HUD Secretary, AARP CEO addresses aging in place and housing issues for the elderly
U.S. Department of Housing and Urban Development (HUD) Secretary Marcia Fudge recently spoke with AARP CEO Jo Ann Jenkins about the state of senior housing and aging on place, marking the first major public comment regarding the elderly made by the Secretary since taking the oath earlier this year.
Among the topics discussed, Fudge and Jenkins discussed the preferences of many older people to age in place; why community living environments have become less important in the landscape of retirement homes in recent years; as well as legal realities at the local, state and federal levels which sometimes act as barriers to the expansion of senior housing.
The need to strengthen the option of aging at home
One of the first major topics covered in the discussion presented relates specifically to ways to facilitate aging in place in American seniors. Because of the often immense costs that dedicated collective care facilities can entail, finding a way to renovate a home to better meet the physical needs of a senior in an existing property is something Secretary Fudge is very interested in.
“I discovered during my very short stay at HUD that local ordinances and zoning often create barriers to the type of housing seniors need,” says Fudge. “We find ourselves in situations where we cannot always build housing for the elderly, but people can allow themselves to stay at home, sometimes they just need a little help.
Fudge goes on to ask Jenkins specifically how a senior can be assisted if they want to stay in their home for long periods of time, and whether or not there is a way for them to do so while at the same time.[ting] additional income by doing so. Instead of naming something like a Home Equity Conversion Mortgage (HECM) as one of those possible options for this kind of scenario, she instead talked about some of the work that AARP is doing to expand the availability of units. Accessory Accommodation (ADU) on existing properties. .
“[These] allow people to maybe convert a garage, or build a unit at the back of their house or convert a room where someone who might need extra help – be it a parent or a loved one – can get it, ”she said. “We know that the average cost of caring for an adult in a nursing home is almost $ 80,000 per year in the United States. So the ability to adapt the structure of the existing house, or the structure of a child’s house to bring that loved one to live with them, makes a world of difference.
Additionally, aging in place, especially through something like an ADU, can also help address isolation issues that older people may face, and AARP has worked with state and community governments to resolve zoning restrictions that can often hamper the construction of ADUs.
Fudge added to the points made by Jenkins by specifically addressing the fact that homelessness is a growing concern for American seniors, which can be linked to the price and general availability of housing. Fudge also expressed hope that members of AARP’s vast membership network would be aware of the forms of relief available through recent legislation like the American Rescue Plan Act, which can help provide rental assistance or a mortgage forbearance.
The sprawling responsibilities of the HUD
Fudge also mentioned a general comment she made that the issues of older people may not get the necessary attention they need from housing authorities due to so many other pressing issues. that can affect the housing stability of the entire American population.
“Elders [are] something that people, as a rule, don’t watch, ”says Fudge. “They don’t look at age discrimination very often, and it is as widespread as any other form of discrimination. And so, we’re going to enforce fair housing laws, and we’re going to make sure we look at the disparate impacts. We want to make sure that we are doing whatever is necessary and possible to make sure that every American is treated with the fairness they deserve.
Fudge also touched on the realities facing the US housing system in regards to climate change, saying that over the past 10 to 15 years, HUD has spent around $ 90 billion on emergency relief alone. disaster. In disasters, low-income people are disproportionately affected, as are the elderly, she explains.
“Most of it [$90 billion] the aid was aimed at low-income people, many of these places are seniors, ”she says. “So we just have to be able to make the commitment. It’s not that we don’t have the will. We have the will, we just have to have the capacity and we just have to commit to doing it. Because the elderly really suffer a lot from disasters, be it floods or fires.
Reverse mortgages are MIA
While it’s hardly surprising that the conversation between Secretary Fudge and Ms. Jenkins did not include reverse mortgages, the applicability of the first topic of the conversation may certainly be reminiscent of the HECM program, especially since ‘It is sponsored by the Federal Housing Administration. (FHA). However, the AARP in the past has gone to court over borrower safety issues arising from reverse mortgages, particularly for issues involving non-borrowing spouses (NBS).
The last few years have shown in AARP’s own research that a clear majority of seniors want to age in place, and the overall outlook for the organization has softened in recent years, especially when major changes have been passed on. to the HECM program by the FHA and HUD. However, while reverse mortgages can be useful in certain situations, the organization in general does not subscribe to the idea that HECMs or other variations provide long-term solutions to retirement problems in the United States.
“At AARP, we don’t see home equity or reverse mortgages as a major solution for everyone to the retirement security problem,” said Debra Whitman, executive vice president and chief executive officer. public policies at AARP in a speech at a Brookings Institution event in 2019. “In our view, even transparent and well-designed reverse mortgages can play only a limited role in improving the financial outlook of Most people. “
Citing the median home equity value in 2016 of $ 145,000, Whitman argued at the time that most people will not be able to provide the security of their retirement for the duration of their retirement. their increasingly lengthy retirement by using home equity products like reverse mortgages, while also declaring reverse mortgage foreclosures “too high”. However, she also said that reverse mortgages can work for some people in specific situations.
A columnist who previously wrote for the association, Jane Bryant Quinn, also described last year how she had a “change of mind” regarding reverse mortgages, citing the maturation of the product category and the various changes she underwent during the course of her availability in the United States.
“The law has changed. Now if you apply for a reverse mortgage and the lender’s analysis is that you might be unable to pay your bills after ten or fifteen years, you don’t have all the money to spend, ”Quinn said in 2020 “The lender is saving a little bit to pay the property taxes and keep the house running. So there is less risk for people who do not have a lot of money.