November 7, 2018 — In our younger days we baby boomers did our bit to change the world. Now that most of our working days are behind us, will we revolutionize retirement living too? This article will review how retirement living options have changed since our teen years, and then we will prognosticate on what might be coming down the road, as the last baby boomers reach retirement age (they hit age 65 in 2031), and turn the baton over to Generation X in 2032.
Retirement, back in the day.
Prior to 1960, when Sun City Arizona opened, your retirement living options were pretty simple, probably occurring in stages. You could live in your own home (with a caretaker if you were well off), move in with one of your children, or go to a retirement or nursing home. The latter tended to be pretty bleak- surrounded by a lot of old people, maybe lucky to get your own room. Amenities tended to be limited.
Sun City introduced the active adult community (or 55+ community) to the world, and it has been super successful. To give you an idea, from that single community in 1960 there are now thousands; in fact there are 3,761 communities in our Topretirements database, and at least 80% of those could be classified as 55+ or active adult. We estimate that there are at least 20 active communities in the U.S. with more than 10,000 residents, and 10 or more that have more than 10,000 homes. (see our Active Adult Community Directory) to find them. Some are very luxurious, while at the other end of the spectrum there are inexpensive communities made up of mobile, RV, or manufactured homes. They offer every type of housing style including condos, townhomes, garden homes, and single family dwellings. Some cater to specific groups: for example there are communities devoted to retired military, LGBT, religious/non-profit, and many other types of retirees. Active communities offer a wide range or amenities – big ones tend to have extensive offerings starting with multiple golf courses, marinas, and indoor athletic facilities. Even the smallest ones usually have at least a clubhouse and an outdoor swimming pool, plus some walking trails.
But not everyone likes the idea of living in an active adult or 55+ community. For those who don’t want to live in the home they are in now, here are some other concepts that have developed, although with less success than seen by active adult communities:
– Independent living
– Pocket neighborhoods
– New urban style developments
– Golf cart centric communities
– Communities based on ethnicity
Some prognostications for the future
1. What industry people call where we live. We’ve made this prediction before – at some point the marketing people will wise up and stop calling it senior housing or senior living. Retirement community is better than retirement home, but active adult or 55+ community sounds more appealing.
2. There will never be a one size fits all solution. There will continue to be a multitude of solutions to retirement living because everybody is different. And as Gen X and Xennials begin to retire, there will be even more choices.
3. Most people will stay where they live now. This won’t change: a lot of people like their homes and are very happy to continue living in them. Inertia is another factor – it takes work and planning to move. There will also be plenty of people who will stay in the area they are in now, but will downsize or move to a more age-appropriate home.
4. Intergenerational housing. The oldest form of retirement living is multiple generations living under the same roof, and we think that concept is going to grab a bigger share of the market in the future. The biggest change coming up will be that more people will either modify their homes to provide more privacy and space, or buy a home that is already ready for two sets of occupants. Hit by student debt and soaring home prices in many markets, the children of baby boomers are finding it difficult to buy their own homes. Boomers usually have more equity: many of them are are going to use it to help provide their children a place to live and enjoy being near them too.
As an alternative to what will essentially become two-family homes, in some instances an Accessory Dwelling Unit (ADU) will be built or moved onto the property. One of the big home builders that is putting a toe into this market is Lennar, which introduced its “Next Gen” concept a few years ago. Designed without the formal living and dining rooms that are rarely used these days, these new models use that space to incorporate a suite within the home with kitchen, bedroom, sitting room. There is either a connecting or separate entrance. The concept is built for flexibility, so the 2 living spaces can be used in many different situations: for aging parents, young families, or an adult child.
5. Amenities will continue to change. Golf will continue its trend to be less popular than it was 20 years ago. Pickleball is the amenity of now, with many communities rushing to build new courts dedicated to the sport. Fitness centers with curated classes will be very big. And who knows what is next.
6. Segregation by age will appeal to some but not all. Some people want to be around other people of retirement age – they are tired of noisy kids in the neighborhoods. But many others will find that too antiseptic, wanting to be in a place where there are people of all ages. An ideal solution is a 55+ community within a large all-ages development.
7. Older communities aging out are in trouble. You can see it in older active communities. Their populations have almost completely turned over by now. Prospective new residents see that their new neighbors are 10 or 20 years older, and that the facilities and grounds are long in the tooth. To survive, these communities either have to have visionary leadership that can make them attractive to younger retirees, or they will collapse as property values go down.
8. A sizeable part of the baby boomer population is going to be very hard pressed for money. The folks in this group are either going to have to be very creative about finding a place to live, or they are going to suffer. Shared living arrangements could be one solution, moving to a manufactured home or RV community, which tend to be very inexpensive, is another. The sooner that budget-strapped retirees can reduce their housing costs the better off they will be. Hopefully late term boomers and Generation X retirees, who have had more more time to prepare for a 401k retirement instead of a pension retirement, can have a more self-reliant retirement than many of the oldest baby boomers are experiencing.
9. Communities where cars aren’t necessary. We predict (and hope) that we’ll see more communities being built where it isn’t necessary to own a car. Where homes are built close enough to shopping and downtowns that walking, biking, golf carts, or shuttles are the primary mode of transportation. Cars are banished to back streets, and rented on demand.
10. Vertical active communities. We are not aware of this concept being built yet, but personally find it very appealing. Imagine an apartment building in a walkable part of a city or town where retirees along with some people of all ages live with many of the amenities usually associated with active communities. Those might include an indoor or outdoor swimming pool, fitness center, rooftop pickleball, and activities director. Other amenities could include on-demand transportation, daily lectures, and fitness classes. Perhaps even shuttle access to a country club where golf, tennis, pickleball, and swimming pool can be enjoyed.
What is on your list for the future?
Here is your chance to describe your retirement dream. If you were in charge, what would you build? Where do you think the market for retirement living will head? Will it be different than what you see today? Please share your thoughts in the Comments section below.