Housing prices may have sunk in 2008-2009, but not low enough for retirees Frank and Leilani Palmieri to afford a modest house in Frank's hometown of Healdsburg, Calif., where they loved the walkable, small-town atmosphere of the wine country hamlet, sparing them life in a suburb elsewhere.
The solution: a low-key senior neighborhood of about 300 homes a mile from Healdsburg's Plaza and located near the Russian River.
They bought a two-bedroom home for under $300,000, much less than similar homes just outside their age-restricted street. The $80-monthly homeowners fee for use of a pool and clubhouse are less than a third of what's charged in nearby condo neighborhoods.
Palmieri, 72, loves the proximity to town activities.
"We have no interest in being isolated in a gated, senior-citizen community where everyone is retired and stays there," he says. "We found a nice place we can afford that's near the cafes, parks, galleries and shops we like," he says.
Palmieri is also able to pick up home renovation jobs around town, spending about three-quarters of his time outside his senior district.
Instead of golf and a fancy dining room, you have a one-story house on a small, low-maintenance lot that you can "lock and leave," to travel, see family or just enjoy dinner and a movie nearby.
Typically called adult neighborhoods or 55-plus communities, these senior housing tracts tend to be hidden gems. Developers instead prefer to advertise their large, pricey senior campuses.
For instance, in the quaint town of Strasburg, Pa., Charter Homes is quietly building a neighborhood of about 100 55-plus homes that back up to the city's historic Main Street. The first batch of one-story, 1,500 square-foot homes have fetched prices in the mid-$200,000 range, with homeowner fees of $72 a month.
"Our concept was to build senior homes near Main Street so we didn't have to create a main street in our development," says Lauren Spamer, Charter Homes Internet marketing manager.
Another good example is Texas Traditions, a group of 40 senior homes close to historic downtown in Georgetown, Texas. At an average 1,400 square feet, the homes sell for about $200,000, with less than $20 in monthly homeowners fees. No pool, no tennis court, no golf course.
"The neighborhood is tidy, calm and seems to attract those less interested in senior-centered social activities," says Cerretha Rose, an agent for Re/Max Austin Associates. Downtown Austin is about 25 miles away.
How much you save by buying or renting an age-restricted home varies by region.
In the Northern California town of Healdsburg, "senior homes have sold for less than similar non-senior homes for the last 15 years, and they tend to sit on the market for longer," says Roberta Jones-Quinn, an agent for Coldwell Banker Giovannoni & Cooper Realty.
A typical two-bedroom, two-bath, 1,200-square-foot house in the 55-plus Riverside neighborhood goes for $300,00-$350,000, according to Multiple Listing Service. A comparable 1,000 square-foot home on a street just outside the 55-plus zone is about $450,000.
In Strasberg, Spamer says the 55-plus homes sit on the market longer and tend to go for less than comparable homes nearby. Buyers of the 55-plus houses frequently take advantage of a discount for paying cash, she notes. In Texas, however, the prices of senior homes and comparable non-senior homes are about equal.
Cost advantages also apply if you choose to rent. In the town of Oceanside near San Diego, Paula Valls, 65, rents a 900-square-foot duplex in the 55-plus Costa Serena neighborhood in close proximity to Mira Costa Community College. Monthly rent for her 30-year-old home is $1,200, compared to $1,700 or more for similar units outside the neighborhood, she says. Homeowner fees are less than $10 a month.
How do these homes compare to other retirement housing options? Real estate experts say that unadorned 55-plus communities will generally cost more than if you stay in the family house and renovate. But when you decide to move closer to children, grandchildren or friends, modest adult neighborhoods can be your smartest financial option.
Cerretha Rose and her colleague Heather Kight, senior real estate specialists in Austin, say that downsizing to a smaller conventional house often requires interior and yard renovations to make it comfortable and requires low maintenance. Senior homes don't require those types of renovations. A conventional condo may be cheaper, but it usually means hundreds of dollars a month in homeowners fees.
You can also move into a senior planned community with on-site facilities, including restaurants, spas, pools, fitness centers, gardens and movie theaters. But prices tend to be steep and homeowners rules fairly strict.
Oakmont senior living communities in California, for instance, charge monthly fees starting at $3,400 for a couple, plus a partially refundable entrance fee starting at about $200,000. On the low side, in Ocala, Fla., the Oak Run gated senior community charges homeowners fees of about $200 a month.
All the on-site amenities in the world - no matter what they cost - would not attract marketing consultant Mike Flores, 60. This year he began researching housing options for his semi-retirement.
"Easy access to the mainstream community, where everybody in town congregates is crucial. Age restricted activities are a big turn-off," he insists. At the same time, "we are looking for the convenience and affordability" of senior neighborhoods, he says.
It can be tough to locate such neighborhoods. Pros advise that you to drive around towns and communities you like, then ask local real estate brokers, senior centers and chambers of commerce if there are any 55-plus areas in or near the town center.
Spamer also suggests searching the Internet for "active adult living," "55+ communities," and "affordable 55+ homes." When you get the results, look for phrases such as "near downtown" or "main street nearby." Avoid places that brag about being "gated" or focus on "amenities."
The good news is as more baby boomers gravitate to in-town senior neighborhoods and tell their friends about it, town planners and real estate developers will notice. The result could be a new category of housing with a dedicated directory to promote it.
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