Agents Beware: Don’t Ignore the Baby Boomer Market

If you’re using these early weeks of the new year to identify weak spots in your business and tweak your marketing, have you considered focusing on a niche? If so, might I interest you in focusing on a group of people that will soon constitute one-half of the U.S. population?

This segment is one that is almost completely ignored by the real estate industry, yet they bring home $2 trillion a year and can take credit for half of all discretionary spending. That’s not all:

  • They control 70 percent of all wealth in this country.
  • They represent half of all credit card use.
  • They own almost 80 percent of all financial assets.
  • They purchase 50 percent of all luxury cars and 73 percent of all hybrid cars sold in the U.S.

“They” are baby boomers – a generation whose birth spanned the years between 1946 and 1964, according to the U.S. Census Bureau. Currently, boomers range in age from 49 to 67 years old.

To make matters even more confusing, this group is further broken down into a smaller category known as the “leading-edge boomer” – those now aged 58 to 67 years old – which constitutes 38,002,000 Americans, according the National Center for Health Statistics.

Why Agents Should Consider the Boomer Niche

The baby boomer generation has turned everything we used to think about the senior housing market upside down. Gone are the days when the real estate agent who specialized in the senior niche sold two types of homes: those of deceased seniors or those of the frail elderly moving into long-term care or other facilities.

Members of the previous generation, the so-called “silent generation,” are now beyond retirement age and represent those we use to think of when we considered the senior real estate niche. Boomers, on the other hand, represent a mixed bag of folks: Some are still raising families, many are still working, and the older members of the generation – who should be in the early stages of retirement – have, for the most part, decided to postpone retirement and continue working.

Aside from the astounding amount of wealth they hold and spend, boomers make up the country’s largest share of homeowners. A whopping 26 million baby boomer homes are expected to be released to the housing market by 2030, according to a 2012 study published by the Bipartisan Policy Center.

Even more intriguing for the real estate industry, however, is that 41 percent of leading-edge boomers – a group with over $500 billion in spending power, according to Brent Green, author of “Marketing to Leading Edge Baby Boomers” – say they will definitely purchase another home.

An additional 45 percent are undecided as to whether they’ll rent or buy, according to a study commissioned by the National Association of Home Builders.

With the housing market reaching a somewhat healthy state, boomers are starting to get off the sidelines and are reconsidering their plans to sell their homes and move on to the next stage of their lives. Many want to move closer to children and grandkids.

Agents considering working with boomers as they buy and sell real estate should understand this segment of the population and what they seek in a new home.

Who are these Boomers?

If you want to work with boomers, and you don’t count yourself among them, the first thing to understand is that most of them are not frail, and they don’t consider themselves elderly.

In fact, boomers are far healthier than their predecessors and don’t take kindly to being talked down to. “They will not tolerate typecasting, stereotypes, pandering or ageism,” says Green.

So, step number one is to throw out all the assumptions you might have about senior citizens. And if you don’t think the real estate industry has assumptions about this generation, read some posts at ActiveRain: “I think the baby boomers are still going to pick up books in the grocery store, but everyone else is looking online first, researching second and then picking up the phone,” posted an agent old enough to know better.

“The agent who uses the technology is the agent who gets the sale. Bottom line, since they’re really going to have to start catering to us twenty-somethings coming into the market,” says a twenty-something agent.

Let’s take a sledgehammer to what is arguably the most common myth about this “older” generation: Boomers are tech averse.

What these agents and others fail to realize is that “tech” didn’t drop from the sky the day they turned old enough to use it.

  • In 1974 – 40 years ago – we had phones in cars.
  • It was boomers who invented the Apple II in the 70s, which ushered in the home computing revolution.
  • The PC was released in 1981. Who do the young whippersnappers of today think were using these computers when they weren’t even a twinkle in our eyes?
  • Today, 53 percent of boomers are on Facebook, according to a recent Nielsen survey, “Introducing Boomers, Marketing’s Most Valuable Generation.”
  • Boomers spend more money on technology than members of Gen X and Gen Y, according to Forrester Research.

So, rid yourself of any assumptions and get to know this segment of the population. To get an even better handle on baby boomers, hang out where they hang out online: 50 is the new 40, Fierce with Age and Boomer Café.

Next, find out what they want in a new home.

What Boomers Want: Location

Again, throw all of your preconceived notions out the window. Despite what you might read online, boomers don’t really care how far away the nearest medical facility is and aren’t at all interested in being located on public transportation lines.

In fact, a full 60 percent of adults 55 years of age and older want a home in close proximity to walking and jogging trails, 54 percent want a park nearby and half find an outdoor pool attractive, according to a new survey published by the National Association of Home Builders (NAHB).

Golf communities have fallen out of favor with today’s seniors, but a fitness center in a community is a hot feature.

The survey also finds that these homebuyers prefer suburban and rural settings to urban living.

Home Features

Are you ready to explode another myth about senior homebuyers? While they overwhelmingly want a single-story home, most of them are not seeking to downsize, according to NAHB Vice President of Survey and Housing Policy Research, Paul Emrath.

“For every age bracket, people want a bigger home than they currently have,” Emrath said. “The degree of upsizing gets very small when you get to the 55-plus market, but I don’t see a lot of evidence of downsizing here,” he added.

Some of the features boomers and seniors are attracted to are the same as those that younger buyers want, including:

  • Energy-efficient appliances.
  • Home offices.
  • Large windows.
  • Tech/media centers.
  • Low-maintenance yards.

From Woodstock to inspiring the World Wide Web, baby boomers have left their mark on the world and will continue to do so. Ignore this huge segment of the population in favor of focusing on young, first-time buyers at your peril.

Comments

Edward Sklar - March 2, 2013 at 3:02 pm

Boomers are in Boynton Beach, Fl. with some of the best priced 55+ resort communities available