NC Retirement “Hotspots” Drop by $3 Billion in Residential Sales in Three Years

Press Release
For more information, contact:
Dan Owens, President, National Active Retirement Association (NARA)
C (704)641-1469 * Toll Free (888)742-7362

NC Retirement “Hotspots” Drop by $3 Billion in Residential Sales in Three Years
…Asheville and Wilmington Account for $1.6 Billion

A casualty of the NC housing slowdown is that traditional resort and retirement areas sold 7,000 fewer houses and had almost $3 billion less in sales in 2009 versus 2006, according to a National Active Retirement Association (NARA) analysis of North Carolina Association of Realtors sale statistics.

“Aging boomer and retiree homebuyers flocked to the Asheville, Hendersonville and Brevard mountain area and the Wilmington coastal area in the mid-2000s,” said NARA Executive Director Dan Owens. “The housing downturn in Asheville and Wilmington alone accounted for about a $1.6 billion housing drop - more than half of the total in the 2009 versus 2006 sales analysis.”

NARA compared home sales statistics from 2005-2009 for the following Multiple Listing Service areas: Asheville, Brevard, Hendersonville, Pinehurst and Brunswick, Neuse River, Carteret and Haywood Counties, as well as the Outer Banks. Out of state 55+ buyers have been market drivers in retirement and second home sales in these areas.

In 2006, Wilmington sold a phenomenal $2 billion and Asheville sold $1.13 billion in residential home sales. In 2009, the home sales in Wilmington dropped to $1 billion and in Asheville, home sales dropped to $567 million.

“While not every buyer in these two resort/retirement markets was or is 55+, there is no question that aging boomers, second home buyers and retirees have flocked to these areas and been market drivers in the past,” said Owens. “When you consider all the ancillary economic activity that a home sale creates, the housing downturn has really been an economic setback for these areas. These areas don’t have a tremendous amount of manufacturing,” he added.

Ancillary economic activity on a home sale generally means services provided by mortgage brokers, surveyors, painters and remodelers, landscapers, real estate brokers, inspectors, movers, home improvement and hardware stores, lawyers, title companies, appraisers and more. Often, a home sale stimulates the purchase of furniture, appliances and durable goods.

All of the NC retirement areas analyzed had slight dips in the average home sale price, generally from 5 – 15 percent. But, sales volume generally dropped from 35-50 percent when comparing 2006 to 2009 activity.

“There is no question that the pipeline of retirees has slowed during the housing downturn and recession, but North Carolina as a state has truly not made a deliberate effort to encourage retirees to move to the state,” Owens said. “The state should consider retirement to North Carolina from other states as a bona fide industry and promote it.” Owens noted that the state passed a Certified Retirement Community program into law to promote small retirement towns, but never funded it.

“We have expected out of state aging boomers and retirees to keep coming and keep buying, but we don’t do much as a state to support this multi-billion business that includes homebuilding and real estate development and sales,” Owens said, adding that an added benefit is that once these 55+ transplants move, they don’t clog schools or roads and generally bring higher than average wealth and spending to an area.

Other states – like Texas, Tennessee and Mississippi are much more aggressive in selling those states to relocating retirees through established retirement programs. “They recognize that attracting retirees can inject hundreds of millions into housing and financing-related businesses,” Owens said. “And, these towns get the benefit of retiree’s tax revenue and spending for a number of years,” he added.

The Best and the Worst
*Brevard had the worst drop off in home sales volume – at 57 percent – in 2009 as compared with 2006 activity in the NC retirement areas analyzed. The total value of all 2009 home sales in the mountain communities of Brevard (-64 percent), Haywood Co. (-59 percent) and Hendersonville (-54 percent) all suffered dramatic slowdowns from their 2006 high levels.

*Brunswick County, near Wilmington, had only a 7 percent slowdown in numbers of sales and only a 16 percent dip in the total value of residential sales in 2009 as compared to 2006. Brunswick Co. – on a “retirement alley” between Wilmington and Myrtle Beach, SC – joined the Outer Banks as the two resort/retirement communities to show an increase in total sales from 2008 to 2009. The Outer Banks sales nudged up by 1 percent while Brunswick Co. showed a 13 percent increase in number of sales with only a 5 percent slide in average home price.

“Certain areas of North Carolina - especially certain housing developments – are still getting a good share of relocating folks age 55+ today,” Owens said. He noted that the number one selling subdivision/housing development in the Greater Charlotte area is the 55+ age restricted Sun City Carolina Lakes just a few miles south of Charlotte in Lancaster Co., South Carolina.

“I think the days that we just rest on our laurels and expect retirement in-migration to “just happen” may be over. A lot of states are pursuing this market now and a lot of dollars are obviously at stake as the Baby Boomers age,” he added.

#### 30 ####