Forget about the millennials. Homebuilders are betting that boomers will be among the biggest buyers of new houses in the next few years. And North Texas residential communities are gearing up for the coming gray wave of residents with new neighborhoods aimed at the 55-plus crowd. These older buyers tend to have higher incomes and are more interested in a new house compared with young, first-time buyers.
One of Dallas-Fort Worth's biggest residential projects — the 2,000-acre Viridian development in Arlington — just announced plans for a 500-home neighborhood for older buyers. The first homes in the 141-acre Viridian Elements neighborhood will be ready later this year. "There is a tsunami of seniors coming in and we didn't have the right product for them," said Robert Kembel, general manager of Viridian. "We are hoping to start selling these houses in the high $200,000s and low $300,000s. "A lot of these older buyers want to downsize from larger and more expensive homes." Viridian, which started in 2011, is home to more than 1,000 residents. "We have a lot of families here and our amenities have been geared toward them," Kembel said. Viridian's new 55-plus community will have a separate neighborhood center with demonstration kitchen, fitness center, pool and game tables and meeting facilities. "I think this will be an absolute winner for us," Kembel said. "A lot of these older buyers will come from Arlington, Hurst, Euless and Bedford and don't want to leave the area."
When McKinney residents Erin and David Bush decided to downsize, they wound up in the Windsong Ranch development in Prosper, where they purchased from builder Grenadier Homes. They went from a three- to a two-bedroom home in Grenadier's Villa townhome project. The 1,301-2,286-square-foot, single-story homes have sold to mostly 55-plus buyers. "My husband and I are older and it was time for us to have something smaller," said Erin Bush. "We had already downsized once. We wanted to get into a nice community but we hadn't been able to find a one-story house." Bush said they were the first buyers in the neighborhood.
Grenadier Homes co-founder Anthony Natale said his firm's Villa townhouses start at less than $300,000 and have been a big hit with older buyers. "One of the reasons they are buying from us is their kids are living in neighborhoods nearby," Natale said. "We have grandparents moving from California or the Northeast and they want to live down here near their kids." While previous generations of aging buyers often headed to separate seniors communities, Natale said his firm's 55-plus buyers don't want that. "There are a larger number of people who want to be mixed in with younger people," he said. "A lot of these 55-and-older people don't consider themselves old and they don't want to be with people all the same age."
Fewer boomer buyers want to relocate to a segregated seniors-only community in the far 'burbs, said Dallas housing analyst Ted Wilson of Residential Strategies. 'There has been a complete rethinking on how to approach these buyers," Wilson said. "It used to be golf courses and million of dollars for amenity centers. Now it's about being close to the grandkids and being part of a bigger community."
With the aging U.S. population, the building industry is banking on thousands of 55-plus buyers in the next decade. The industry index of potential buyers from this demographic is at an all-time high, according to the National Association of Home Builders. Boomers already make up about a third of U.S. homebuyers. And 38 percent of all homebuyers last year were 55 or older, according to the National Association of Realtors. Wilson said a quarter of the D-FW area's population is 50 or older, and this pool of homebuyers will swell by 188,000 in the next five years. "There are amazing stats on the growth of active adult buyers," he said. "That's why the builders are doing it."
One of Texas' largest residential project developers, Dallas-based Hillwood Communities, sold land last year for 600 homes, targeting 55-plus buyers in its Union Park community in Denton County. Builder Del Webb will have the first phase of the project ready this year. Del Webb is a subsidiary of Pulte Group and is the largest builder of 55-plus housing in the country. "Prices will range from high $200,000s to high $300,000s and I expect them to do well," Hillwood Communities CEO Fred Balda said. "Currently, in both our Harvest and Union Park projects (both in Denton County), we are experiencing a sales rate of approximately 20 percent to the empty-nester segment."
Nationwide housing industry demand from 55-plus buyers is at an all-time high.
(National Association of Home Builders)
- Dallas Morning News, March 19, 2018