Housing Affordability

Housing costs determine whether individuals and families can live in a neighborhood without sacrificing other basic necessities, such as food and health care. Yet approximately 11 million households headed by someone age 50 or older are considered severely cost-burdened. They spend more than 50 percent of their income on housing. Housing-cost burden affects both homeowners and renters, but renters are more likely to experience it.

Renters typically have lower incomes than homeowners. They also usually face rising rents each year. Homeowners with fixed-rate mortgages have more predictable housing costs (see also Home Mortgage Lending). Homeowners typically are less housing cost burdened than renters across age groups. The difference is greatest for families with adults age 80 and older. Sixty percent of these renter households are cost-burdened, compared with 30 percent of homeowners in the same age group.

Older renters tend to be more rent-burdened than younger renters. In 2021, 56 percent of renter households headed by someone age 65 or older spent at least 30 percent of their income on rent. This leaves very little money for other necessities, such as food and health care. People with high housing-cost burdens may be at risk of eviction and displacement if appropriate tenant protection laws are not in place. The severe shortage of affordable housing can put families and individuals at risk for homelessness.

Policymakers can address affordability by increasing subsidies for housing. They can also create more housing and expand the variety of housing options to promote affordability.

Missing middle housing: This term refers to a range of multi-unit or clustered housing types that are compatible in scale with detached single-family homes, such as townhouses and other attached houses and accessory dwelling units (units built on the same property as a single-family home). They exist in the middle of the continuum between detached single-family homes and large apartment buildings. This type of housing is considered “missing” because very few have been built in the U.S. since the early 1940s because of zoning constraints and development patterns (see also Land Use and Zoning). Missing middle housing provides size and affordability housing options that people of all ages—including older adults—need but often cannot find. The housing type can enable family members to live with or near one another while having their own space or residence.