Don't Forget the Old Folks
While the Millennial generation is generating a lot ofrnattention, concern, and ink a Freddie Mac executive says it would be wise tornremember that the country on the whole is aging. David Brickman, Executive Vice President of Multifamilyrnbusiness, writes in the company’s Executive Perspective Blog this demographicrnshift will have a lot of repercussions for housing.</p
In 15 years about a quarter of the U.S. population will bernover 50 years of age. The ranks ofrnadults between 65 and 74, driven by the huge baby-boom population, will swellrnto 39 million by 2030, about double the size of that age group in 2010. In another five years the over-80 age grouprnwill reach twice its 2010 size. </p
This will generate explosive growth in those who need housingrnthat provides accessibility, is affordable, and offers support services. Once the wave hits, Brickman says, it willrncontinue for years and we need to start preparing for it and taking advantagernof the opportunities it offers.</p
The article quotes two publications from the Joint Center for HousingrnStudies of Harvard University, The Staternof the Nation’s Housing 2015 and<iHousing Americans Older Adults as to some of the main factors that society mustrnkeep in mind as it thinks about housing needs:</p<ul class="unIndentedList"<liPeople generally are living longer andrnmaintaining active lifestyles as long as they can.</li<liPersons over age 55 account for a quarter ofrnrental housing but accounted for 42 percent of the growth in renters betweenrn2004 and 2014. </li<liMore adults over age 50 live alone and women arernmore likely to do so than men, a likelihood that increases as they age. </li<liMore adults are delaying retirement but theyrnlose earning power over time. An additional 10 million adults 65 or older willrnbe considered low-income in the next 10 years.rnThis will make an already troubling situation more so. One-third of BabyrnBoomers – 20 million – were "cost-burdened" in 2012, spending morernthan 30 percent of their income on housing. For half of them, housing consumed 50rnpercent or more of their income.</li<liSeventy percent of adults over age 65 willrneventually need some form of long term care. </li</ul
Brickman says that being properly housed and cared for is vital to overallrnwell-being, but can be harder to achieve as we age. The above factors andrnothers will influence the types, locations, and amount of housing needed inrncoming years. Right now more needs to be done to insure that proper housing andrncare; that urgency will only grow in coming years. He also notes thatrnMillennials, another huge generation, will start moving into their 50s in thernnext 20 years.</p
While advances in health management can delay seniors’ transition intornalternative housing most of us by age 80 or so will need or want seniorrnhousing. The main property types are:</p<ul class="unIndentedList"<liIndependent living: adults livernon their own but with extra help available such as meal, laundry or cleaningrnservices. </li<liAssisted living: adults stillrnlive on their own but also get help with basic daily activities. </li<liMemory care: addresses thernneeds of seniors with moderate to severe dementia. With an estimated 50 percentrnof persons over age 85 having some level of dementia, demand for this type ofrncare is rising.</li<liSkilled nursing: deliversrnspecialized care to seniors who are unable to care for themselves.</li<liContinuing care retirement communities: offersrna continuum from independent or assisted living through skilled nursing in arnsingle property.</li</ul
Brickman says seniors’ housing can also offer a needed sense of communityrnbut costs run high and the market has focused on higher properties in top-tierrnmarkets which don’t directly benefit households outside of higher incomernbrackets or in smaller markets. Seniors’rnhousing, especially independent and assisted living and memory care, can bernmuch less expensive than full-time home or skilled nursing care and mostrnmarkets could absorb more – particularly for the middle- and lower-incomernlevels. While new construction is critical to keep up with the needs of agingrnAmericans he notes it is also important to make meaningful renovations andrnupdates to keep existing properties in the inventory. </p
He points to his company’s range of lending to support the senior housingrnmarket. “The U.S. population is aging.rnWe’ll need to adjust for this demographic shift by supporting continuedrninnovations and adaptations in housing for our nation’s seniors.”
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