting] kids,” Salnick says. “They’re interested in things being done for them.” To cater to these “booming” buyers, urban builders are now putting up more two-bedroom residences with dens and expanded “laundry rooms,” which are generally repurposed into hobby or craft centers or miniature home offices, says Isabell Kerins, a director of product and business development at Irvine, CA–based John Burns Real Estate Consulting.
She’s also seeing more elevators installed, even in residences with just two floors. And builders are bringing back wet bars and showy wine rooms, closets, and nooks, often with glass enclosures and refrigeration, she says.
More services to meet their needs
In Philadelphia, graying new residents are already revitalizing the historic city. More high-end dining, boutiques, and even pop-up shops are catering to these new residents, says Harris Steinberg, executive director of the Lindy Institute for Urban Innovation at Drexel University.
Nationally, more mixed-use developments with housing, businesses, and services such as doctor’s offices are expected to go up in urban areas, says Jean Setzfand, senior vice president of programs at AARP, a Washington, DC–based nonprofit and lobbying group for older Americans. They will be aimed at both older and younger city dwellers who don’t want to drive or hop in an Uber to pick up necessities, get a checkup, or enjoy a night out.
More art galleries, theaters, and other cultural organizations are also expected to sprout up to appeal to these patrons with ample supplies of both leisure time and money.
David is already seeing city leaders creating more open, car-free, and park spaces where residents of all ages can walk, bike, and enjoy warm-weather concerts. It’s a trend already well underway in places like San Antonio.
“Older individuals are stronger voters,” Setzfand says. “That’s why a lot of the local leaders are paying attention” to what they want. And they’re working to change cities to meet those needs.
But these perks come at a familiar price: gentrification. In the oldest parts of Philadelphia, for example, boomers are driving up rental and sale prices, which is in turn driving out some of the younger and existing residents who don’t have such deep pockets, says the Lindy Institute’s Steinberg.
More urban suburbs
Those in the Washington, DC, area who aren’t ready to cut the suburban cord often move to closer-in, walkable suburbs that are more like small cities themselves, like Bethesda or Chevy Chase, MD, says real estate agent Asmeret Demeter-Medhane. There’s an influx of condos going up in these areas a stone’s throw from great restaurants and shopping.
Those buyers, like other urban dwellers, are seeking more amenities says Demeter-Medhane, of Long and Foster Real Estate at Christie’s International. And they’re willing to pay for it—to the tune of $700,000 and up. These price points are causing many to seek secondary destination cities where strong value still exists from condominiums built before the downturn. Alteza in San Antonio is priced from the $470s, a tremendous price advantage that would be difficult to achieve with today’s higher construction costs.
Alteza’s appeal to older buyers includes dramatic floor-to-ceiling glass, open great room floorplans, spectacular city views as well as 24-hour concierge, rooftop pool and spa and a world-class fitness center.
“Ten or 15 years ago, everyone was moving out into the suburbs,” says Demeter-Medhane, who estimates that about a quarter of her clients are now boomers. “And now everyone is moving back in.”
Click here, to read the unedited article written by Clare Trapasso, Realtor.com