Independent Living
Housing Characteristics of Older Households: 1995
Research Report
Jeremy Citro, AARP Public Policy Institute
June 1998
Table of Contents: Introduction | Older Owners | Older Renters | Housing Quality | Housing Costs | Location and Length of Tenure | Conclusion | Footnotes
Introduction *
Housing that is well-designed, suitably located, and affordable contributes to the ability of older persons to maintain their independence. As such, housing is a crucial factor in determining the financial and emotional well-being of older persons.
The fifteen years covered in this analysis, 1980 to 1995, have witnessed sustained improvement in the housing conditions and characteristics of most older households. However, many older households have not shared in these improvements.
Older Owners
According to the 1995 American Housing Survey (AHS), 20.8 million housing units were headed by an older householder (i.e., age 65 or older). In that year, there were approximately 97.7 million households.The homeownership rates of older minority households were lower than the rate for all older households.
The incidence of mortgage debt among older owners is low.
Most older owner households occupied single-family homes, and most of these homes were worth a substantial amount.
Over one-third (36%) of older owners were single-persons.
Top of PageOlder Renters
Older renter households comprised 22% (approximately 4.5 million) of older households. The likelihood of renting increased with age and was higher for minority households.
Older renters lived in diverse types of structures:
Minority Renter Households
African American and Hispanic households represented 9% and 4%,
respectively, of all older households but 14% and 8% of older
renter households.
Single-Person Renter Households
Single-person households constituted about 71% of all older
renter households.
Housing Quality
The majority of older households, owners and renters alike, reported few problems with the physical quality of the housing they occupy1. In 1995, 6% of all older households reported moderate or severe physical problems with their housing.Location and Length of Tenure
More older households were located in suburbia than in other areas. Among older households:· 44% (9.2 million) were in suburban areas;
· 28% were in central cities; and
· 28% were in non-metropolitan areas.
Sixty-eight percent of older householders had resided in their current residences for more than 10 years. Half of older householders had lived in their present homes for 20 years or longer.
Older owners were more likely to have been in their homes for longer periods of time than older renters in 1995.
· Fifty-nine percent of older owners had lived in their current residences for 20 years or longer; only 24% had lived in their homes 10 years or fewer.
· Among the 4.5 million older renters in 1995, approximately 18% had resided in their current homes for 20 years or longer. Approximately 61% (2.8 million) of older renters had lived in their residences 10 years or fewer.
Housing Costs
2 All Older HouseholdsApproximately two-thirds (64%) of older households incurred monthly housing costs that were less than 30% of their current monthly income.
· However, about half of all older African American households and half of all older Hispanic households spent 30% or more of their monthly income on housing costs.
Older renter households tended to face higher housing costs and have lower incomes with which to have paid those costs than older owner households.
· Older owners had median monthly housing costs of $282, compared to median monthly housing costs of $412 for older renters.
· About half (49%) of older renter households had annual family incomes of less than $10,000, compared with only 20% of older owners.3;
As Figure 3 illustrates, older renter households tended to face higher housing cost burdens than older owner households.4
· Twenty-five percent of older owner households (more than 4 million) spent 30% or more of their monthly income on housing costs in 1995.
· However, fifty-eight percent of older renter households (approximately 2.6 million) spent 30% or more of their monthly income on housing costs in 1995.
· Twenty-seven percent (1.22 million households) of older renter households reported receiving some form of housing assistance.5
Conclusion
Analyses of American Housing Survey data show that there has been a consistent improvement in the homeownership rate of older households and in the physical quality of the housing occupied by both older owner and older renter households.
However, older renter households were more likely than older owner households to have spent an excessive amount of their income, in some cases close to half, on housing costs. Also, older renter households were more likely than older owner households to be older, have lower incomes, be single, and be members of ethnic minorities.
* All figures reported in this data digest,
unless otherwise noted, are extracted or calculated from
published 1995 data reported in the 1997 edition of the
American Housing Survey (AHS), U.S. Department of Housing and
Urban Development and U.S. Bureau of the Census. The 1997
edition is the most recent available. Comparisons to earlier
years are based on published AHS data for 1980 or 1985.
1 The U.S. Department of Housing and Urban
Development (HUD) defines two categories for classifying
housing units with physical quality deficiencies-moderate inadequacy and severe inadequacy.
Moderate inadequacy is defined as the presence of defects in
or problems occurring with at least one of the following
items: household plumbing, heating equipment, upkeep,
hallways, and the kitchen. Severe inadequacy is defined as the
presence of defects in or problems (different than those
included within moderate inadequacy) occurring with at least
one of the following items: plumbing, heating equipment,
electric, upkeep, and hallways. Adequate housing has none of
the defects or problems included under moderate or severe
inadequacy.
2 In the American Housing Survey (AHS), data for
housing costs are compiled as monthly estimates and presented
for both owner and renter households. Monthly housing costs
for owner households is the sum of monthly payments for all
mortgages or installment loans or contracts, real estate
taxes, property insurance, homeowners association fee,
cooperative or condominium fee, mobile home park fee, land
rent, utilities, fuels, and garbage and trash collection. For
renter households, monthly housing costs include the contract
rent plus the estimated average monthly cost of utilities and
fuels, property insurance, mobile home land rent, and garbage
and trash collection if these items are paid for by the renter
in addition to rent. Renter housing units occupied without
payment of cash rent are shown separately in the AHS as
"no cash rent."
3 Income data are from the 1995 AHS. Other
surveys, such as the Current Population Survey, may yield
different results regarding family incomes of older
households. For example, the household income data collected
by the AHS refer to the 12 months prior to the interview,
whereas income data collected by the Current Population Survey
refer to the prior calendar year. Differences in income data
may also result from the ways in which income questions are
asked and sampling and non-sampling errors in the AHS.
4 Percentages do not sum to 100%. Those
households reporting zero or negative incomes were not
included in this calculation. Some renter households reported
renting their homes without tendering cash rental payments,
and these renter households were excluded from this
calculation.
5 Assistance includes federal and state rental
subsidies, as well as units owned by public housing
authorities.
Written by Jeremy Citro, Consumer Team, AARP Public Policy
Institute
June 1998
©1998 AARP
May be copied only for noncommerical purposes and with
attribution; permission required for all other purposes.
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