Downsizing by empty nesters helps lift housing market sales
When Sally and Lou Sherfinski decided to downsize and sell the Upper St. Clair home they had lived in for 34 years, it wasn't easy.
It took them two years after their children had moved out of the house before the Sherfinskis were able to make the move.
The couple were trapped in their house for longer than they wanted by the housing recession, which had forced many empty nesters to delay making a move out of concern about depressed prices or difficulty finding a buyer.
The improving housing market has prompted a growing number of empty nesters, faced with the maintenance of larger homes that they don't need after their children have moved out, to downsize and find a place that requires less maintenance.
“Downsize is a trend we are now experiencing in the Pittsburgh region and throughout the nation,” said Howard (Hoddy) Hanna III, CEO and chairman of Hanna Holdings Inc. He credits the strong housing market here and nationally with helping homeowners make that decision.
The Sherfinskis are among the thousands of individuals who over the past 12 months have decided to downsize because they are less worried that their homes will not sell.
Working with Mary Ellen Ulicny of Howard Hanna Real Estate, the Sherfinskis sold their two-story, three-bedroom house in August after locating a unit at Waterdam Farms in North Strabane, which offered not only maintenance-free living but the convenience of having their bedroom, laundry room and kitchen on one level.
John Featherston, CEO of R.I.S. Media, publisher of Real Estate Magazine, has also noticed an increase lately in the number of empty nesters downsizing — many of them the 76.4 million baby boomers born between 1946 and 1964.
“Three to four years ago, empty nesters nationally who wanted to downsize their homes were unable to do so because some were underwater — the mortgage on their home was more than the home's value — while others felt they would not receive adequate payment for their existing home,” he said.
“That reluctance is gone. Home values have appreciated, and with fewer homes on the market, their property values have increased to the extent they feel comfortable now about selling and they are downsizing,” he said.
The real estate market has strengthened. According to the National Association of Realtors, there were 4.128 million single-family houses sold in 2012 compared with 3.787 million in 2011.
The association also said the number of homeowners downsizing made up 25 percent of all homesellers last year, based on sales between July 2011 and June 2012. The previous year, 23 percent of sellers downsized, the realtors group said.
Real estate agent Betsy Witherspoon of Prudential Preferred Realty said a major reason most individuals downsize is to cut the costs they now have for landscaping, utilities and other expenses of living in a larger house. That's an important consideration and one reason she and her partner, Cathy Hall, now find about 20 percent of their current sellers are downsizing.
Bonnie Byrnes of Coldwell Banker Real Estate said families downsizing are usually looking for maintenance-free communities that have master bedrooms on the first level, along with the laundry and kitchen.
She said some of her empty-nester clients move into communities such as Waterdam Farms.
For a monthly fee, the homeowners association provides grass-cutting, landscaping, common area maintenance and snow removal.
Since its opening, 128 units have been sold, and 98 percent of the buyers are empty nesters, Byrnes said.
“I've noticed an increase in empty-nester buyers over the past year, even among parents who still work,” she said.
Among those who downsized during the past 12 months is Barbara Barry, who put her larger Sewickley Heights home on the market and will move into a townhouse that is under construction. Until it's completed, she is renting a smaller single-family home.
“Actually, this is the second time I have downsized,” she said. The first time was after her husband died. She selected a smaller home for her and her three children. Once the last child left for college, she decided to downsize again.
“Homeowners are now able to sell their existing homes at reasonable prices and make a profit that allows them to downsize or relocate near their children,” Paul Emrath, vice president of survey and housing policy research for the National Association of Home Builders, was quoted as saying at a recent NAHB International Builders Show in Las Vegas.
An NAHB recent survey said 68 percent of those 55 to 64 and 69 percent of those older than 65 want a single-family dwelling that eliminates steps and provides a master bedroom on the first level.
Sam Spatter is a staff writer for Trib Total Media.