The housing crisis has kept thousands of older Americans who need support and care from moving into retirement communities or assisted-living centers, effectively stranding them in their own homes.
Without selling their houses or condominiums, many cannot buy into retirement homes that require a payment of $100,000 to $500,000 just to move in. So they are scratching themselves off waiting lists, canceling plans with packing services and staying put, in houses that fit well 30 years ago, but over the years have become lonely, too large or too treacherous to navigate.
“It is part of the hidden problem of the recession,” said Larry Minnix, president of the American Association of Homes and Services for the Aging. “Every neighborhood, every family’s got them.”
Facilities that have watched their waiting lists wither and their occupancy rates fall in the last year are now scrambling to bring people through their doors. Some assisted-living centers have called in real estate agents to teach prospective residents about online advertising and how to clean and preen their homes for showings. Others have set up programs with banks to provide bridge loans to homeowners, or are discounting apartments and offering low-interest loans.
The Cedar Community, which provides a range of housing for the elderly in West Bend, Wis., has seen independent-living occupancy rates drop by 4 percent this year. There were so many people waiting for their homes to sell that the facility decided, in some cases, to let new residents pay month-to-month until they could unload their houses and use the proceeds on the facility’s entry deposit.
“We’ve never done that before,” said Tracey MacGregor, a spokeswoman at Cedar Community.
But for people like Ruth Scher, 85, selling their home is a critical first step before moving on, or moving anywhere. Ms. Scher put her two-bedroom condominium in Delray Beach, Fla., on the market last year, but no one has made an offer.
In the 34 years since she moved to South Florida, Ms. Scher’s husband has died, the siblings who moved south from New York to join her have died, and her friends have moved away. She is recovering from a fall that broke her clavicle and suffers from arthritis in one shoulder, and she says it is time to move back.
“It’s lonesome,” Ms. Scher said. “So many other people have passed away or moved away. It’s very lonely. The children would love me to come up and I would love to, but I just can’t sell.”
Ms. Scher hoped to move to a retirement community in Cornwall, N.Y., where she has friends. But in the year her home sat on the market, she could not even find a broker willing to sell the property, she said. She finally de-listed her condominium.
“They tell you, ‘We’re sorry, we can’t get any people to come and look,’ ” Ms. Scher said. “If I can’t sell here, I can’t go nowhere.”
There is no way to say how many older Americans are in similar straits, as no statistics track how many of America’s 4.27 million unsold homes are owned by people 65 or older. But industry groups and administrators at retirement homes call the problem a growing one, which worsened as the financial crisis spread from real estate to lending markets. It has been felt worst in regions hit hardest by the housing bust.
“It remains to be seen whether we have a short-term stress, or whether we’re facing a crisis,” said Mr. Minnix, of the Association of Homes and Services for the Aging. “We’re into brand new territory here. It is deeper and potentially broader.”
Across the country, occupancy rates for independent and assisted-living facilities have fallen slightly in the last year, by about 2 percent through the middle of 2008, according to the National Investment Center for the Seniors Housing and Care Industry.
But the problem is playing out acutely in hard-hit areas like Florida, where the vacancy rate at some facilities is up 20 percent to 30 percent over last year, said Paul Williams, director of government relations for the Assisted Living Federation of America. At Luther Manor, a retiree community in Milwaukee, the number of residents moving into independent living has dropped 20 percent this year. In southern Ohio, 65 percent of the people who visited the Bristol Village retirement community this year said they could not buy a unit because their homes were still hanging around their necks.
For these businesses, each occupied room generates thousands of dollars each year. Retirement condos charge monthly fees ranging from a few hundred dollars to $5,000, while the average price for private-pay care in assisted living is $3,013 per month, or $36,156 per year, according to a MetLife study.
At the Crosby Commons assisted-living center in Shelton, Conn., where waiting lists that once ran two years or more have shrunk to six months, some residents who moved before selling their homes are spending through their savings as they wait, said Lois Poultney, the center’s director. One resident had to move from Crosby’s free-market homes to its subsidized rent-controlled apartments, Ms. Poultney said.
“I’m hearing it over and over again: ‘Mom needs to sell her house before she can afford to move in,’ ” she said.
There are signs some families and retirees are turning to adult day care services as a stopgap. Providers say their business has spiked as people look for an alternative to continuing care or home aides to provide food, companionship and therapeutic services. But Mr. Williams of the Assisted Living Federation said that people who need more day-to-day care, those who have trouble getting up stairs or who need someone to check on them, were taking a risk by staying at home.
“When they’re coming in at 85, they’re coming in very frail and needing services,” he said. “They can’t wait this out. They need the care when they need the care. That’s the scary part. You have people putting it off when they need care right now.”
For Katherine Styberg, 84, that moment of realization came when she slipped on a patch of ice in February and fractured a vertebra. She has to use a cane when she walks now, and she says she has been thinking about how she lives alone, and if she fell in her two-bedroom condominium in Milwaukee, no one could catch her or help her up.
The real estate broker calls Ms. Styberg a day before bringing potential buyers to see her apartment, and a few have come to look around, but no one has made an offer yet.
As parents linger in their homes, they say their children start to worry. Some adult children are even facing financial hardships if they cannot sell their parents’ homes.
In April, Ruth Swessel, 84, of Milwaukee, had a stroke that aggravated the effects of her aging, leaving her unable to follow “Meet the Press” or read the political magazines she once loved. Her daughter, Laura Westling, had to put her into skilled care, and the family began the process of selling Ms. Swessel’s house to pay for the facility’s $60,000 annual cost.
The house has been sitting on the market since the summer, and Ms. Swessel’s family has lowered the price twice, to $174,500 from $189,900, but they have not been able to close a deal. Her children are spending her investments to pay for her care, but Ms. Westling said they did not know what they would do once that money ran out.
“It’s not easy,” she said.
As stock markets have slid in the last year, homes have become a more critical source of wealth for retirees who have watched their mutual funds and 401(k) accounts hollow out. Next to accrued Social Security benefits, housing is the single greatest asset for people 60 to 70 years old, making up 22 percent of their total wealth and outweighing investments and pensions, according to the Center for Retirement Research. For retirees like Herman McHan, who watched the value of his mutual funds fall to $35,000, from $70,000, or Sylvia Merlin, whose portfolio has lost nearly $200,000 of value, owning an interminably on-the-market home compounds the worries of their dwindling investments.
For Ms. Merlin, it is a disconcerting place to be at age 93. She said she and her late husband, Al, had lived modestly to raise their four children, taking one vacation a year, to the Jersey Shore. She is on oxygen now, and finds it harder to get around her fifth-floor apartment outside of Philadelphia. The doorman’s wife takes her to the hairdresser on Fridays, but Ms. Merlin said she wanted more consistent care.
“I’m going to be 94, and I need help,” she said. “Making the bed is difficult. I need a little help taking a shower. Those things are difficult. I was a great cook, but I really don’t cook anymore. I bought the TV dinners, and they’re pretty lousy.”
No one has made an offer on her condominium, and Ms. Merlin said the retirement home had refunded the $1,000 deposit on the $130,000 unit she hoped to buy. Now, instead of moving, she said she had decided to stay.
“I just couldn’t go anywhere until I sold my apartment,” she said. “I and a lot of other oldsters are stuck.”
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