BOOMER Real Estate Guide
Homes, second homes, new homes, planned communities, reduced maintenance, dwindling equity, staying put, financing changes, realistic evaluations – they’re all part of a housing market that has changed.
A lot of boomers are re-entering the housing market with different intentions, expectations and concerns than before, and “if you haven’t been out there for 20 or 30 years, you might think you’ve landed on Mars,” says Laura Lafayette, CEO of the Richmond Association of Realtors.
The housing bubble has burst, the economy is in wobbly recovery, the kids are gone (you hope), retirement is here or near, the old homestead is creaky and worn, and the time has come to reassess and maybe to move. But to borrow the title of a Bob Dylan song, things have changed.
‘GIVE YOURSELF TIME AND BE REALISTIC’
The family home, long seen as a great repository for wealth, probably isn’t worth what it was just six or seven years ago, and the alternatives are pricey. The process of buying and selling homes has adjusted to technology. It may be faster but it’s not necessarily easier. Under new regulations, the mortgaging process has become cumbersome, and while rates are still low, loans may be hard to come by. There are many choices to make, many alternatives to consider.
Realtors and homebuilders start with simple advice for boomer buyers and sellers: Give yourself time and be realistic.
Like much of the country, Richmond has a substantial, diverse graying population, Lafayette says. Some people want to age in place, which means upgrading and modifying the old home. Some want to be in lively live-work-play environments like the Fan, Rocketts Landing or West Broad Village at Short Pump. Richmond’s vibrant, historic neighborhoods are particularly popular with younger boomers, says Cathy Saunders, associate broker with Long and Foster Realtors, while the stylish, modern options offered in newer condominium projects and planned communities appeal to others. Some people want the comfort and support of a progressive care community, while others hope to split time between homes at the river or lake and the city.
Buying a home in your 50s or 60s, Lafayette says, is “as much a lifestyle choice as it is an investment choice.”
Saunders, who holds a senior real estate specialist designation, suggests that prospective home buyers and sellers allow a year to investigate their options, consider their needs and interests, evaluate their finances, and if their current home is a key to getting them into a new residence, to assess its value realistically. If you plan to stay put, upgrading the existing residence, consider refinancing and borrowing at today’s lower rates to pay for the work.
TAKE HOME INSPECTIONS SERIOUSLY
Saunders cautions that buyers today take home inspections seriously, and issues like asbestos, radon and underground oil tanks can drive a home price down or even kill a deal. Sellers might want to address potential problems before putting the house on the market or adjust the price accordingly.
Buyers will find plenty of data online but they shouldn’t assume it’s up-to-date and accurate. Realtors and their clients are likely to interact electronically, so the pace of communication is quicker, Lafayette says. Transactions can be completed, submitted, revised, tracked and executed online.
Banks and mortgage seekers face much more regulation, more detailed contracts than 20 years ago, Lafayette says. Buyers with cash may be tempted to avoid the mortgage mess and buy outright. “Everyone’s situation is different” and a talk with a financial planner may be wise.
Builders are keenly aware of the boomer market, says Tim Parent, president of the Richmond Home Builders Association and executive vice president of Boone Homes. Today’s boomer buyer is likely to have a basic checklist: one-story living space, probably with an upstairs suite for guests and grandkids; low-maintenance or no-maintenance outdoor space.
“People want to be able to walk out the door, go travel for a month and not worry about the house,” Parent said. “They’re busy and they don’t want the house to tie them down.”
LOCATION, LOCATION, LOCATION
The old mantra – location, location, location – still holds, says Jeffrey Kornblau, vice president and chief operating officer at Eagle Construction of Virginia. Being close to dining, entertainment, health care and shopping is important, and people want opportunities for social interaction such as a clubhouse, pool or exercise studio.
Boomers don’t just want to remain physically active, well fed and entertained, they also want educational opportunities, Lafayette says. “Homes near academic institutions are another magnet for this population, and we are fortunate to have VCU [Virginia Commonwealth University], the University of Richmond, the Virginia Museum” of Fine Arts and others like Virginia Union University that draw thoughtful, curious older patrons.
Parent says his company focuses on design and construction – proper grading, quality materials, careful fit and finish – to keep maintenance costs low and help a home retain its value.
It’s an eclectic market, says Kornblau, and to meet varied interests and lifestyles, Eagle is building everything from single-level homes to brownstones with elevators in neighborhoods around town. Lots of storage space is desirable, too, for those heirlooms and keepsakes that seem to follow boomers around.
“A home is still a good investment,” Parent said. “Rates are low, prices are good. Quality homes in good locations will hold their value. Right now, this market is strong, and with the pent-up demand that’s still out there, it should continue.”
“A lot of our homebuyers see this home purchase as their last one,” Kornblau says, “and they want it to be the right place.”
Rob Walker, a writer and editor based in Richmond, is a former editor of Richmond Law magazine and a former Richmond Times-Dispatch reporter.