Homebuilders pin hopes on retiring Baby Boomers

The current housing-bust survival strategy for many Phoenix-area homebuilders leans heavily on a generation with the word "boom" in its name. With relatively few working-age families willing or able to invest in a new home, older Baby Boomers, many of whom are in retirement or eyeing it, represent the best hope for some local homebuilders to keep busy. Developers have spent the past few decades refining the concept of paradise for a key segment of retirees and empty-nesters who crave a balance of relaxation and excitement. It's called the "active-adult lifestyle." The Valley's dozen active-adult communities under development are designed for them - a fusion of safe, quiet neighborhood and ritzy country club with golf courses, health spas and multipurpose clubhouses offering exercise classes, sports, games, arts, crafts and other activities. As in the rest of the new-home market, sales are down dramatically in active-adult communities since the housing slump began. But Jim Belfiore, a Phoenix-based housing analyst, said the active-adult market has shrunk only half as fast as the rest of the new-home market. The new-home market share belonging to age-restricted communities has doubled since 2005 in metro Phoenix, to 10 percent from 5 percent, Belfiore said. It's a sales trend many builders and housing analysts expect to continue. Baby Boomers age 55 or older, the intended consumers for those homes, are the country's fastest-growing demographic. Already, one out of every four U.S. residents is 55 or older, according to U.S. Census Bureau data from 2009. Builders such as Scottsdale-based Meritage Homes, a relative newcomer to the active-adult market, and veteran active-adult developer Del Webb, now a division of mega-homebuilder PulteGroup, are counting on the growing number of retiring Boomers to drive up age-restricted home sales in Arizona over the next few years, at a time when many younger residents may be struggling to get careers on track, rein in expenses, rebuild damaged credit or move ahead after a foreclosure.

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