Sep 19, 2016
Baby Boomers Prop Up Sluggish Lehigh Valley Housing Markethttp://www.mcall.com/business/realestate/mc-lehigh-valley-build-boomers-20160918-story.htm...
When retired teachers Peter and Linda deBeer decided to sell their Long Island home last year they could have bought almost any home in the Lehigh Valley but they chose to move into an Upper Saucon Township development that doesn't allow residents until they're old enough to join AARP.
The deBeers are part of a baby-boom generation that is trading in the giant homes they spent decades paying off in favor of 55-and-older communities that now make up the majority of homes being built in the Lehigh Valley, according to the annual Build LV development report by the Lehigh Valley Planning Commission.
"We gave up a beautiful home that we loved," said Linda deBeer, 64, while in Aruba on the kind of trip she was hesitant to take while maintaining a home. "We were planning to build in Pennsylvania, but this just gave us everything we wanted — to be with people of our age and experience."
As the Valley housing market struggles to find its post-recession footing, the baby-boom bubble appears to be coming at the perfect time. Age-restricted housing made up 6 of the top 10 housing developments in 2015, accounting for nearly 60 percent of all new residential units.
That's a big jump from 2014, when it made up just 20 percent of new units. And 2013, when it accounted for 36 percent.
"The silver tsunami is real and it has arrived," said Becky Bradley, planning commission executive director. "When I looked at the data and saw that more age-restricted housing was approved last year than all other housing combined, I had to look at it twice. It's mind-blowing."
PICTURES: 55 Plus Communities Booming in the Lehigh Valley Bill and Sandie Walker, both 68, downsized from their 4.400 square foot Saucon Valley home to relocate to Traditions of America Saucon Valley. One of the many 55 plus housing community options available in the Lehigh Valley. (Chris Shipley/The Morning Call) But not entirely unexpected. The number of Lehigh Valley residents who were 60 or older increased from 160,005 in 2007 to 193,557 in 2014. They now make up nearly a quarter of the Lehigh Valley population, increasing from nearly 20 percent in just seven years, according to U.S. Census figures.
That corresponds with a similar increase nationally as the baby-boom generation — defined as people born from 1946 to 1964 — enters retirement.
Nathan Jameson, a principal with Pennsylvania's largest senior housing builder, Traditions of America, suggests that while boomers are creating a bigger need for age-restricted housing, a slow recovery from the Great Recession is also to blame.
The numbers certainly support that. Before the housing bubble burst in 2007, Valley developers were building more than 3,000 new homes a year, many of them large single-family homes on giant lots in the suburbs.
By 2009, that plummeted to fewer than 500 a year and it remained there through 2012. New home building increased to 844 in 2013 and then 1,117 in 2014, but even the 1,300 residential units approved in 2015 were well under half the pre-recession totals.
That new age-restricted housing makes up such a large portion of new development is at least in part because new development continues to lag, Jameson said. While credit was perhaps too easy to get before the bubble burst, the pendulum has swung the other way now, often leaving seniors as the most credit-worthy homebuyers in a new post-recession market in which banks are now pickier about who can borrow their money.
Still, there's no denying the fact that its part in the overall development is unprecedented.
"We're at an inflection point in which the baby boomers are driving the housing market," Jameson said. "Not only are they a bigger part of the population, but they're not first-time homebuyers saddled with student loan debt or even move-up buyers whose home equity hasn't recovered. They're creating a demand and we're building as quickly as we can get approvals."
Bill and Sandie Walker certainly fit into that credit-worthy category. Both 68, they sold their 4,400 square-foot Saucon Valley home — complete with an acre of land and a pond full of koi — and in June, moved into a Traditions of America senior development in Upper Saucon Township where the next house is just a few paces from their new home.
They chose a 55-plus community, not for the house but a lifestyle full of clubs, activities and new friends. Bill was a workaholic pharmaceutical company executive and Sandie a former sales representative, but they may be busier now, Sandie Walker said the morning after an unplanned party sprang up in her yard when half the block seemed to congregate there on a warm summer night.
"We could probably go out to dinner every night here if we wanted. We're all baby boomers and we all want the same free and easy lifestyle," Sandie Walker said. "I'm just glad someone figured out what we all wanted and built it."
The unusual thing about this senior housing eruption is there isn't any particular home the boomers are looking for, said Eric McAfee, director of community planning for the Lehigh Valley Planning Commission. Of the top 10 largest developments approved in 2015, six were age-restricted. Two were for apartments and the others were one each for single family homes, twin homes, condominiums and assisted living units.
"It's clearly more about the sociology than the physical form," McAfee said. "Not only are the demographics favoring this, but the taste culture is favoring it."
Sandie Walker doesn't much care what's brought the Lehigh Valley's housing market to this point. She's more focused on the seven-week RV tour she'll soon take of the East Coast, without worrying who will cut the lawn or trim the hedges.
"We're going to lock the door behind us and not worry about anything but our next destination," she said. "We loved our old house but we couldn't live like this. We're free. We're having a blast."