Home ownership has long been a major goal for many Americans. But these days, many retirees are swapping home ownership for renting.
Between 2013 and 2023, the number of renters age 65 and older grew by nearly 30%, according to an analysis of US Census Bureau data by Point2Homes. Renting instead of owning often means savings on repairs, property taxes and the burden of maintaining a home — which can be overwhelming for you as an empty nester. Some people sell their homes when they retire, get a small rental unit and invest the money from selling the home to meet future goals, or use it to travel and invest in hobbies.
Renting is no longer just a backup plan
Some people rent out of necessity, but many retirees consider renting even if they own a home. Downsizing often makes more sense when parents are empty nesters, and no longer earning steady incomes. Renting also avoids the headaches of home ownership such as repairs and maintenance. A landlord can do those things for you, and selling your home can give you more financial flexibility.
The extra space in your budget can build your savings, which is especially important when you’re faced with unexpected expenses, like a health scare. Nearly one-third of seniors are struggling to afford housing by 2023, according to a report by Harvard University’s Joint Center for Housing Studies. That means they put more than 30% of their income toward housing costs, leaving little room for error when it comes to other expenses. Renting can help many of those problems, especially for retirees who are downsizing.
The new priority is stability, not just low rent
Renting can provide stability, but it’s important to assess how long you’ll be staying before committing to renting. Some rental units make sense for a short period of time before you need to look for a new one, and if the rent increases too much, you may need to find another place.
While you shouldn’t squeeze yourself into the cheapest apartment you can find, it’s okay to choose a unit that fits your budget and offers mobility. Having a bathroom, kitchen and bedroom in one place may become more important to you as you get older. Elevators, walk-in showers and nearby health care facilities can also become more important as you get deeper into your retirement.
Reading good literature is also important. The lease agreement should outline the renewal process, what you can expect from potential tenants and address other important details. You should also research tenancy protection so you know how to protect yourself if the landlord tries to overstep their boundaries.
Know what help is available before disaster strikes
If you feel overwhelmed by the rental unit, it’s good to know about the programs that can help you. Housing Choice vouchers, public housing and Section 202 supportive housing from the Department of Housing and Urban Development are government programs that work for seniors who need specific assistance. HUD has an additional hub that lists rental assistance programs that can provide you with the funding you need.
Federal programs are a good starting point, but you can also filter your search for state and local options.
Beware of scams. Some scammers target older tenants with fake listings, pressuring them to send deposits immediately and promising guaranteed help. If it sounds too good to be true, it probably is.
