Housing Finance Policy Center
Lunchtime Data Talk
Housing America’s Seniors:
Demand, Supply, and Public Policy
Gary V. Engelhardt, Syracuse University
Christopher Herbert, Joint Center for Housing Studies, Harvard University
Ellen Seidman, Urban Institute
December 17, 2014
Housing America’s Seniors:
Demand, Supply and Public
Policy
Urban Institute
December 17, 2014
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
The Older Population Is on Track to Increase
Dramatically
Population by Age Group (Millions)
70
60
50
40
30
20
10
0
50–64
1990
80 and Over
65–79
2000
2010
2020
2030
2040
Source: US Census Bureau, Decennial Censuses and 2012 National Population Projections (middle series).
3
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
While the Older Population is Growing Very Rapidly,
The Ranks of Younger Adults Will Also Expand
Population by Age Group (Millions)
25
20
15
10
5
0
2012
2040
Source: US Census Bureau, 2012 National Population Projections (middle series).
4
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
By 2010, Communities Across the Country Had High
Concentrations of Older Residents
Share of County Population
Aged 50 and Over (Percent)
Under 25
25–39
40 and Over
Source: JCHS tabulations of US Census Bureau, 2010 Decennial Census.
5
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Most Older Households Live as Couples or On Their
Own
Share of Households by Age Group (Percent)
60
50
40
30
20
10
0
Single Person
Couples without
Children
Families with Children
Other Family
Household Composition
50–59
60–69
70–79
80 and Over
Notes: Families with children include single parents and couples with children under age 18 living at home. Other family includes all households with
two or more related adults. Data exclude non-family households, which account for less than 2 percent of households at age levels shown.
Source: JCHS tabulations of US Census Bureau, 2013 Current Population Survey.
6
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Minorities Will Account for An Increasing Share of The
Population in Coming Years, But Smaller Shares of the
Oldest Individuals
Age 50-64
Age 65-79
Age 80+
2012
2020
2030
2040
2050
Total
2012
2020
2030
2040
2050
60
2012
2020
2030
2040
2050
Minority Population (Percent)
50
40
30
20
10
2012
2020
2030
2040
2050
0
Black
Hispanic
Asian/Other
Source: US Census Bureau, Population Projections, 2012 (middle series).
7
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Older Asians and Hispanics Are Much More Likely to Live
with Relatives as They Age
Share of Population Living in Other Family Members’ Households by Age Group (Percent)
40
35
30
25
20
15
10
5
0
50–54
55–59
White
60–64
Black
65–69
Hispanic
70–74
75–79
80 and
Over
Asian/Other
Notes: Other family members are relatives other than a spouse or partner. Whites, blacks, and Asian/others are non-Hispanic. Hispanics may
be of any race. Data include people living in group quarters.
Source: JCHS tabulations of US Census Bureau, 2012 American Community Survey.
8
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Whites and Blacks Are Much More Likely to Live
in Institutional Settings Late in Life
16
14
12
10
8
6
4
2
0
Population Living in Group Quarters (Percent)
50-54
55-59
All
60-64
White
65-69
Black
70-74
Hispanic
75-79
80-84
85 and
Over
Asian/Other
Note: Group quarters include housing situations where residents receive some form of services, such as assisted living, nursing
homes, group homes, residential treatment facilities, correctional institutions, and school dormitories.
Source: US Census Bureau, American Community Survey, 2012.
9
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Aging Brings Increasing Risks of Disability, With Greater
Need for Accessible Housing and Supportive Services
Share Facing Difficulty by Age Group (Percent)
45
40
35
30
25
20
15
10
5
0
Cognitive
Self-Care
Independent Living
Mobility
Type of Difficulty
50–64
65–79
80 and Over
Source: JCHS tabulations of US Census Bureau, 2012 American Community Survey.
10
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Most Older Households Do, In Fact, Age in Place,
Having Lived in the Same Homes for Decades
Share of Households by Age Group (Percent)
70
60
50
40
30
20
10
0
50–64
80 and Over
65–79
Years in Current Home
Less than 5
5–9
10–19
20 or More
Source: JCHS tabulations of US Department of Housing and Urban Development, 2011 American Housing Survey.
11
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Homeownership Rates Among Households 65 and
Over Remain High, But Dropped Markedly Among 50–
64 Year Olds
Homeownership Rate by Age Group (Percent)
84
82
80
78
76
74
72
70
50–64
80 and Over
65–79
2005
2013
Source: JCHS tabulations of US Census Bureau, Current Population Surveys.
12
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Incomes for Both Owners and Renters Drop with Age,
Leaving High Shares with Very Low Incomes
Median Household Income by Age Group (Thousands of dollars)
80
70
60
50
40
30
20
10
0
50–64
80 and Over
65–79
Age
Owner
Renter
Source: JCHS tabulations of US Census Bureau, 2013 Current Population Survey.
