Aging Americans are expected to drive more demand for affordable and accessible housing
Housing finance agencies (HFAs) will see favorable impacts from the growth in the US senior population over the next two decades, as aging Americans will have diminished income levels and a need of affordable housing, according to a research report by Moody’s.
Moody’s views HFAs as well positioned to serve what it describes an imminent surge in demand.
Seniors at or below the low-income level will rise to 30 million by 2030, from nearly 26 million in 2010. Expanding loan production for multifamily housing would be a key driver of stable margins and strengthening balance sheets for HFAs.
By 2040, the US senior population is expected to total 80 million, compared to the current 52 million, reaching 22% of the population from 15.4% now.
Moody’s expects the aging US population to drive more demand for affordable and accessible housing given that lower-income renters are at particular risk of financial insecurity when they retire from the workforce. Additionally, many seniors may not have the means to pay for long-term care but will choose instead to age in place.
“The need for greater development of affordable senior housing is positive for HFAs, as such properties typically have high occupancy levels, are often backed by long waiting lists, have lower operating expenses, and are thus less likely to be a drain on asset management,” Moody’s said. “With scarce federal subsidies available to offset tenant rents or to fund the costs of establishing supportive services, HFAs are working with state and local community partnerships, nonprofits, and other advocates of affordable housing on bridging these gaps.”
