Dive Brief:

• Activity in the 55-plus, single-family housing market continues to be a source of optimism for builders, with the National Association of Home Builders' 55+ Housing Market Index edging up eight points to a reading of 67 from the third to the fourth quarter of 2016.

• The association attributed the boost in part to many builders’ hope that the Trump administration will come through on its campaign pledges of deregulation and tax reform. Another major contributor is the potential for this group of buyers to increase dramatically in the coming years as baby boomers age and look to downsize their homes.

• Current and expected single-family sales rose quarter-over-quarter while current multifamily sales slid and expected sales in that category increased for the period.

Dive Insight:

The active adult segment of the 55-plus residential property market is expected to flourish in the coming years as demand in the sector swells. A recent report from the Harvard Joint Center for Housing Studies noted that the number of Americans over the age of 80 is expected to double in the next two decades. Meanwhile, the head of one-third of U.S. households will be older than 65 by 2035.

In a bid to grab a share of this market, builders are targeting the segment with homes featuring smaller footprints, single-level plans and low-maintenance features.

Last summer, D.R. Horton launched its Freedom Homes brand, marketed toward the 55-plus segment, after it noticed that those buyers were purchasing similarly styled homes that the company had intended for its new, entry-level buyers.

The active-adult and first-time buyer segments are expected to be the main drivers behind growth in the housing market this year. Atlanta-based PulteGroup recently reported that its sales in the active-adult market rose 1% in the fourth quarter, while sales to first-time buyers shot up 12% for the period.

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