High End Smaller Homes for Older Adults

A Porche’d out Small Home Housing Market is on Tap in the Near Future

By Mark J. Donovan




As my wife and I were out walking today we discussed our future home requirements and desires. With 2 out of 3 of our children out of college we’re thinking of downsizing our home in the not too distant future. We’d like to buy something smaller than our existing home, however we don’t want to buy a starter home and nor do we want to buy a condo. Unfortunately, at least in our area of the country, those seem to be the only two options for empty nesters that are looking for new home construction.

As we commiserated on this fact, we came to the conclusion that there has to be a market for high end smaller homes for older adults.

With the population aging and the baby boomer generation just starting to get to retirement age, it seems inevitable that smaller homes will be in high demand. My wife and I are hard pressed to believe that most “under-70” baby boomers will seriously consider downsizing into small condo units, the equivalent of what we once called an apartment complex, or into smaller homes with contractor grade flooring, lighting, and appliances. Yet that’s seems to be the only two choices available today for older adults, unless they choose to buy a small home and completely remodel it themselves.

Home builders should seriously take note of the country’s aging population and begin to design and build more new high end smaller homes for this demographic. Effectively this group of home buyers will be looking for the Porche’d out home, both in size and features.

This market opportunity offers several benefits to the builder, real estate agent, and municipality. First, it offers a high margin product to a large population with deep pockets.

High End Smaller Homes for Older Adults

Second, though I’m not a fan of cluster zoning, due to the smaller footprint associated with a compact home, more homes can be built per square acre. This translates into more revenue for the builder, real estate agent, and even for the municipality. Most town or cities would bend over backwards to have more positive cash flow residential property within their borders. With today’s sky-high cost per pupil expenditures for public education, just one child in a home can easily create a negative tax cash flow to the municipality.

As a result, just as municipalities have offered tax breaks to builders for constructing 50+ age condo unit complexes, they should do the same for builders constructing high end smaller homes for older adults in 50+ cluster zones.

With a housing market that has been in decline for about 6 years now, building higher end smaller homes for older adults, maybe just the ticket for turning the market around.

Another benefit to this concept is that the same smaller home designs and floor plans could also be used for the younger and/or less wealthy market segments. To lower the costs for these populations some of the high end internal features could be reduced to “builder’s grade”. The only difference would be that these homes would not be eligible for tax breaks due to the fact that they would more than likely have children in them and as a result be negative tax flows for the community.

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Building smaller homes also offers a couple of “green” advantages too. Energy demands associated with smaller homes are less, and the effective “carbon footprint” for each occupant living in these smaller homes is reduced. Ultimately this translates into annual energy cost savings for the occupants and a better environment for everyone.


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