Renting and “aging in place,” but not alone, is a growing preference for aging baby boomers and seniors and offers a unique opportunity for investors who want to invest in and operate multifamily units.
Baby boomers are defined as those born between 1946 and 1964 while seniors are defined as those born before 1946.
According to research done by ARBOR, an increasing number of senior renters now live with unrelated adults across all multifamily property types. Small apartment buildings (5-49 units) have slightly higher shares of senior renters with roommates compared to large multifamily properties (50+ units). However, the co-living senior renter segment is growing the fastest in large-asset multifamily.
Co-living among seniors is highest in the single-family rental (6.1%), then the duplex/quadruplex (5%), next small-asset multifamily rentals (4.6%), and last, large-asset multifamily rentals (3.2%). To put this in perspective, among Millennial renters, the share of renters living with a roommate in a small-asset multifamily situation is 14.4%.
Sharing is motivated primarily as much by social connection as by income needs. According to Psychology Today, “20% of people over 60 frequently feel intensely lonely.” Loneliness can be a risk for heart disease, Type 2 diabetes, arthritis, and Alzheimer’s disease. Because of health risks associated with loneliness, seniors that share a home are actually dealing with their current and potential future loneliness.
In addition to social connection and apartment affordability, sharing is also motivated by personal security, and sharing of daily chores. The need to “age in place” is driving the increase in co-sharing seniors in the large asset multifamily rental because these buildings tend to be located near urban services and health care centers, have elevators and wheelchair lifts, and have higher levels of amenities.
Amenities Promoted in 55+ Adult Living
When looking over senior housing options available in Houston, I found most of the advertising in the higher end communities mentioned affordability, distinction, style, lifestyle, freedom from chores, and choice. Specific advantages and amenities listed by the higher end properties in the facility advertising included:
- Beautifully landscaped grounds
- Luxurious and spacious interiors
- Locations close to dining, entertainment, parks
- Locations close to and medical centers
- Diverse and colorful neighborhood
- “Dynamic alternative to the ordinary”
- “Live your lifestyle with passion”
- Distinctive living experience
- Restaurant-style dining
- Resort amenities
- Complete freedom
- Infinity pool
- Court yards
- Dog park
- Wine tasting lounge
- Media room
- Chef quality demonstration living
- It’s a lifestyle
- Boutique, resort style
Amenities Advertised at Less Expensive 55+ Community Options
Retirement and 55+ community combinations in a lower price category advertised:
- Activities and programs
- Aging in place
- Outdoor grills
- Designer living
- “Trade your to do list for a bucket list”
- Outdoor pool
- Yoga and art classes
- Access to meals
- People of similar life stages
- Leave home maintenance and yard work behind
- Water gardens
- Swimming pool
- Computer room
The youngest of the baby boomers are approaching 55, and the huge number of 55+ adults who are still active but looking for reduced housing maintenance responsibilities and costs as they age and live within a fixed income makes this group a dynamic market for senior living situations. Not all are turning to apartment renting, but this tend is worth watching.
Competition for good rental properties is stiff, and in order to buy a property in a climate of competition you may need funds fast. As a broker and a direct lender, it is my job to help you get a hard money loan easily and quickly. Private Lenders, not banks, are willing to help you fund your project based on the value of the property and its after renovation value. We have money to lend. A perfect fit is out there.
Give me a call or send an e-mail. I am focused on funding your success.
Patrick StCin, 512-213-2271,