As we look at the retirement real estate market, particularly the golf community segment, there are many moving parts.  Tonto Verde shares in the difficulty of defining that market and more importantly how to reach that market.  As we define our choice as 4 Star, we have most of the things in place to meet that definition.  Not only are the amenities in place, our setting here between two mountain ranges with essentially 360 degree views provides a difficult to match, let alone exceed, setting.

I think we have defined the outside size of the market but have differences as to what part of that market are candidates for Tonto Verde.  The market is the 10,000 that will turn 65 every day for the next 19 years.  For our purposes I think that the market is the 10,000 per day that turn 55 and the 10,000 that turn 56 and so on through the 65 year olds.  Many, if not most, begin the search for a retirement home before they actually retire.  In our case we considered, and visited; North and South Carolina, Georgia, Florida, Texas, Nevada in addition to Arizona with the thought that there was no timeline but that when we found what we wanted we would buy.  In our case that occurred three years before I retired and we bought in Tonto Verde.

I think it was at the meeting before last when we discussed the income level necessary to be a prospect for Tonto Verde.  The minimum numbers that were tossed out were $200K in income or assets of $2 million.  Those numbers may be right for those in Tonto with one of the higher end homes and a second home elsewhere but for someone that is looking at a townhouse, and it will be their only residence, the numbers are much lower, particularly in the current real estate market.  We are not a Sun City but we are also not Estancia.  So how big is our potential market?  Somewhere in the 3,650,000 each year that are in the age range – something over 36.5 million – are the Tonto Verde prospects.  If only 1% would be prospects the potential is 365,000 floating around out there.  Unfortunately there is no neat way to identify that 1% or whatever the number is.  Someone in the group postulated that our potential market was only about 1,000 per year which I think is conservative to the point of being meaningless.  Was that the case I doubt there would be the population that is now in the Verdes.  We are not going to approach getting 100% of the potential market so we had better hope it is larger.

The difficulty is determining how to reach the market.  As I noted earlier they are not defined but are mixed in with the 36.5 million.  This suggests to me that we have to cast a fairly wide net.  Working the private clubs in the Midwest and West coast can probably yield some prospects.  But even that is very restrictive.  If, as we have discussed, we do the “surge”, with the substantially lowered initiation fee, we may well open private club membership to an entirely new population.  If there are two golfers in the family, the $650.00 monthly dues yields a rather acceptable cost per round and certainly is less than playing daily fee courses.  For instance if the membership only plays 20 rounds for the month – 10 per person, less than 2 ½ rounds each per week – the effective green fee is $32.50. And this is for a 4 Star experience!  The substantially lowered up front cost totally changes the dynamic.  This will be particularly true for the aforementioned prospect where this will be their only residence.

I am sure that most of us that have chosen Tonto Verde would have no problem recommending this area to anyone.  We are in fact he hidden gem in the valley and need only to get the word out.