Story at a glance
- High inflation has caused essentials such as food, gasoline and home utilities to eat into Americans’ paychecks.
- But the economic squeeze in the United States has been felt more acutely by seniors who are on fixed incomes and are looking to age in place.
- Older adults are facing uncertainty amid major life changes, and like millions of others, they are again looking for roommates to split costs.
The increased cost of living is taking its toll on seniors in the United States.
Persistently high inflation has caused essentials such as food, gasoline and home utilities to eat into Americans’ paychecks. And the demand for housing, an issue predating the pandemic, has only increased, making it more difficult to secure affordable living spaces.
But the economic squeeze in the United States has been felt more acutely by seniors who are on fixed incomes and are looking to age in place.
Older adults are facing uncertainty amid major life changes, and like millions of others, they are again looking for roommates to split costs.
Rents grew by nearly 25 percent from pre-pandemic levels, and experts forecasted in late September that rents will outpace inflation, stocks and home values over the next 12 months.
This rent spike is partly driven by the Federal Reserve’s efforts to stanch inflation, which has led to several rate hikes in recent months. These hikes have trickled down into the housing market pushing mortgage rates to 20-year highs and pushing potential homebuyers back into the rental market.
Experts told The Hill skyrocketing housing prices are hitting older adults on fixed incomes especially hard as the cost of common household goods and basic utilities are rising sharply alongside them.
“People are increasingly in life transitions that often mean they have less income, but their housing prices are going up. And that’s not a good combination,” Rodney Harrell, AARP’s Vice President for Family, Home, and Community, told The Hill
Overall, older Americans want to age in place, Harrell added. This could be either in their own home or in a community near family and friends. And many would adjust their living dynamic to do so.
Three-quarters of adults over 50 said in an AARP survey that they either are or would consider living with a family member. More than half of adults over the age of 50 said they would either consider or are currently living with a friend. Another 8 percent said they would consider living with or are currently living with a stranger.
America’s seniors are also contending with significant increases in utilities and basic goods, which could put the monthly costs out of reach for those on fixed incomes even if they find what seems to be an affordable unit.
Inflation, which has remained at 40-year highs for months, rose at a faster rate than expected in September, reaching 8.2 percent in the last 12 months with rising shelter, food and costs of medical care leading the way.
Meanwhile, energy costs are only expected to rise as a recent report warned of a steep increase in energy prices this winter.
These combined factors, along with housing costs, have created an affordability crisis both for those in search of a home, and for those whose homes were made unaffordable by surging expenses.
But experts say there is a hidden inventory of rooms across the country that could transform the housing affordability crisis for seniors.
Some older Americans are turning to home sharing, offering these empty rooms to renters to save money and keep afloat.
Michele Higgs, Community Outreach Coordinator for the Housing Initiative Partnership, a nonprofit developer and housing counseling agency in Montgomery County, Md., told The Hill that house sharing can be a benefit to both the renter and the homeowner renting out their space.
“The thing is, is this is something that can help you because the process is designed to help seniors age in place, number one, help to reduce isolation, and help them to get a little extra income. And so, when it’s presented that way, then it looks appealing,” Higgs said.
Higgs explained that HIP is involved in the house sharing process at every step from counseling a client in need to finding a match to arranging meetings between the renter and homeowner to resolve issues. This is key to building trust between the two parties, she said.
The program could be a major benefit for a person who wants to age in place in their own home in Montgomery County but might otherwise be priced out by high property taxes, Jessica, a Takoma Park, Md., resident who participates as a landlord in the county’s house sharing program, told the Hill.
“For a lot of seniors here on fixed incomes with the higher property taxes, paying their property taxes becomes more and more problematic as they age and retire,” she said.
“So, the home sharing program is attractive because you have somebody who’s contributing to the household income. It makes it possible for people to pay their property taxes and not find themselves essentially priced out of the house they are aging in,” she added.
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Amy Ford, Vice President of the roommate finder and home sharing platform app Silvernest, said the majority of the company’s clients are primarily women in their 50’s, but the service is open to anyone across the U.S. aged 18 or older.
“We’ve had as young as 18 and as old as over 100,” Ford said, adding that applicants can choose the age range of their potential roommate.
Some may not want to live with anyone under twenty after already raising a family, Ford said.
“There’s a significant opportunity to house even a small percentage of people who need affordable places to live through looking at our current existing inventory in kind of a different way.”
“In the 100 largest housing markets, there’s 3.6 million unoccupied rooms in homes owned by older adults. I just think there’s a bit of a mind shift that’s happening about how we utilize the space and how we live with and among others in community, and home sharing certainly checks the box there,” Ford said.
This story was updated on Oct. 28, 2022 at 6:47 P.M.
Published on Oct 27,2022