13
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Even Excluding Home Equity, Owners Have
Substantially More Wealth than Renters
Distribution of Net Wealth among Households Aged 50 and Over (Dollars)
Percentile
10th
25th
Median
75th
90th
Total Wealth
38,100
104,500
267,100
694,600
1,888,700
Home Equity
14,000
50,000
111,000
240,000
450,000
Other Assets
4,600
22,900
117,000
496,500
1,491,800
-1,800
60
6,100
27,700
155,700
Owner
Renter
Total Wealth
Notes: Total net wealth includes both financial and nonfinancial assets. Percentiles for each category of wealth are calculated separately; as a
result, percentile values for the components of homeowner wealth do not sum up to total homeowner wealth within each percentile.
Source: JCHS tabulations of Federal Reserve Board, 2010 Survey of Consumer Finances.
14
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Households Are Carrying More Mortgage Debt in Their
Retirement Years Compared to Two Decades Ago
Share of Owners with Mortgage Debt by Age
Group (Percent)
Average Loan-to-Value Ratio for Owners with
Mortgages by Age Group (Percent)
80
70
70
60
60
50
50
40
40
30
30
20
20
10
10
0
0
1992 1998 2004 2007 2010 2013
50–64
1992 1998 2004 2007 2010 2013
65 and Over
50–64
65 and Over
Note: Estimates include only owner households with mortgages on primary residences.
Source: JCHS tabulations of Federal Reserve Board, Surveys of Consumer Finances.
15
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Households Owning Their Homes Outright Are Much
Less Likely to Be Cost Burdened
Share of Households by Age Group (Percent)
70
60
50
40
30
20
10
0
50–64
65–79
Renters
80 and
Over
50–64
80 and
Over
65–79
Owners with Mortgages
Moderately Burdened
50–64
65–79
80 and
Over
Owners without Mortgages
Severely Burdened
Source: JCHS tabulations of US Census Bureau, 2012 American Community Survey.
16
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Rapid Growth in Older Income-Eligible Renters Will Put
Even More Pressure on Housing Assistance Programs
Very Low-Income Renter Households Aged 62 and Over (Millions)
7
6
5
4
3
2
1
0
2003
2007
Assisted
2011
Not Assisted
2020
2030
Projected
Sources: JCHS tabulations of US Department of Housing and Urban Development, Worst Case Needs Reports to Congress, and JCHS 2013
Household Projections.
17
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
HECM Loan Volumes Grew Sharply Through 2009, But
Still Were a Small Share of Market and Have Since
Fallen Off
140
Loan Endorsements (Thousands)
120
100
80
60
40
20
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
0
Federal Fiscal Year
Source: Federal Housing Administration.
18
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
HECM Borrowers Are Much Younger Than In
Earlier Years
Source: CFPB Report to Congress, Figure 13.
19
© PRESIDENT AND FELLOW S OF HARVARD COLLEGE
Gary V. Engelhardt
A Profile of Functional Status and Health
• As individuals age, health and housing decisions become more intertwined
• Research funded by the MacArthur Foundation’s Program on “How Housing
Matters”
• Joint work with Mike Eriksen (Texas Tech) and Nadia Greenhalgh-Stanley (Kent
State)
20
Gary V. Engelhardt
Aging in Place
• Strong desire to age in place
• With aging, there can be a growing mismatch between structural
characteristics and health status
• I discuss
• Health characteristics
• Home modifications
• Senior housing alternatives
• Data drawn from the HRS
21
Gary V. Engelhardt
Background: Health and Retirement Study
•
•
•
•
•
•
Analysis is based on data drawn from the HRS
Sponsored by NIA and SSA
Random sample of over 25,000 Americans 50 and older
A new birth cohort enters every 6 years
Interviewed every 2 years until death
“Exit” interviews
22
Gary V. Engelhardt
Background: Health and Retirement Study
• Detailed questions on
•
•
•
•
•
•
•
•
Demographics
Work and Retirement
Income and Wealth
Housing
Health
Family Structure
Health Care
Bequests
23
Gary V. Engelhardt
Data Source: Health and Retirement Study
• Use data from 2010
• Report presents detailed demographic, income, and wealth profile of
homeowners and renters
• Today’s focus on health and aging in place
24
Gary V. Engelhardt
