It’s been a rough couple of days in the retirement real estate market. Fortunately, not all the news was bad, depending on your perspective. Here are few news stories crossing our desk:
– Prices are falling in many active adult communities, which is stimulating sales to at least some degree. According to a report in the Press-Enterprise, Hanley Wood Market Intelligence, a real estate research firm, prices in Del Webb’s Solera Diamond Valley recently ranged from $170,000 to $291,000. Back in January 2008, similar houses were priced from $246,000 to well over $300,000.
– Hanley Wood also points out that active adult developments are selling about two and one-half times the rate than in more mainstream developments. The conclusion that some draw is that reduced prices are attracting buyers who want to strike – while the market is cold.
– Most forecasters believe that nationwide, prices may now be at the “pre-bubble” levels after a spectacular growth and a similarly drastic correction. The important housing price/median income ratio is at its lowest level since the mid-1990’s, while median prices are at about 2003 levels.
– Sunrise Senior Living announced last week it is selling 21 assisted-living facilities. Sunrise is selling because it needs funds to pay down debt.
– KB Home, according to a Reuters report, is being investigated by the U.S. Securities and Exchange Commission over possible accounting and disclosure issues. The home builder has other legal woes as well – homeowners have filed a lawsuit against KB and other parties, saying they falsely inflated selling prices in Nevada and Arizona.
– More people 55+ are moving into active adult communities but still continue to work. For instance, Del Webb reports that 50 percent of residents at its Sun City community near Las Vegas still work full- or part-time. According the company, that’s an 8 percent increase from 10 years prior. The explanation some have for this phenomenon is that baby boomers don’t want to/ are afraid to retire totally, but they do want to improve their lifestyles. Many builders of active adult communities are responding by including flexible layouts that can include home offices.
– Some top active adult communities owned by companies experiencing financial difficulties are being snapped up by stronger outfits. Province, a 2006 Best Active Adult Community in 2006 located near Phoenix, was just acquired by Meritage.
Here is the Topretirements take on these developments.
– Prices are falling – it’s a better time to buy than it was a few years ago
– Some companies are having big troubles. Be careful about who you buy from
– Maybe, just maybe, better times are ahead of us