Senior Spotlight: Top Motivations For Buyers Aged 55+

Buyers aged 55+ are one of the many active buyer groups today! See what motivations are shared by others and which are unique in our new blog.

Welcome back to the Bobbi Decker Senior Spotlight! As we were reading a recent article from Builder Online regarding the 7 main buyers groups today, we thought you would be interested to see where older adults fall along the spectrum.

According to the article there are 8 main buyer groups, however, the segment defined by foreign buyers is the least engaged due to limiting factors related to COVID-19. The following 7 remaining buyers groups are all actively engaged in the housing market today and are listed as:

1)     First-Time Buyers

2)     Move-Up Buyers

3)     Luxury Buyers

4)     Retiree/55+ Buyers

5)     Investors

6)     Second-Home Buyers

7)     Relocation Buyers

With home sales at their highest levels in 15 years, Builder Online believes that the current housing market momentum is being fueled by 5 motivations shared by ALL 7 buyer groups above. These driving motivations are:

1)     Buying now before prices rise further;

2)     Locking in a mortgage with a historically low interest rate;

3)     Spending the savings they put away during 2020 and 2021 (due to economic closures, lack of travel opportunity and decreased/non-existent commute costs);

4)     Seeking a home that better fits pandemic-induced lifestyle changes; and

5)     The intangible psychological effect of ‘missing out’.

In addition to the above shared motivations of buyers, each segment has some additional driving forces. For retirees and those aged 55+, Builder Online denotes their timeline and pursuits have been impacted by COVID in two main ways. First, older buyers are at a pivotal life transition where they have either just endured a lifestyle change or are about to. According to the article: “Planned retirement, forced retirement, early retirement, chasing grandchildren, or just simply looking for a larger or smaller home are all reasons why this buyer group is shopping.” Such transitions may also fuel moves into single-story residences or into locations closer to family, quality healthcare and retail and dining.

Second, many retirees who had intended to move in 2020 halted their process due to the disproportionate effects of the coronavirus on this generation. That pent-up intention is now coming to actualization with vaccinations available and stock market returns (tied to retirement savings) further motivating moves and new home purchases.

The irony is that while those aged 55+ do represent a notable portion of the active buyer market, they are not playing a dramatic role in increasing inventory.  Just because older adults are buying does not mean that they are selling. Some are unmotivated to sell due to tax reasons, others are keeping their existing home as a rental property or pursuing a second home purchase, while others are selling and buying in the same community (and competing against first-time buyers, move-up buyers or luxury buyers depending on price point and wealth level).

We hope you found these insights as fascinating as we did! For further exploration of this topic, we encourage you to read “The Motivations and Risks Behind Today's Seven Main Home Buyers” HERE.