The implications of immigration and the browning of America command the attention of polit-ical candidates and policymakers, but the biggest change in the nation’s hues has nothing to do with white, black or brown: It’s an ocean of gray.
By 2030, as the first Baby Boomers approach their 85th birthdays, the numbers of Americans that age and older are projected to rise by half, according to Census bureau estimates. And by 2050, those levels will have tripled from 2010, reaching 19 million. And that’s just for the oldest of the old.
Among the Boomers, the population of Americans 65 and older will grow even more dramatically, reaching roughly 75 million by 2035 and 88 million by 2050. Which raises the question: Where are they all going to live?
Thanks to advances in construction techniques and aging-in-place processes, a fair number will continue to live at home until their last days. Tens of millions more, though, will spend their final years in some form of senior living—at an independent-living center, in an assisted-living setting or in a nursing home.
Do the math: As of 2010, roughly 1 million Americans were living in senior-care facilities, and current estimates are that the nation’s supply of living units for the elderly is running at 90 percent capacity. If even a fraction of the “newly old” must move out of their homes for health or financial reasons, the nation is looking at a significant housing crunch. But experts say it won’t be explosive growth; rather, it will phase in gradually over the next generation because the projected peak housing demand for seniors is 15 to 20 years away.
According to Boston-based Lux Research, the construction market for senior housing worldwide will more than double within the next decade, to $127 billion in the G20 nations. But rather than an explosion, that works out to a manageable increase of 8 percent a year.
But it will come unevenly, with retirement-friendly regions of the country experiencing considerably higher growth rates in that population. And it will change the very nature of the nation’s housing stock, with smaller homes that require less effort to get around, with more affordable homes, to manage the financial challenges for at the two-thirds of the Baby Boomers with little to no retirement savings to date, and with amenities aimed at improving the quality of life for those with age-related disabilities.
One other age-related impact related to senior living: Investing. According to the National Association of Real Estate Investment Trusts, the growth in investment trusts related to construction in health care venues has outpaced most other real-estate investing in recent years, and that demand for new housing is expected to keep that investment sector humming for another generation.