With greater freedom to choose where and how they want to live, retirees are focusing on making their last home their best home. Modifying their homes to be more age-friendly is important to some, but most have or plan to undertake projects to make their homes more aesthetically appealing, comfortable and functional.
All this activity is helping to propel the home renovation industry, and likely will continue to do so for the rest of the decade.
The numbers speak for themselves. According to a new report, “Home in Retirement: More Freedom, New Choices,” from Merrill Lynch and Age Wave, age 55-plus households account for nearly half of all spending on home renovations annually — roughly $90 billion last year. Between 2003 and 2013, when most Americans were cutting back on home improvement spending, homeowners age 65 and older increased their spending by 26 percent.
And this trend is on an upward trajectory. The report finds that 8 in 10 Americans age 55 and older are homeowners, and 7 in 10 have fully paid off their mortgage. With the aging of the baby boomers and increasing longevity, 65-plus households will grow faster than those in any other age cohort over the next decade, reaching a projected 10.7 million in 2025 — more than four times that of the next largest group.
Among retirees who participated in the study, 64 percent say they are likely to move at least once in retirement, most of them within the same community or state where they live now. More than 4 million moved into a new home last year.
Although preretirees say they expect to downsize to a smaller or more affordable home when they retire, only half of the retirees who had moved did so. In fact, 30 percent moved into a bigger home in order to have more room for visitors or to accommodate a family member who moved in with them.
Just 7 percent had moved into an age-restricted community. Most chose to move to be closer to family, to have a more comfortable house, to live in a safer neighborhood, or to enjoy a more pleasant climate.
Without a mortgage and other midlife financial commitments, retirees who choose not to move see an opportunity to finally realize their dream home — especially those in their 60s and 70s who do not yet have burdensome healthcare expenses. Topping the list of most frequent renovations are kitchen and bath upgrades, creating a home office, adding or updating a recreation room, and redoing bedrooms.
Retirees in the study also are looking for high technology enhancements and amenities, and 8 in 10 are interested in smart home technology to control HVAC systems and appliances. Three-quarters would like health-monitoring technologies for the home, and two-thirds want technologies that will make the home healthier, such as devices to purify the air or help them sleep better. More than half would welcome technologies to help reduce home maintenance chores, such as robot cleaners and heated driveways.
One of the most interesting findings of the study is how people’s attitude toward their homes changes once they pass what the study calls the “Freedom Threshold” — the point at which they are free from a mortgage and having to choose a home that is near to their work or good schools:
“Prior to age 55, more homeowners say the financial value of their home outweighs its emotional value. As people age, however, they are far more likely to say their home’s emotional value is more important than its financial value.”
That emotional value is linked not only to the home’s sense of place and the memories associated with it, but also to its design, to the feeling that it is “the best home” they’ve ever had.
Michael J. Berens is a freelance researcher and writer with more than 30 years of experience in association communication and management. He can be reached at firstname.lastname@example.org.
This article was provide by Multibriefs.