If you’re interested in making senior citizens your niche market in real estate, there are some things you need to know before promoting your specialty. Read on to learn what senior home buyers are looking for in a home and how to market to them.
There are certain things you need to know if you plan on working with senior home buyers. For example, did you know that most seniors spend 40 to 50 percent of their income on their home? Here are the basics for building a senior niche market:
With the new Frank-Dodd mortgage loan provisions, it’s near impossible for retirees to qualify for a loan. This is because the new rules are based on the debt to income ratio, and if your clients are retired and have no current income, they may not qualify—even if they do have adequate savings. Even with social security, their income may not qualify them for much money in advance. However, if your clients are 62 or older, they can qualify for a reverse mortgage.
There are tax deductions only homeowners can take advantage of, so make sure your clients are aware of these. Some of these perks include mortgage interest deductions, property tax deductions, and capital gains exclusion. In fact, if your clients are selling their home to move into a retirement community, they may not have to pay taxes on the sale provided they lived there for longer than five years.
According to an infographic by Placester, 15 percent of homebuyers ages 67 to 87 say their primary reason for buying is that they want a smaller home. In fact, on average, homebuyers 67 and older reduced the size of their home by 200 square feet. Furthermore, 76 percent of buyers age 88 and up purchased a home that was 2,000 square feet or smaller.
Suggest that your clients’ new home be located close to public transportation. Whether they become physically unable to drive or have their driver’s licenses revoked, accessible public transportation will become increasingly important with time.
It’s very likely that your senior clients will be looking at homes located near family members. Although they may consider making a drastic change to celebrate retirement, remind them that many seniors end up making a second move to live near their families just a few years thereafter.
Additionally, ensure your clients see homes that are located relatively close to necessities like the grocery store, pharmacy, hospital, etc.
When it comes to amenities, think accessibility. Remind your clients they may want to forgo homes with stairs and opt for single story floor plans instead. Also encourage them to keep an eye out for level driveways and stair-less entries. Other amenities to consider include non-slip tile floors, levered door handles, shelves in the bathtub, bathroom grab bars, and low cupboard space.
The stereotype that old people can be stubborn rings true when it comes to the purchase of real estate. According to Placester, 54 percent of buyers 67-87 made no compromise on the home they purchased. They can also be quite the low-ballers: senior buyers were the most likely of any age group to pay less than 90 percent of the asking price.
When it comes to finding and targeting senior home buyers and sellers, go old-school. Focus on outbound, paper marketing and use flyers, brochures, or postcards to grab their attention. Most senior home buyers and sellers aren’t online, so this isn’t the best place to reach them. Instead, door-knock areas where senior citizens live and hand them your contact information.
There are many resources that can help you in your journey to make senior citizens your niche market. Check out SeniorsRealEstate.com, an official subsidiary of the National Association of Realtors. Here, you can learn how to become a designated Seniors Real Estate Specialist, or SRES®. They also offer customizable marketing materials, a professional bi-monthly printed newsletter, a monthly consumer newsletter, and monthly webinars.