Who is buying land now? – Baby Boomers (Part 2)

Wednesday, October 28th, 2009

This post continues the discussion about Baby Boomers and their propensity to purchase land. We'll continue to look at the factors that influence their decisions and the outlook for land buying habits in the future.

Part of the process of finding the right kind of land for sale is finding the right location. Current trends indicate that Baby Boomers are choosing to buy land that is off the beaten path. Few are able to afford to buy or build Malibu beach houses or Manhattan penthouses. Instead, they are electing to go where property prices and property taxes are low.

But - and this is an important factor - they want many of the amenities that make retirement living relaxing and rewarding. So, for example, they look for land in or near a golf community, or lake land that affords them wonderful opportunities for fishing.

They often opt for land in areas that are going to be developed into private communities, replete with lakes, rivers, recreation centers, and nature trails. Most importantly, they don't want to be "snowbirds," living winters in one area and summers in another. Instead, they want mild temperatures that they can enjoy year-round.

According to a poll commissioned for the National Association of Realtors (NAR), 60% of Boomers want to retire to a rural area or small town. Also, one in four Americans born from 1946 to 1964 own more than one property, according to a survey of nearly 2,000 Boomers by Harris Interactive for NAR.

Boomers have “an almost insatiable desire for real estate,” David Lereah, the NAR’s chief economist said in a statement. They see real estate as “a way to build and protect a nest egg.”   

Why vacant land? “For a lot of people, it’s a dream to have a second home, but they really can’t afford it,” says Peter Francese, founder of American Demographics magazine, who was asked by the NAR to help interpret the survey, “So, they buy a lot.” The July 2008 issue of Business Week reports that “Baby Boomers are retiring at the rate of 10,000 every 24 hours …within 2 decades a record $17 trillion will change hands from corporate pension funds and 401(k) retirement plans into the hands of retirees.”

Tags: baby boomers, nest egg, property price, property tax, real estate, snowbird property