Homeownership in HRS
Homeowners:
30.8 m
83.3%
Renters:
5.6 m
11.4%
Neither own nor rent:
1.9 m
5.3%
25
Gary V. Engelhardt
Measures of Health and Functional Status
5 Limits to Activities of Daily Life (ADLs)
◦ Eating, Bathing, Dressing, Walking Across a Room, Getting out of Bed
5 Limits to Mobility
◦ Walking Across a Room, 1 Block, and Several Blocks
◦ Climbing 1 Flight or Several Flights of Stairs
Center for Epidemiological Studies (CESD) Depression Score
◦ Ranges from 0 (Not Depressed) to 8 (Extremely Depressed)
Number of Chronic Health Conditions (up to 7 total)
◦ High Blood Pressure, Diabetes, Cancer, Lung Disease, Heart Disease, Stroke,
Psychiatric Problems, and Arthritis
26
Gary V. Engelhardt
Comparison of Health Status
Homeowners
Renters
3.5
2.94
3
2.61
2.31
2.5
1.92
2
1.61
1.34
1.5
1
0.5
0.7
0.36
0
Number of Limits
to ADLs
Number of Limits
to Mobility
CESD Score
Number of Health
Conditions
27
Gary V. Engelhardt
Number of Limits to ADLs by Age
Homeowners
Renters
1.4
1.27
1.2
1
0.87
0.84
0.8
0.72
0.75
0.66
0.64
0.83
0.7
0.58
0.6
0.52
0.45
0.4
0.27
0.31
0.3
0.35
0.2
0
55-59
60-64
65-69
70-74
75-79
80-84
85-89
90+
28
Gary V. Engelhardt
Falls
• Leading Cause of Accidental Death of Elderly
•
An Estimated 10,000 Deaths per year
• Average Medical Cost per Serious Fall of $12,200
• $32B in Health Care Expenditure
29
Gary V. Engelhardt
Fraction with Serious Fall
Homeowners
Renters
25%
20%
15%
10%
5%
0%
65-69
70-74
75-79
80-84
Age Category
85-89
90+
30
Gary V. Engelhardt
Fraction Ever Had a Broken Hip
Homeowners
Renters
30%
25%
20%
15%
10%
5%
0%
65-69
70-74
75-79
80-84
Age Category
85-89
90+
31
Gary V. Engelhardt
Home Safety and Accessibility Features
Homeowners
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Renters
41%
27%
22%
20%
15%
12%
7%
Ramp
18%
6%
Railings
Modifications Grab Bars or
for a
Shower Seat
Wheelchair
4%
Safety Call
System
32
Gary V. Engelhardt
Fraction with Any Safety Feature by Age
Homeowners
Renters
90%
77%
80%
70%
60%
60%
50%
50%
47%
51%
40%
40%
32%
25%
30%
20%
64%
33%
15%14%
10%
0%
65-69
70-74
75-79
80-84
85-89
90+
33
Gary V. Engelhardt
Home Modifications
(1)
(2)
(3)
(4)
(5)
Sample
Number of
Individuals
Home has
Special
Safety
Features
Home Safety
Modification
During Last 2
years
Out-of-Pocket
Housing Mod
Expenses Last
2 Years
Average
Out-of-Pocket
Expenses of
Modifiers*
All 65+ Individuals
38,006,481
31%
13%
7%
$1,344
with 3+ Limits to
ADLs
2,937,489
52%
30%
19%
$1,474
with 3+ Limits to
Mobility
11,017,887
43%
20%
13%
$1,357
34
Gary V. Engelhardt
Senior Housing
• An important market development has been the expansion of “senior
housing” alternatives:
•
•
•
•
Senior apartments
Independent living communities
Assisted living residences
CCRCs
• We use the HRS to profile renters who reside in senior housing
• We use the NIC definitions
35
Gary V. Engelhardt
Percent of Renters Residing in Senior Housing
50
46
45
40
35
35
30
32
31
31
28
23
25
20
33
19
25
23
18
15
10
5
0
36
Gary V. Engelhardt
Distribution of Individuals in Senior Housing
All Senior Housing
Unsubsidized Senior Housing
Subsidized Senior Housing
50
44
45
41
43
40
34
35
30
25
28
24
21
20
15
20
17
14
13
10
5
1
0
37
Gary V. Engelhardt
Percent in Senior Housing
Rent Burdened and Subsidized
% Rent Burdened
% in Subsidized Unit
80
72
70
60
50
53
49
48
47
43
40
40
28
30
20
10
25
17
14
8
10
1
0
38
Gary V. Engelhardt
Looking Forward
•
•
•
•
•
Think of both housing and income solutions to housing problems
Standard metric of housing cost burden: housing cost/income
Attention always given to numerator
But many housing problems stem from inadequate income
Social Security is a “housing policy”
39
Gary V. Engelhardt
Annual Homeownership Rates by Age Group
85
80
Percent
75
70
65
60
1982
1984
1986
1988
1990
1992
1994
35 to 44
1996
1998
Year
45 to 54
2000
2002
55 to 64
2004
2006
2008
2010
2012
65 and older
40
Gary V. Engelhardt
Looking Forward
• Homeownership and living arrangements are very sensitive to Social
Security income
• Bolstering Social Security and other income support, especially for
vulnerable groups, should be a priority going forward
41
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materials related to today’s data talk.