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With the Right Approach, 50+ Holding Up as a Good Market
Even in today’s tough marketplace, active adult housing represents a good opportunity for builders, especially those who invest in models, top quality sales professionals and a club house, according to Janis Ehlers, president of The Ehlers Group, and Margaret Wylde, president of ProMatura Group, who spoke at the International Builders’ Show in Las Vegas in January.
The two shared ProMatura telephone survey results from those who had purchased a home in the last two years in 135 active adult communities around the nation. The surveys were conducted in January.
The survey found that 39% learned about the community in which they bought through word-of-mouth referrals, slightly higher than the 37% who responded to marketing efforts by the community. That finding provides clear evidence, both Ehlers and Wylde agreed, of the importance of customer service and establishing satisfied customers among members of the 50+ age group.
“Communities where there is one-on-one contact with the builder offer an excellent opportunity to forge friendships with customers,” said Ehlers. “Key in on the customer relationships,” she said.
Of those 50+ buyers who discovered their new community by being told about it, 56% were directed to the place they bought by children and other family members and 38% were sent by friends; by comparison, only 6% were led there by Realtors®.
Of those buyers who learned about the community from marketing, newspaper ads and a Web site on the Internet were the most effective approaches, cited by 37.2% and 20.9% of the survey respondents, respectively.
But Ehlers recommended revising marketing plans to better utilize a variety of advertising, publicity and promotional efforts. Additionally, she said, e-marketing techniques offer opportunities to stay connected with prospective 50+ buyers — including e-blasts, e-newsletters and e-correspondence.
Sales representatives strongly influence the purchase decisions of the active adult customer, both Ehlers and Wylde emphasized, and they cited the value of cultivating an expert in-house sales team that receives ongoing training in the skills they need to sell to this market.
On average, in their search for a new home active-adult buyers shopped 4.6 communities and visited the place they eventually bought 3.8 times, the survey showed.
It took an average of 7.8 months for them to make a final decision, with half taking less than six months and half taking longer.
“Builders need to look at their communities through the eyes of their customers,” said Wylde. “Especially when sales are slow, refreshing and rejuvenating signage, landscaping and exteriors can bring new life to a community.”
According to Wylde, keeping current with market conditions is especially important in today’s uncertain economy. Builders need to keep on top of what their prospective customers are willing to pay and gauge the need for incentives. In the survey, 49% said an incentive was offered, and Wylde said that incentives need to be significant in order to be effective, perhaps equivalent to more than 10% of the selling price.
“When prospective buyers may take up to eight months to make their buying decision,” added Ehlers, “marketing strategies need to adapt to their timeframe. Keeping buyers engaged and returning to the community takes a creative commitment.”
Among the attributes that influenced purchase decisions, according to the survey, were:
- Appearance of the grounds (rated an average of 8.7 in importance on a scale of one to 10)
- Appearance of the buildings (8.7)
- Location (8.4)
- Amenities, such as clubhouse, fitness center, golf, pool, walking trails (8.3)
- Reputation (7.9)
- Price range of the homes (7.8)
- Layout of the community relative to the homes and amenities (7.8)
For more information on 50+ resources available from NAHB, e-mail Ann Marie Moriarty, or call her at 800-368-5242 x8350.
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