Editors Note: 50+ Housing e/Source will publish local regional market overviews in each issue. In these overviews, nationally recognized market researchers and industry experts will analyze markets across the country, looking at existing inventory, starts and other activity for both active adult and seniors housing. In addition, the authors will forecast the future of 50+ housing with the market. These market overviews will be housed on the 50+ Housing Channel (www.nahb.org/50pluschannel). Members who feel they can offer this service, or who might be able to work with others who can, should pass that information along to Jeff Jenkins, who is coordinating and scheduling this ongoing feature.

The Cincinnati Metro Area

Home to more than 2 million people, the Cincinnati Metropolitan Statistical Area (MSA) has grown over the last eight years and is expected to continue growing through 2013. Located along the Ohio River in the southwest corner of Ohio, the Cincinnati MSA covers almost 4,400 square miles and is the location for more than eight Fortune 500 headquarters, including The Proctor & Gamble Company, Macy’s Inc., and The Kroger Company. The total labor force exceeds 1.2 million people, with a current unemployment rate estimated at 8.8% ( compared to the U.S. rate of 8.9%).

The Cincinnati MSA consists of Brown, Butler, Clermont, Hamilton, and Warren counties in Ohio; Boone, Bracken, Campbell, Kenton, Gallatin, Grant, and Pendleton counties in Kentucky; and Dearborn, Franklin, and Ohio counties in Indiana. 

Demographic Highlights

Population: The all-age population in the MSA is expected to grow at a slower annual rate (.6%) than the U.S. all-age population, which is expected to grow at an annual rate of 1.0%. The age 55-74 population in the MSA is growing at a slightly faster annual rate (4.1%) than the U.S. rate of 3.9% and, in contrast, the age 75+ population in the MSA is growing at a slightly slower rate than the U.S. rate of .8%.

Households: Similar to the population trends, the number of all-age households in the MSA is expected to grow at a slower annual rate (.4%) than all-age U.S. households, which are expected to grow at an annual rate of .9%. The households age 55-74 in the MSA are growing at a slightly faster annual rate (3.6%) than the U.S. rate of 3.5% and, in contrast, the age 75+ households are not growing at all while the U.S. rate shows .4% growth.

  
Median Household Income: Median household income for all-age households in the MSA is expected to grow at a slightly higher annual rate (2.4%) than the median income for all-age U.S. households, which is expected to grow at an annual rate of 2.2%. The median for households age 55-74 in the MSA is growing at a faster annual rate (3.0%) than the U.S. rate of 2.2%, and the median income for age 75+ households in the MSA is also growing faster than the U.S. rate of 2.9%.  

Employment Highlights

Employment Growth: As illustrated by the graph below, employment growth in the Cincinnati MSA mimics the U.S. growth rate very closely. The first significant deviation appears to be in the first quarter of 2009, which indicates that the Cincinnati MSA began to lose employed individuals at a faster rate than the U.S. average.

Unemployment Rate: The Cincinnati MSA unemployment rate has historically been slightly higher than the U.S. rate until 2008 when the two rates converged. For the year 2008 and the first quarter of 2009, the MSA rate almost matches the U.S. rate.

Housing Highlights

Home Sales: As with many other indicators, the change in single-family home sales is mimicing the national trend. Total sales in the Cincinnati MSA in 2008 were down 13.5% from 2007. If the first quarter is an indicator of 2009 performance, sales will be off even more.

Median Home Sale Price Existing Single-Family: Cincinnati MSA median home sale prices have consistently trailed the U.S. medians by about 35%. While the gap closed somewhat in 2008, first quarter 2009 data indicates a possible return in 2009 to about 35%.

Average Days on the Market: Average days on the market (the time from listing to sale) has been steadily increasing since 2006. In the first quarter of 2009, the average number of days on the market is 90, which represents a 7% increase over 2008 and a 20% increase since 2006. 

Housing Starts (Privately Owned): As in the U.S., housing starts have continued to decline since 2006. The rate of decline for the Cincinnati MSA has tended to mimic the rate for the U.S. as a whole. If first quarter 2009 is any indication of what to expect for the remainder of the year, 2009 starts will be considerably below 2008 levels for both the MSA and the U.S.

Supply Highlights

Lifestyle: The Cincinnati MSA currently has one age-qualified for-sale community, Heritage at Miami Bluffs (see photo of typical elevation, below). This community, established in 2003, has 368 lots and has consistently experienced three to four sales per month until the last 12-18 months. The current economic climate has slowed absorption a bit, but things may be starting to pick up, according to staff. Base prices for homes at Heritage Bluffs run from approximately $230,000 up to $270,000. Heritage at Miami Bluffs is a Drees community.

The Cincinnati MSA has a number of Epcon communities and lifestyle patio home developments offered by all the major builders. According to local builders, sales have been sluggish throughout the last 18 months for most lifestyle products in the middle of the market ($150,000 to $225,000), while products priced below $150,000 and above $250,000 seem to be doing better.

Service-Enriched: The Stratford of Kenwood is the newest service-enriched community to enter the Cincinnati MSA. (See rendering, below). The Stratford is a new 264-residence continuing care retirement community which will include a three-story health center and 17 villas on the campus. The Stratford is expected to open in early 2010.

The Cincinnati MSA currently has 49 independent living communities with more than 5,000 residences. The independent living communities in the MSA have an average occupancy rate of 90.1%. The MSA also has 74 assisted living communities with more than 3,000 residences (average occupancy rate of 93.3%) and 27 memory support communities with almost 600 residences (average occupancy rate of 93.1%). (Data Source for supply: NIC Map)

Forecast for the 50+ Market

Cincinnati MSA households age 55-74 are expected to continue growing through 2013. The growth rate of these target households exceeds the national growth rate of age 55-74 households. while age 75 and older households in the MSA are projected to experience a slight decline. 

Incomes for the age 55-74 households are expected to continue increasing at an annual rate of 3.0%, which also exceeds the national rate (2.2%) and is faster than the income growth for all-age households (2.4%) in the metro area.

Unemployment rates are expected to continue increasing through the end of 2009, but at a rate slower than the first half of 2009. This trend is expected to continue into 2010, with an anticipated reversal in the trend by mid-2011. Existing home sale prices are expected to begin stabilizing by the third quarter in 2010, and the average number of days on the market is expected to start dropping in the second half of 2010.

These trends indicate growing opportunities for new 50+ housing developments in late 2010 to early 201,1 especially in the area of maintenance-free lifestyle communities and age 62+ qualified senior rental housing.  Absorption of age 75+ service-enriched housing will likely continue to be sluggish through 2011. This is an excellent time for builders to start the planning and entitlement process for new product, which they should expect to bring on line in mid 2011. Providers of service-enriched housing for the age 75 and older market should plan for the introduction of new product in late 2011 and early 2012.

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Michael J. Starke is vice president of research for Spectrum Marketing Inc., Hebron, Ky., and Chair of the 50+ Housing Council's Research committee. He has more than 25 years of experience as a consultant in market feasibility analysis, specializing in all sectors of the mature market housing continuum from active adult to skilled nursing. He also serves as an instructor for the NAHB  University of Housing's CAASH certification program..Contact him at MStarke@SpectrumConsults.com. [Return to top]