More Older People will be renters – A trend we cannot ignore

Judith Davey

21/02/2018

In December 2015 I critiqued a report entitled Homeless Baby Boomers. Since then housing problems have come to the fore and hardly a day goes by without a headline relating to the “housing crisis”. Often it is first home buyers who are seen to be suffering most. But here I want to look back to other research, which focused on older renters.

The rate of home ownership in New Zealand has been dropping since its peak in 1986, when 73.5% of households were owners, to 67% at the time of the 2006 census and 65% in 2013. And the rate is projected to fall even further in the future, even though homeownership is still somewhat higher among older people.

New Zealand housing policy from earliest times has emphasised the goal of home ownership, imparting it with moral value (ownership was claimed to produce responsible and stable citizenship). As a result, renting has been seen as second class; renters have been stigmatised and renting tenure is insecure.

Older people are especially vulnerable if their housing tenure is insecure and if their housing is cold and damp. Renters cannot easily adapt or modify their housing to deal with declining health and reduced mobility. Many surveys have shown that renting in New Zealand is associated with social and economic deprivation. It is the poorer people in any age group who are more likely to be renters. The implicit assumption has always been that NZ Superannuation will be sufficient to support a basic lifestyle provided that the recipients are home owners and have paid off their mortgages by the time they reach the age of eligibility. So falling home ownership and increased renting among older people should be a cause for concern.

Our report to the Department of Building and Housing in 2008 included the following findings.

• In 2006, there were 288,900 households where the reference person was 65 years old or older. Of these households, one in five was living in rented accommodation.

• 34,920 rented from private landlords (64%); 11,180 households from central government (20%); and 8,120 households from local authorities (15%).

• From 1996 to 2006 the number of older households renting from private landlords increased by nearly 30%. So this is the dominant tenure type for older renters.

• One person households were the predominant type of household among older renters, accounting for nearly two-thirds of such households. The majority of one person households were composed of women.

These figures have probably not changed greatly in the 2013 census and we await the 2018 figures.

Projections

But the projections to 2051, however tenuous, are concerning.

• By 2051 the number of households with a reference person 65 years or older is projected to increase to 820,000, of which 169,000 will be living in rented accommodation (21%).

• Between 2006 and 2051, the number of older renter households in the 65 to 74 age group is projected to more than double. In the 75 to 84 age group it will nearly triple. In the 85 and over age group numbers will grow nearly nine-fold, from 6,670 to 53,885.

• Numbers renting from private landlords will grow from 34,970 in 2006 to 112,260. Those renting from central government will increase by about the same amount, from 10,865 to 40,450. Renting from local authorities is projected to nearly double, to 16,130 households in in 2051.

These figures call for policies to increase the supply of affordable rental housing designed with older households in mind, particularly single (and female) tenants. Can the private sector be relied upon to do this? Concerns are frequently expressed about the quality of housing in this sector, with calls for independent “warrants of fitness.”.

In the past, local authorities received subsidies and low interest housing loans from central government, but both central and local government public rental stocks have been cut and there is considerable concern about the sale of pensioner rental housing and rent increases.

It seems there is a role for innovative private and public rental developments, with central and local government, private sector and ‘third sector’ (i.e. voluntary organisation) landlords working together.

Given growing numbers of very frail and disabled older people, rental housing providers of whatever sort need to recognise the need for home-based services and investment in appropriately designed housing , and also that housing needs interact closely with care needs. This means better integration of social support, health care and housing, and changing expectations, values and standards concerning the quality and appropriateness of housing. Innovative approaches to planning and design and increased engagement of users in the development of housing models and advocacy services are required for all sectors of the housing market. It is vital that the needs of renters are not obscured by the needs of majority home owners.

 

[1] Nana, Ganesh, Stokes, Fiona, Keeling, Sally, Davey, Judith and Glasgow, Kathy (2008) Older Renters 1996-2051: Trends, Projections, Issues and Challenges. NZiRA and BERL.

[1] The reference person is the Statistics New Zealand term for the person who completes the Census dwelling form.