One in Three Older Households Is Cost Burdened

JCHS

The recently released State of the Nation’s Housing 2025 report highlights worrying trends in housing affordability for older households (those led by someone age 65 or over). In 2023, over a third (34 percent) of older households were cost burdened, paying more than 30 percent of their income for housing. This represents a new high of over 12.4 million households and an increase of nearly 2.3 million households just since 2019. More than half of these households, 6.7 million, pay over 50 percent of their income for housing, making them severely cost burdened (Figure 1).

Figure 1: Over 12 Million Older Households Face Cost Burdens

Notes: Moderately (severely) cost-burdened households spend 30-50% (more than 50%) of their income on housing costs. Households with zero or negative income are assumed to have burdens, while households paying no cash rent are assumed to be unburdened.

Source: JCHS tabulations of US Census Bureau, American Community Surveys.

Both Renters and Owners Increasingly Struggle with Housing Costs

Fully 58 percent of older renters were burdened in 2023, representing 4.5 million households and an increase of over 570,000 households between 2019 and 2023. The majority of this group were severely burdened. Older renters are more likely to live on fixed incomes that may not keep up with rising rents, and those with lower incomes may have little left over in the household budget to pay for out-of-pocket medical costs, food, and other necessities. Cuts to Medicaid and nutrition assistance in the recent reconciliation bill will mean even less support for the most vulnerable of these households.

Older homeowners, a far larger group owing to the high homeownership rate among older adults, are not immune from growing affordability challenges. Between 2019 and 2023, the cost-burden rate for older homeowners rose from 24 percent to nearly 28 percent. This lifted the number of cost-burdened older homeowners to 7.9 million, an increase of over 1.7 million since 2019. The number of households with cost burdens rose to 4.1 million, up 1.1 million households from four years prior.

Older owners with mortgages are more likely to face affordability challenges than those who own free and clear. Fully 43 percent of older owners with mortgages are cost burdened, compared to 19 percent of those who own without a mortgage (Figure 2). The number and share of older adults with mortgages have grown over the past decades: in 2022, fully 31 percent of owners in their 80s and over held a mortgage on their homes. Yet steep increases in property insurance are contributing to affordability challenges for even those with no mortgage, particularly in areas with the greatest risk of climate-related disasters.

Figure 2: High Shares of Owners with Mortgages Are Cost Burdened

Notes: Moderately (severely) cost-burdened households spend 30-50% (more than 50%) of their income on housing costs. Households with zero or negative income are assumed to have burdens, while households paying no cash rent are assumed to be unburdened.

Source: JCHS tabulations of US Census Bureau, 2023 American Community Survey.

Affordability challenges are more prevalent among households headed by people of color, with cost burdens rates nearing 46 percent for Black older adults and 43 percent for Hispanic older adults (Figure 3). Householders who are Black, Hispanic, Asian, or of other/multiple races are also more likely than white households to have severe cost burdens.

Figure 3: Cost Burdens Are More Prevalent Among Households of Color 

Notes: Moderately (severely) cost-burdened households spend 30-50% (more than 50%) of their income on housing costs. Households with zero or negative income are assumed to have burdens, while households paying no cash rent are assumed to be unburdened. Householders who are White, Black, Asian, or of another race are non-Hispanic; Hispanic householders may be of any race.

Source: JCHS tabulations of US Census Bureau, 2023 American Community Survey.

Cost burdens are also more prevalent among those in their 80s and over, a group that the Center projects will double over the next two decades. Nearly 40 percent of households in this age group are burdened compared to just over 32 percent of those aged 65–79. These higher rates of cost burdens reflect a decline in median income among people in their 80s and over, in part driven by an increase in single-person households. As the baby boomers turn 80 in large numbers, we expect more people will struggle to meet housing costs as the need for in-home services and accessibility modifications also grows.

Growing Challenges Require Greater Levels of Assistance

Older households increasingly need support affording their housing, as well as the services they may need to remain in their homes. Yet need already outstrips available assistance. Federal rental assistance is underfunded for very low-income older adults: at last measure in 2021, of the older adults earning no more than 50 percent of the area median income and thus qualifying for federal rental assistance, only 36.5 percent received it. The majority of the unassisted households were severely cost burdened, lived in severely substandard conditions, or both. In addition to existing shortfalls in aid, proposed cuts to federal funding for rental assistance could be devastating as rents continue to rise and the older population living on fixed incomes continues to grow. Cuts to Medicaid and nutrition assistance in the recent reconciliation bill will also mean diminished support for the most vulnerable households, further stretching household budgets. Already, people age 50 and over represent the fastest growing population of unhoused people in the US; helping people stay stably housed is far more cost-effective—and far more supportive of individuals’ independence and dignity.

Older homeowners with low incomes and limited wealth may also make difficult tradeoffs as a result of housing costs. For older owners, help addressing housing affordability typically comes from property tax relief implemented by state and local governments, assistance with home repairs and modifications offered through governmental and nonprofit sources, and energy efficiency programs that can reduce utility costs. But given the rise in the numbers of older, cost-burdened homeowners with limited resources, there is also a need for assistance for those struggling to manage monthly mortgage and insurance payments. A subset of owners would benefit from more tools with which to draw safely on their home’s equity, but many people who live in lower-cost areas have lacked the resources to invest in their homes, or have debt or credit problems, which could make extracting equity while remaining in the home difficult. Selling one’s home and relocating to less expensive housing in one’s community is theoretically possible, but in reality is limited by a dearth of affordable and otherwise suitable alternatives in many locations.

Preserving and expanding the supply of affordable, accessible housing is also important to ensure that both older owners and renters—as well as households of all ages with limited resources—have suitable housing options should current homes become too expensive, isolating, or difficult to navigate or manage. Increasing allocations to the Low-Income Housing Tax Credit program can help, but there is also a need for communities to allow the construction of smaller homes and apartments near services and amenities. For renters and owners alike, there is also a role for emergency assistance for short-term challenges paying housing costs, particularly now that pandemic-response efforts have mostly ended.

Housing affordability challenges among older adults are rapidly becoming more pressing and more prevalent, creating even greater need for programs that can help people with lower and fixed incomes remain stably housed in surroundings that support health and well-being. Reducing existing safety net programs will only be more costly in the long run, and the cost of not addressing the affordability crisis is far too great for individuals, families, and society itself.