[quote=temeculaguy] . . . The other element of a downtown residence is that it is close to work, retired baby boomers (who will be 70 in 2016-2018) are not going to pay 3x the price per square foot to be close to a job they retired from, that’s just stupid. Plus the stores and restaurants are more expensive. It’s noisy, crowded and busy, the exact opposite of what old people like. 70 year old people don’t hang out in gas lamp bars, dine in stylish cafe’s and shop the hip stores. They play golf, travel in motor homes, hang out with other old people and try to live as nicely as they can afford. $800 hoa’s of downtown condos are not real popular with the fixed income crowd. So places like Phoenix, Oregon, Idaho, Palm Springs or even Rancho Bernardo are more appealing to retirees. It has what they want. . . [/quote]
TG, I tend to agree with your statement here as it applies to baby boomers. But I don’t agree that those locales you mentioned in your last sentence is where they’re necessarily headed. Perhaps those areas are where the current longtime retirees have settled but I don’t see the majority of baby boomers still in the pipeline retiring to those places. Many current longtime retirees have defined-benefit pensions and have only owned 1-2 homes their entire lives, often in modest neighborhoods for which they originally paid $4K to $17K. Thus, they lived their lives conservatively and were risk-averse. Most were unsophisticated “investors” if they invested at all. Their (female) spouses often have never worked and have no SS benefits in their own right. For the most part, their incomes are fixed in the $850 – $3500 mo (latter are dbl dippers) range. They often bought their RV’s when gas was much cheaper than it is today. These RV’s are not resalable except for salvage value (even if in good condition) because there are way too many of these unused and available. The market has been down for them for years due to gas prices (most only get 5-8 mpg).
I recently returned from a 4600-mile road trip. On it, we toured nearly the entire state of Colorado. Everywhere we stopped and stayed, the traveling “boomer set” was out en masse. Most were searching for retirement-home deals in expensive mtn resort areas. Some were locals leaving to view and possibly pick up rental properties (to obtain a retirement income stream) in hard-hit states such as NV, AZ and FL. NONE were traveling in RV’s. The preferred mode of travel was actually either a Jeep or motorcycle. Many couples were traveling together on Honda Interstates or other touring bikes with luggage. Others were traveling in luxury cars and SUVs. The method of preferred lodging was staying all in the same chain or Best Western for points redeemable for free rooms, as we were. This is cheaper than RV gas or a timeshare and many of these properties are 3 star and up. Most stated they did or would be staying with relatives at some point in their travels.
If a soon-to-be-retiree today has a choice, why would they move from SD to the triple-digit heat to an inferior place like Yuma (for more than a week to launch their boat)? They can actually live in a more desirable place (city, semi-rural or rural) because they don’t need the square footage anymore. Often, the “suburban” property they owned and resided in pre-retirement WAS located in a coastal “choice area” but was too large with a larger labor-intensive lot. Once they sell out and dump these responsibilities, the world is their oyster. With prices way down even in resort areas such as South Lake Tahoe, boomers have many housing choices. And this generation is not afraid of termites and rehab work, either. They can even retire in a fixer in an area they have always coveted, such as in a crumbling Pacifica (SM Co) mid-century modern built high over a lot backed by miles of protected wildlife habitat with a “peek” whitewater view of the craggy coastline below. I personally know two over-55 boomers who recently bought older homes with flat acreage in East County (SD) in order to eventually have a small farm and become self-sufficient. One lot has a producing citrus orchard. Both are still working but will retire in 3-8 years. Different strokes for different folks.
I agree that the city retirees will likely be ones who have lived there all of their lives and that the majority of boomers will not want to pay exorbitant HOA fees, nor would care about a doorman, valet and other amenities when they are “retired.”
Most boomers are also in better health than their predecessors and will not be limited to RV Parks at Lake Mead for “retirement locales” like the WW-II and “Greatest Generation” set was. They will not be spreading out card tables on artificial grass and playing Bridge with their mobile home park neighbors, lol. Today’s boomers actually have smartphones, wireless notebook computers and still have their finger in the pot – as a “consultant.”
Even though many boomers’ retirement accts have taking a few beatings from the stock market (and also rallied a few times) in recent years, they’re still likely worth more than what they and their employers’ invested in it. I don’t think the (over 50 at the time) boomer crowd were the major consumers of NINJA loans, HELOCs, and serial cash-out refi. Although I can’t find any data on this yet, I think the vast majority of the participants in these schemes were Gen X or very tail-end boomers (born >= 1960). What I’m trying to say here is that boomers often have sleeping assets such as high-equity or free-and-clear propertie(s), retirement accts they have been feeding for decades, defined benefit plans, partnership and other passive income, inheritances, etc. The reason they’re shell-shocked and some of the 60+ crowd is delaying retirement a few years is because they’re not quite ready to “downsize their lifestyle” to retire (still trying to pay off vehicles and mortgages). Even though it may not be in defined benefit pensions, today’s boomers have more net worth than the seniors of yesteryear.
Don’t confuse previous generations of “old people” with the “old people” coming of age today. They are apples and oranges. I for one, endeavor to keep myself as fit as possible and NOT be dependent on prescription drugs of any kind for the long term. Instead, I am educating myself on homeopathic remedies. And I am one of many. Just go to any gym in SD County and the majority working out there regularly will be early-mid boomers 🙂
