Upscale downsizing in the real estate market: retirees opting for smaller luxury homes.

• Author: Wallis, Kailee
• Position: SPECIAL SECTION: Building Alaska

Bonnie Swanson, a retired family practice doctor living in a condo in the Westchester Lagoon neighborhood of Anchorage, is a prime example of what upscale downsizing means to the real estate market currently. "We used to live on the Hillside and loved it. But when the kids left, it seemed ridiculous to rattle around in a five-thousand-square-foot house with constant maintenance worries, so we decided to sell," she says. An Anchorage resident for twenty-three years, Swanson weaves the tale of her and her husband's buying journey--from a large house in Westchester Lagoon, to a condo in Bootlegger's Cove, then back to Westchester Lagoon where the couple recently settled in a newly renovated condo. Swanson and her husband are the perfect example of what is becoming a noticeable trend in the real estate market--upscale downsizing.

Noticeable Trend

A trend that is picking up. in the Lower 48 and slowly trickling up to Alaska, as most trends do, is finally becoming noticeable. "They've been mowing lawns for thirty years--they're done. They want the same kind of existence here as you would see in a Phoenix community," says Michael King, a home buying specialist and associate broker at Keller Williams Realty. King cites the generational timeline that we are in as the reason for the trend: the demographic of Baby Boomers (47-65) are reaching retirement age and wanting to downsize from their large family homes, just like Swanson.

On average, the American home has gotten smaller in the last two years, according to the National Association of Home Builders, but downsizing has not fully hit the high-end market yet. However, King says there is a demand for these high-end condo havens.

King explains a recent sale of an upscale condo on 7th Avenue--tucked away in Bootlegger's Cove. The buyer was single, an "empty nester," and ready for something smaller that didn't require a whole lot of upkeep. "My buyer wanted a high level of fit and finish, but with a small footprint," says King. This 1,135-square-foot condo on 7th Avenue sold for $320,000--that's $281 per square foot. To give perspective, homes for sale in East Anchorage run for an average of $151 per square foot. But luxury is what King sold them--the two-bedroom condo has a double-door wine fridge in the kitchen, with quartz countertops and interior cupboard lighting: not exactly the average amenities for condo kitchens in Anchorage.

"The idea of being able to walk to a restaurant, walk to...