Economists have been talking for years about the huge demand for affordable seniors housing that will come as the baby boom generation passes through retirement and grows frail. Meeting that demand is becoming a problem, but housing advocates have several ideas that can make a difference—all of which, and more, will be sorely needed.

“It’s really an ‘all-of-the-above’ type of answer,” says Linda Couch, vice president of housing policy for LeadingAge, an association of nonprofit organizations dedicated to providing services for older adults.

Seniors Housing Already in Crisis
Millions of elderly people already suffer from the lack of an affordable place to live. In fact, more than 4 million people above the age of 65 live in poverty, according to the U.S. Department of Health and Human Services. Of those individuals, only 1.6 million receive rental subsidies from HUD.

“That’s a gap of 2.4 million,” says Corianne Payton Scally, senior research associate for the Urban Institute.

In New York City, for example, more than 200,000 elderly people have put their names on waiting lists to get into the city’s few Sec. 202 (the federal Supportive Housing for the Elderly Program) seniors housing properties. “Seniors are probably dying before they get into affordable housing,” says Couch.

A More Vulnerable Generation
One piece of the solution may be to simply increase the incomes of seniors through rental subsidies like housing vouchers. Nearly half of the people now being served by the federal Sec. 8 Housing Choice Voucher Program are seniors. Recent proposals in Congress, however, would cut the voucher program rather than expand it.

Today’s seniors are significantly more vulnerable than earlier generations. They’re less likely to own a home and raised fewer children than prior generations. “They’re outliving their savings and don’t have three or four children to take care of them,” says Andrea Ponsor, executive vice president for policy for Stewards of Affordable Housing for the Future. “There are a growing number of senior ‘orphans’ with no immediate family.”

Further, the number of elderly homeless people could double between now and 2030, says Couch. Seniors may also be forced to cut back on what they spend on food or health care to pay for housing. “They show up in emergency rooms with conditions that might have been prevented had these seniors had more stable housing,” says Ponsor.

Many seniors move into nursing homes and rely on federal programs like Medicaid to pay for the cost. “An enormous amount of older folks end up on Medicaid, particularly if they move into a nursing home. If you had a million dollars saved up, in just a few years it would be gone,” says Ponsor.

Medicaid seems—for now—to have survived proposals in Congress to deeply cut the program or shift Medicaid costs onto the states. However, though some seniors need nursing homes, many don’t need that level of intensive—and expensive—medical services.

Part of the solution, then, will be to help more seniors grow older in their own homes.

Staying Home
The health-care system is currently structured to funnel older adults who can’t live independently into nursing homes, whether or not they need the full level of care those institutions provide. “This is going to dramatically drive up health-care costs,” says Janet Viveiros, acting director of research for the National Housing Conference.

Most older adults would prefer to age in their own homes, according to data from AARP. Providing care and services to older adults in their own homes is also far less expensive than providing nursing-home care.

A new HUD demonstration program will begin this fall to help in that regard. The Integrated Wellness in Supportive Housing program will help seniors living in affordable apartment communities connect with health and wellness services. As part of the effort, nurses will visit the communities to provide basic health checkups and services.

“We’ll save the federal government a lot of money,” says Couch. The program is based on Services and Support at Home, a highly successful program that’s been active for several years in Vermont and pays for service coordination and nurse visits. Property managers also benefit from less turnover and fewer calls to ambulances at their properties.

The model can work well in places where seniors live close enough together so that services can be provided efficiently. “If you just create economies of scale, with enough seniors in one place, you’re golden,” says Couch.

“It’s going to be harder for these innovations to be applied in rural communities,” says the Urban Institute’s Scally. That’s simply because seniors are more likely to live farther apart from each other in these locales. Rural areas may also not have apartments where seniors can move if they need to downsize. “They might not have a place to transition to without leaving their existing social networks and care networks behind,” she says.

Elderly people may also be unable to age in place if their home can’t accommodate a walker or wheelchair. Less than 1% of the current housing stock would be accessible to someone in a wheelchair. “There’s a huge gulf between what the housing we need looks like and what [there] is,” says Couch.

Communities could also help by permitting more-flexible living arrangements. For example, allowing homeowners to rent out accessory dwelling units, once known as “granny flats,” could assist many. Smaller apartments or shared living arrangements are additional options.

Building and Preserving More Affordable Housing
Any solution to the shortage of affordable seniors housing will need to expand the supply of rental housing where seniors can live.

The federal low-income housing tax credit (LIHTC) is the most significant source of funding to build new affordable housing of all types, including seniors housing. However, the LIHTC program has been in existence since 1986 and still hasn’t produced enough housing to meet the need.

“We’re not really building in the way we need to for seniors,” says Ponsor. “For the LIHTC program, there are insufficient resources.”

A bill now before the Senate would significantly increase the LIHTC program. The proposal would also raise the amount of tax credits generated by LIHTC developments that serve very-low income residents. That would be a big help to developers that house elderly people, who tend to have low incomes because they’re unlikely to be working.

Preserving existing affordable housing is another important part of the puzzle. “We need to preserve every unit of affordable housing we have,” says Couch. An expanded LIHTC program would help, though as budget battles continue in Congress, even a strengthened LIHTC program could be partly offset by cuts to other important federal programs such as HOME or Community Development Block Grants.

New programs are helping preserve and recapitalize public housing and older affordable housing properties, however. Nearly a third of public housing serves seniors, according to Couch. A proposal now before Congress would expand the federal Rental Assistance Demonstration (RAD) program, which is helping to recapitalize public housing properties.

“RAD has really changed the landscape for the future of public housing,” says Couch. Also, RAD doesn’t add to the federal budget.

An expanded RAD program could also include aging Sec. 202 properties, making those developments easier to recapitalize. These properties are especially valuable, since nearly half of Sec. 202 assets already provide some level of service coordination for their elderly residents, helping seniors to be able to age in place. Advocates also hope Sec. 202 may one day receive more funding; the program hasn’t funded any new construction in several years.

“I am a proponent of more of everything,” says Couch.