With so much being made of fraud within the first-time home buyer tax credit, we hope it’s not a factor in the following item. According to the National Association of Home Builders, increases in age-restricted housing, while small, indicate moderate success of the tax credit. We find it hard to believe so many boomers are buying their first home in age-restricted communities, and David Crowe, NAHB’s chief economist, says it’s the purchase of baby boomers homes by first-time buyers that is in turn really fueling the spike in older communities. Still, we wonder …
The Association’s 55+ Single-Family Housing Market Index shows sales of homes designed for mature consumes increased six points to 21 in the third quarter. Sales increased four points to 19, and expectations for the next six months rose nine points to 32. While these increases show positive growth, the overall effect is small. The index is at the highest level since its inception, but a rating of 50 is needed to indicate a positive response.
“As the home buyer tax credit stimulated sales among first-time buyers and stabilized home prices in many areas, older households were able to sell their existing homes, and pursue a home in a 55-plus community,” Crowe says. “The recent extension and expansion of the tax credit should extend the domino effect from first-time buyers and expand the effect by providing a credit to repeat buyers as well.”
A report earlier this year from NAHB, in conjunction with the MetLife Mature Market Institute, found that while most boomers prefer to age in place, an increasing number are choosing to move into age-restricted housing, especially younger buyers, and female-headed households.