If you are a Baby Boomer, you are part of a generation that is not only used to indulging itself; you're also hitting your peak earning years. And that means you're ready for the ultimate statement that you've arrived: a big, new custom home. And you won't be alone. Other boomers are right there with you, slicing their pieces of the American Dream pie.

Despite a relatively flat year for new-home growth held back by such problems as lumber and labor shortages, impact fees, and lack of available lots, demand for higher-end custom homes is on the increase. According to a report on BUILDER online, the number of single-family houses selling for $250,000 or more is claiming a bigger share of the market.

The building market has never had more favorable economic indicators all in alignment at the same time. Low interest rates (about 7 percent), high unemployment (lowest in 25 years), low inflation (under 2 percent), and a booming economy are good enough, but add to that the fact that most experts believe the trends will last at least another two to three years.

This spells good news for high-end new housing. According to Eric Belsky, acting executive director of Harvard University's Joint Center for Housing Studies, the demographics suggest that trade-up demand will increase in the next few years. This demand will be fueled by the Baby Boomer market, with more than 30 million entering their 50s by the year 2000, and 40 million by the year 2010.

The National Association of Home Builders (NAHB) considers the ages of 45 to 64 as the peak custom home-buying years. By 2010, the number will be about 78 million. Traditionally, Boomers have been known throughout every industry as "big spenders."

The economy has fostered an approximate 20 percent increase in luxury consumption from 1995 to 1996. Products from luxury cars to cell phones have seen incremental increases in consumption. More people are able to afford luxury homes, according to a study by American Demographics magazine with million-dollar households increasing by 118 percent between 1992 and 1996. Households with incomes of $100,000 or more have grown by 36 percent between 1985 and 1995.

In response to this surge in demand, production builders such as Centex and Pulte are beginning to enter the high-end housing market with the intention of competing on both price and service. Toll Brothers, based in Huntington Valley, Pa., is a luxury production builder with an average of nearly $400,000 per home for a total of more than $1 billion in contracts for 1997.

Published: May 25, 1998

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.