### Addressing Senior Housing’s “Forgotten Middle”
As the American population continues to age, reports highlight a growing gap between senior housing supply and demand. However, the issue extends beyond simple availability. According to a recent *Urban Land Magazine* article, the challenge lies primarily in providing appropriate housing for middle-income seniors.
#### The Reality
Upper-end senior housing is thriving, and government subsidies help support housing for lower-income seniors. But for those in the middle-income bracket, options remain limited.
“If you need supportive housing or assisted living, it’s either private pay or Medicaid. But a massive number of people in the middle can’t afford private pay and don’t qualify for Medicaid,” said Lisa McCracken of the National Investment Center (NIC) for Seniors Housing & Care.
A report from the University of Chicago’s National Opinion Research Center (NORC) predicts that by 2033, 16 million middle-income seniors will struggle to afford the health, personal care, and housing services they need. Nearly 75% of these seniors won’t have the means to pay for assisted living, and even with home equity, almost 40% will still find it unaffordable.
#### The Causes
The main issue is a combination of stagnant middle-income wages and rising costs for food, medicine, and housing. According to Harvard University’s Joint Center for Housing Studies, only 14% of adults aged 75 and older who live alone can afford daily home health care after covering basic living expenses.
From a development standpoint, building senior housing for this demographic faces the same obstacles as general real estate projects—high construction costs and limited access to capital. Because senior housing is operations-driven, banks are often hesitant to lend to developers. Additionally, serving the middle-income market requires balancing budget constraints with providing essential services beyond just housing.
#### Possible Solutions
Experts suggest an integrated approach that combines housing, healthcare, and social infrastructure. Improving operational efficiency and streamlining services can also help reduce costs. Other potential solutions include design modifications, fewer high-end amenities, and forming strategic partnerships to expand accessibility.
Addressing the needs of the “forgotten middle” in senior housing will require innovative solutions and coordinated efforts from developers, policymakers, and community organizations.
About the Publisher:
Steve Griffin is based in sunny Palm Harbor, Florida. He’s an accountant by profession and the owner of GRIFFIN Tax (www.griffintax.com) and REVVED Up Accounting (www.revvedupaccounting.com). In addition, Steve founded Madison Avenue Technology (www.madisonave.tech). With a strong passion for commercial real estate, he’s also dedicated to keeping you up to date with the latest industry news.
