The Next Housing Crisis: Aging American’s Homes

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There’s another potential housing crisis coming, and this wont be a collapse in home values. The nation is facing a lack of affordable, physically-accessible and well-located homes for American’s aging population – especially those with low incomes, according to a new, study released by the Harvard Joint Center for Housing Studies & AARP Foundation.

“You’ve got a scenario with the large generation we’ve ever had moving into their senior years combined with the fact that longevity is increasing,” says Jonathan Smoke, Chief Economist at Realtor.com, the site of the National Association of Realtors. “And we’re fairly ill-prepared to address the housing needs and challenges of them.”
Time to Head off the Crisis
In 15 years, one in five Americans will be 65 or older. And by 2040, we’ll have 28 million who are 80+.
“If things don’t change, low-income older people will be compromising their well-being in many respects,” says Chris Herbert, acting managing director of the Harvard Joint Center for Housing Studies. “It’s an issue that will affect us all.” Housing, says Vivian Vassallo, Vice President of Housing for AARP Foundation “is a lynchpin for well-being.”
Three of the key problems revealed in the study, Housing America’s Older Adults: Meeting the Needs of an Aging Population:
1. The cost of renting and homeownership is increasing, and the trend shows no sign of reversing.
“Rents and home prices are going up, but incomes for seniors are not rising,” says Smoke. U.S. home values rose 6.5 percent over the past year and rents were up 2.8 percent, according to the real estate research firm Zillow.
High housing costs force millions of low-income older adults to sacrifice spending on other necessities, including food and health care. Severely housing cost-burdened households age 80 and over cut back the most on health care, the study says — spending 59 percent less each month on it than those with affordable housing.
A third of adults 50 and older (and 37 percent of those 80+) already spend more than 30 percent of their income on housing. In some expensive locales things are even worse.
Federally-subsidized rental housing is so scarce, the study says, that few older renters live in such apartments. Nearly two-thirds of eligible renters aged 62 and older don’t receive rental subsidies.
2. Americans want to age in place, but they’re living in the wrong places. Though a vast majority of people in their 50s and 60s say they want to “age in place,” remaining in their current homes as they get older, most older adults live in car-dependent suburbs and rural towns. Those locales won’t be suitable when they stop driving (about 24 percent of households 80+ are carless) and could isolate them.
3. Homes aren’t suited to the physical challenges many older Americans face. Many houses and apartments lack basic accessibility features, preventing older adults with disabilities from living safely and comfortably in their homes.
Only 1 percent of U.S. housing units have all five of what are called “universal design” features: no-step entry; single-floor living; extra-wide doorways and halls; accessible electrical controls and switches and lever-style door and faucet handles. Just 57 percent of homes have more than one of them.
One reason so many homes lack accessibility features: it’s expensive to install them. MarketWatch’s Amy Hoak wrote that making the average home more livable can often cost $70,000 to $100,000.
Thankfully, “there have been some interesting solutions percolating,” says Lisa Marsh Ryerson, President of AARP Foundation. “And more will come down the road.”
What Still Needs to Be Done
Harvard’s Herbert would like to see the federal government offer more rental housing assistance for people over 62 now. And he thinks suburban communities need to alter their zoning rules to allow for more rental construction and accessory dwellings — aka “granny flats” — so elderly parents can live with their adult children.
“I live in Falls Church, Virginia, and we recently approved a large senior assisted living center built in the center of town. Folks tell me that ten years ago, there’s no way the city council would’ve approved it,” says Smoke. “People realize they want seniors to live in our community.”
But can federal, state and local governments really afford to dole out more subsidies and tax credits in today’s budget-crunched era? Herbert concedes that “it’s hard to make a case to expand rental housing assistance given today’s budget.” Not doing so, however, will only put more budgetary pressure on Medicare and Medicaid as older Americans face higher health costs and are forced out of their homes and into long-term care facilities.
Says Smoke: “Washington is not a place where people have been working together on positive solutions over the last few years. What the Harvard and AARP study is doing is shining a light to show that it’s time to work together on these issues.” Expanding the availability of tax credits and financial incentives to make homes more accessible “is a no-brainer,” he says.
He also believes communities will work to make themselves more amenable to older residents. “Addressing the needs of seniors will improve communities for everyone,” says Smoke. “I don’t think you want to be a community that screams: ‘If you’re over 65, you’ll want to leave here.’”
AARP’s Marsh Ryerson is optimistic that the crisis the Harvard study describes will be avoided. “Individuals, government and private organizations know that the problem is real and intend to come together for creative solutions,” she says. “We don’t have a choice. It is our obligation to care for our older population.”

By: Richard Eisenberg, www.nextavenue.org

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