The second quarter of 2013 proved to be positive for almost everyone involved in the real estate industry. Just like reports have shown from other sectors of the industry, the 55+ housing market has seen a drastic increase in builder confidence.
“Builders and developers for the 55+ housing sector are feeling optimistic as they are seeing more consumers return to the marketplace,” said Robert Karen, chairman of NAHB’s 50+ Housing Council and managing member of the Symphony Development Group. “With existing home prices rising, consumers are able to sell their current homes and make the move toward either purchasing a home or renting an apartment that is designed to more specifically suit their lifestyle.”
The Housing Market Index has two separate indices for the 55+ housing market: single-family homes multifamily condominiums. Each index measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor. An index number of 50 or better indicates that more builders view market conditions as good rather than poor.
For single-family homes, the National Association of Home Builders’ (NAHB) most recent Housing Market Index (HMI) shows strong continued improvement in the second quarter of 2013 compared to the same period a year ago. Increasing 24 points to 53, the index showed the highest second quarter number since the index was first measure in 2008. This is also the seventh consecutive quarter of year-over-year improvements in the market. Builder confidence in present sales climbed 24 points to 54 and prospective buyer traffic also rose, moving up 19 points to 38. Expected sales for the next six months rose from 25 points to a 60, showing a strong belief by builders in the continued growth of the market.
“The 55+ HMI for single-family homes almost doubled from a year ago,” said NAHB Chief Economist David Crowe. “Sentiment in other segments of the 55+ market housing was strong as well. This is consistent with the increase in builder confidence we’ve seen in other NAHB surveys recently. At this point, the main challenge for builders in many parts of the country is finding enough buildable lots in desirable locations and workers with the necessary skill set to respond to the increased demand.”
Builder confidence in the 55+ multifamily condo HMI also posted a considerable gain, rising 24 points to 43, which is also the highest second quarter reading since the inception of the index. Just like the single-family survey, the multifamily condo HMI saw all components increase compared to a year ago. Expected sales for the next six months rose 26 points to 46, present sales climbed 26 points to 44 and the traffic of prospective buyers rose 19 points to 38.
Yet another bright spot for the housing industry was seen in the 55+ multifamily rental indices, which also showed strong gains in the second quarter. Present production of properties increased by 19 points to 50 and expected future production saw a rise of 20 points to 52. The current demand for existing rental units climbed 20 points to 62 and future demand for rentals increased by 21 points all the way to 63.
With seven straight quarters of growth, the market for Atlanta active adult homes seems prepared to blaze bright for the rest of this year, into 2014 and beyond.