America’s Aging Population Needs Somewhere To Live
America’s population is aging, and our older generations desperately need new housing and care options.
America Is Getting Old
The USA is about to celebrate its 250th birthday. A notable turning point for many great empires in history.
This year, the oldest boomers are turning 80. According to the Census Bureau 11 states have seen the number of older adults surpass the number of children. One in five Americans will be 65 or older within the next five years according to S&P Global. The median age in America is now over 39 years old.
That’s in stark contrast to many other countries which boast a young and growing population. This has many ramifications for the country as a whole, the economy, and its future. As well as for individuals.
Housing & Healthcare Issues
Healthcare has long been a controversial political and financial issue in America. It certainly doesn’t appear to be getting cheaper. Most haven’t saved enough to cover the looming costs of aging. While the government is also debating how much it will cut back government provided or subsidized healthcare for seniors and others.
Healthcare options close to where our seniors currently reside may also have changed, and become lower quality or fewer as well.
Aging in place, at home, used to be a much more common thing. It is a lot less attractive today. Homeowners may have equity, thanks to rising home prices. Yet, the costs of holding onto and maintaining those homes has dramatically increased since COVID. Homeowners insurance, property taxes, association fees, mortgage interest rates, utility bills, and repair costs are all up. That’s in addition to high inflation on healthcare, food, and everyday household goods.
Meanwhile these senior homeowners may also be finding the neighborhoods they’ve long lived in have substantially deteriorated. They are less well kept, and crime is up, a lot.
Gone are the days when a home stayed in a family for generations. They just don’t build them that well anymore for a start. Today’s younger generations also want to live in different areas, and crave newer and more modern homes. They don’t want mom and dad’s uncool hand me downs.
At the same time, new data shows the extreme rise in memory and other health ailments that are showing up with age. Web MD recently reported that having lived close to a golf course is showing a 126% greater likelihood of residents developing Parkinson’s Disease. That’s a lot of people.
A Neglected Real Estate Sector
Senior housing solutions are rapidly growing in demand. While supply has been languishing since COVID.
Senior Housing News reports a shortfall in senior housing units of almost 600,000 units in the next five years. Occupancy rates are now up to 89% and likely growing strong.
COVID gutted this sector. While also changing the dynamics of multifamily housing for the worse for many landlords over the past five years.
Now we are looking at a ripe market opportunity. A sector which seems to have hit bottom, and is primed for growth.
There are several ways for investors to participate in this. Building new construction is one. Especially where there are local incentives.
Others may choose to acquire existing underperforming senior and assisted living centers, and inject new cash and better operating efficiency.
In some cases, repurposing existing multifamily housing for seniors may be a highly profitable choice. One that offers passive income for your own retirement, and value add gains, while doing something good.
