Find Out More About U.S. Active Adult (55+) Community Market Global Growth With Rising CAGR And Forecast Till 2030

Posted by Mrudula Anil Karmarkar on June 13th, 2023

The U.S. active adult (55+) community market size is estimated to reach USD 805.0 billion by 2030, expanding at a CAGR of 4.01% from 2022 to 2030, according to a new report by Grand View Research, Inc. The growing interest of older adults below 65 years of age in a maintenance-free lifestyle, structured activities, socialization, and a sense of community are the major factors driving the market. In addition, retirement not being in the eligibility criteria, and the variety of optional care and support services available at these facilities are the factors boosting the market growth.

An increasing population aged between 55 to 64 years is categorized as active adults seeking a social and friendly environment. According to the U.S. Census Bureau, baby boomers aged between 55 and 73 have brought both challenges and opportunities to the economy, infrastructure, and institutions. Active adult communities are quite similar to any other residential community, apart from their age restrictions, most of them are designed for a low maintenance lifestyle. These communities are mostly built near shopping malls, parks, restaurants, and other places for socializing, as the residents want to live a healthy lifestyle during their final years of retirement. The communities do not provide on-site dining facilities or healthcare services to the residents. The Homeowners Association (HOA) dues of these communities pay for assured communal amenities.

The COVID-19 pandemic resulted in senior living facilities becoming a hub for COVID-19 infections. This resulted in a fall in occupancy in adult community homes. The immediate impact was the drop in revenue of the adult community market, resulting in losses. According to the National Investment Center for Seniors Housing & Care’s MAP Data, the occupancy at retirement centers hit a 16-year low in 2020 due to the pandemic. The pandemic has also resulted in a staffing crisis for the active adult living communities due to restrictions on the workforce and the non-availability of a quality workforce for the amenities, resulting in a challenge in providing the best services for restaurants, clubs, housekeeping, and others. In addition, many elder staff members retired due to the pandemic.

Increasing demand from baby boomers, reduction in the stigma of retiring, and growing interest of investors in senior living facilities are driving the market. Active adult housing is a purpose-built multifamily rental housing for younger seniors and has a heavy emphasis on community space and activities. The living preferences of baby boomers are changing, as this population wants to stay independent and lead an active lifestyle. Thus, post-retirement they prefer to relocate to communities that have residents with shared values and not senior living or assisted living facilities.

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Moreover, for this population, retirement is not about settling down and living the rest of their life following the same routine. They are more willing to explore new things, maintain a social life, and enjoy their life savings. Active adult communities have, thus, become the most suitable option for baby boomers.

U.S. Active Adult (55+) Community Market Report Highlights

• People in the U.S. buying homes at active adult retirement communities look forward to various amenities like sports, restaurants, clubs, & recreational activities among others. Common areas are the most important amenity in demand by seniors because they all have different hobbies and want to spend each day engaged & content
• By gender, women held the maximum share in 2021 attributed to a greater life expectancy for women. The men segment is expected to witness a high CAGR during the forecast period attributed to the postponement of disability to older ages
• Strategic initiatives undertaken by various market players are expected to keep growth prospects upbeat in the following years. For instance, in December 2019, The Villages announced a partnership with the University of Florida, aimed at facilitating advanced healthcare & wellness services for the village community
• There are different types of active adult communities based on the population, including luxury communities, college town & university communities, retirement parks, golf and resort communities, religion-specific communities, active senior communities, single-only communities, and gated communities. The college town and university communities are more preferred among older people who want to continue working
• The increasing number of retirements since the COVID-19 pandemic, growing life expectancy, and rising focus of investors on senior living are factors driving the entry of new players

Active adult communities have gained tremendous market appeal from investors, which is believed to be one of the most opportunistic investments in recent years. According to a recent senior housing & care investor survey, around 22% of respondents believed active adult communities as a profitable investment and the hottest selling property in the senior housing market. Moreover, these properties are specially marketed to younger seniors (55+) and are categorized as a form of lifestyle senior housing. In addition, as these communities are not associated with any type of healthcare component they are growing in popularity with investors among other senior housing product types.

According to mid-year estimates published by the U.S. Census Bureau, the majority of the baby boomers have been turning 65 years of age and by 2030 the remainder will also reach age 65 and will account for approximately 21.0% of the total United States population. Among the senior living market, the active adult community has gained a huge market demand and investor appeal in the last few years. This is attributed to the growing demand for independent and maintenance-free living among the age group of 55 to 64 years.

In the U.S., the active adult community is often referred to by different names. They are termed as lifestyle seniors housing based on the type of population it caters to. Sometimes used in reference to multifamily but most 55+ communities are sold as single-family housing communities.

List of Key Players of the U.S. Active Adult (55+) Community Market

• The Villages
• Pultegroup, Inc.
• Latitude Margaritaville
• Hot Springs Village
• Rossmoor Walnut Creek
• Robson Ranch
• Sun Lakes
• Green Valley