One of the goals we have as investors is figuring out what's the next "hot trend" before it's hot. We've seen many trends in real estate such as high rise condos, urban living, the suburbs and McMansions, just to name a few. So what are the "hot trends" we see for 2011 and beyond?
Diana's Top Ten:
1. Senior Communities
2. Situational Housing
3. Rural Living
5. Quality is Key
6. NORC – Naturally Occurring Retirement Communities
7. Hot Décor Trends
8. Smart House/Green Homes
9. Tiny Houses
10. Walking Communities
Senior Communities – As the end of the Baby Boomer generation closes in on 55, we see some of the biggest opportunities developing in senior communities. But these won't be the "Sun Cities" of their parents' generation; the massive golf-oriented communities where retired couples go to live out their golden years but often found that after a few years, the communities no longer met their needs. These new 55+ communities will be diverse, smaller-scale and will offer independent/assisted/dementia care options as well as the resort aspect. There will also be "residential share" housing alternatives with universal designs and energy-smart features. Stats show that many seniors plan on working into their 70's and ONE-THIRD of all boomers don't have spouses or children. These seniors are looking for "communities" with more than just recreational services. They want these communities to be FULL-service, with a concierge, life-long learning options, technology, health services and on and on.
Situational Housing – This follows along with the senior communities. As stated above, one-third of all Boomers are single with no children.
So what kind of housing and communities are they looking for? This sector will rely on close friends, not family, as they age. This will be their "chosen family." So, rather than multi-generations sharing a house, there may be "like-minded" friends that share expenses, enjoy companionship and take care of each other. These might be referred to as "Boomer Roomies." Developers will need to design homes in which several adults can live together with large common areas and private quarters.
Rural Living – We know the American landscape has changed over the last 100 years. Look at these stats, according to the US Census Bureau:
1900: 39 percent of people were urban dwellers
1920: 51 percent of people were urban dwellers
1960: 63 percent of people were urban dwellers
1980: 73 percent of people were urban dwellers
2000: 79 percent of people were urban dwellers
But did you know that if you chose to live in a rural environment, there are numerous programs and incentives that can make the process easier? In today's working environment, many people can work remotely and live the country life.
In regions such as Arizona, California, New Mexico and Texas, you may be eligible for a grant that will pay for connecting service lines to a residence. It can also be used to pay utility hook-up fees, install plumbing and related fixtures, i.e., bathroom sinks, showers, tubs etc...
There are loans and many other grants available. To learn more, visit the United States Department of Agriculture Rural Development website; go to the programs and opportunities tab.
Condominiums – Condos here in the states are a bargain right now and in some areas, there are plenty of them. But in the Canadian market, they are a bright spot and it may be a pattern that will persist. "With an astonishing seven out of every ten new homes sold in October '10 being a high-rise condominium suite, high-rise condo sales were up 27 percent over October '09," according to Ontario's Building Industry & Land Development Association (BILD). This is the best October for real estate since 2000 and the second best month for high-rise sales since June 2007 for the city of Toronto. The two main reasons for condominium purchases remain the maintenance-free appeal and lower price tags.
Quality is Key – In a recent survey conducted by John Burns Real Estate Consulting, 24 national builders and a national realtor group, they found interesting data about what consumers want. They found that the location, style of home and design were more important than price. Consumers are looking for quality amenities and they are choosing very carefully. So, if you are doing a fix and flip, make your decisions carefully because the quality will help the resale.
We'll follow up with the last five trends next week.