High home prices make it more difficult for empty nesters to leave
Empty nesters both contribute to and cope with low metro Denver housing inventory.
August 31, 2017
by Molly Armbrister Reporter – Denver Business Journal
Parents downsizing their homes after their children move out have been a market factor in residential real estate for decades. And in Denver’s current real estate climate, the prospect is more difficult than it used to be, and the difficulty some face trying to get into a smaller home has its own ripple effects on the market.
Housing inventory in metro Denver is tight, and the market for condos, long a favorite of empty nesters, is even more restricted. In July, 1,649 condos were listed, according to data from the Denver Metro Association of Realtors. Nearly half of those — 808 condos — are priced at $400,000 or more, higher than the $324,000 average price of a metro Denver condo.
Higher home prices also make it difficult for empty nesters, who are often either already retired or headed in that direction. And with condos specifically, most of the new product that is being built is in the luxury market.
Empty nesters like condos because of their size and the fact that there are no yards or home exteriors to maintain, said Mark Trenka, a Denver real estate broker who specializes in condos.
But the lack of supply makes it hard for them to find a place to go once the kids leave, so they’re staying in their existing homes longer – which in turn constricts supply of larger homes that younger families with children might seek.
Condos are especially difficult to find in the suburbs, where many empty nesters live, and in general they want to stay in the same area when they downsize, Trenka said.
That’s not to say empty nesters only want condos. Single-story patio homes and townhomes are also popular among those looking for a change after their kids leave home and offer an alternative to condos. But with homes of all kinds in short supply, those homes can also be hard to find, Trenka said.
But some developers see the potential in these kinds of homes and have found places to build them.
Boulder Creek Neighborhoods builds low-maintenance homes in northern suburbs of Denver, as well as Stapleton and Aurora. The company has been building homes like these and marketing them as low-maintenance alternatives that free residents to travel and explore their passions.
A new development near Sloan’s Lake called Perry Row has also gained traction with the empty nester set, said Deviree Vallejo, a Kentwood City Properties broker who lists townhomes at Perry Row.
The four-phase project will eventually include 64 homes, she said, and 45 of them have been made available for purchase so far. Of those, 35 are under contract, and “quite a few” of those are being purchased by empty nesters.
Perry Row townhomes range in price from $450,000 to $850,000 and in size from 1,410 to 2,198 square feet, which for some buyers means a home that is half the size of the home they’re leaving.
In addition to the “lock and leave” aspect of the townhomes, which decreases property maintenance and makes travel easier, Vallejo said, Perry Row is located on the former St. Anthony’s Hospital redevelopment site, which is a popular neighborhood with a growing number of retailers and restaurants within walking distance. Sloan’s Lake is just north of Perry Row.
About 65 percent of the buyers so far at Perry Row are local, but retirees are increasingly making Denver their home as they follow their children who have moved here for work. Some buy properties in Denver as second homes and spend the winter in a warmer climate, Vallejo said.