Elderly and housing costs Constraints in mobility on the housing market M. Leussink J. Smeets

Content Introduction Housing costs To move or not to move Push, pull & keep factors Discussion

Introduction (1) One of the goals of the Dutch policy is to stimulate elderly people to live independently as long as possible (up to 75-80 years old). Especially Housing Associations have the task to accommodate these elderly households in combination with services (‘live and care’-concepts). Not only the households in the rental sector belong to their target groups, but also elderly households in the owner occupied sector. The question is: Are they willing to move? What are the reasons to move or not to move?

Introduction (2) Forecasted development of senior citizens in region Eindhoven (Province Noord-Brabant) shows that the target group growth rapidly.

Introduction (3) This presentation is mainly based on three surveys: A survey among tenants and owners about their housing costs in the region of Eindhoven providing insight in the affordability of housing. [Leussink & Smeets, 2012] A research of Van Ginkel among elderly households to get insight in the significance of push, keep and pull factors in the decision to move or stay. [Van Ginkel, 2012] A tri-annual housing survey among inhabitants of South East Brabant. [SRE, 2011]

Housing costs (1) The housing costs of households are not only determined by rent or mortgage but also by dwelling-related costs. pag2

Housing costs (2) Dwelling related costs as energy have increased continuously and will increase in the future.

Housing costs (3) Population: Social rental sector: Households in affordable dwellings (rent < €652,52/month) Owner-occupied sector: Households in affordable dwellings (purchase price < €250.000) Respondents: Social rental sector: N=910 Owner-occupied sector: N=580

Housing costs (4) Elderly households in: - Social rental sector: 55%   social rental sector owner occupied sector Households N % single <30 years 35 4% 6% couple <30 years 32 42 7% single 30-54 years 130 14% 83 couple 30-54 years 53 9% family 103 11% 162 28% single-parent family 74 8% 27 5% single 55-74 years 186 20% 58 10% couple 55-74 years 156 17% 100 single >74 years 91 7 1% couple >74 years 68 13 2% total 910 100% 580 Elderly households in: - Social rental sector: 55% - Owner occupied sector: 31%

Housing costs (5) Specified housing costs by type of households in social rental sector

Housing costs (6) Specified housing costs by type of households in owner occupied sector

Housing costs (7) Housing costs quota* by type of households in social rental sector * Ratio of current housing costs/disposable income

Housing costs (8) Housing costs quota* by type of households in owner occupied sector * Ratio of current housing costs/disposable income

Housing costs (9) Housing costs of young elderly (55-74) and elderly (>74) households in.. ..social rental sector: ..owner occupied sector:

Housing costs (10) Total housing costs in social rental and owner occupied sector during course of life:

To move or not to move (1) Housing costs of elderly people in the rental sector are substantial higher then in the owner occupied sector. A shift from the owner occupied sector toward the rental sector has -among others- cost implications for the household. Are elderly people willing to move and what are the push, keep and pull factors?

To move or not to move (2) In general: only 14% of the elderly households is willing to move within two years (PBL, 2013). Keep factors are [Planbureau voor de leefomgeving, 2013; “Vergrijzing en woningmarkt”]: moving does not lead to an improvement of the housing situation [Schellekens 2010, Van Iersel et al., 2009] resistance against moving increases with age [Huff & Clark, 1978] attachment to dwelling and direct environment increases with age [Filius 1993; Van der Meer 2006; Smith 2009] higher total housing costs in the rental sector can owners do decide not to move to that sector [Leussink & Smeets, 2012]

To move or not to move (3) Motives to move starters door-stromers <30 30-44 45-54 55-64 65-74 >75 total work/study 10% 4% 5% 2% 1% 0% 6% want to live independently 68% 46% 20% changed personal circumstances (living together, marriage, birth, divorce etc) 16% 22% 26% 25% 11% (expected) fysical limitations/need for care due to age or sickness 18% 12% 35% 65% 13% want to go back to place of birth quality of current dwelling doesn't meet needs anymore 14% 9% 3% quality of current living environment doesn't meet needs anymore 8% other reason 27% 34% 32% [SRE: Woonbehoeftenonderzoek Zuidoost-Brabant 2011] The main push motive for elderly to move is fysical limitations/need for care.

To move or not to move (4) In general those who are willing to move are looking less for an owner-occupied property (59% in 2007; 49% in 2011). Especially for elderly households a rental dwelling can be a pull factor. Owner occupied property Land to build Rental home

To move or not to move (5) Economic crisis and governmental plans: Constraints to move (SRE, 2011): Economic crisis and governmental plans: No/not enough mortgage Expected problems selling current dwelling Uncertainty about mortgage interest relief (tax benefit) Uncertainty about working situation Finding a social rental dwelling is harder because of income limitations  

Push, pull & keep factors (1) Rental sector Push Pull Keep Dwelling Overall size Total housing cost Number of bedrooms Outdoor space Type of the dwelling Total housing costs Size dwelling Dwelling entry Attachment to the dwelling Neigbour-hood Behaviour neigbours Attachment and contact with neighbours Accessibility of the dwelling Quality of the residential area Parking facilities Green space Facilities Accessibility of public transport Accessibility of facilities Accessible retail facilities Accessible medical facilities Availability of transport Accessibility of retail facilities Accessibility of medical facilities Services Service to move house Maintenance service Dwelling adjustment Source: Van Ginkel 2012

Push, pull & keep factors (2) Owner occupied sector Push Pull (rental) Keep Dwelling Overall size Number of bedrooms Outdoor space Type of the dwelling Size dwelling Total housing cost Dwelling entry Attachment to the dwelling Neigbour-hood Behaviour neigbours Attachment and contact with neighbours Accessibilty of the dwelling Quality of the residential area Accessibility of the dwelling Parking facilities Green space Facilities Accessibility of public transport Accessibility of facilities Accessible retail facilities Accessible medical facilities Availability of transport Accessibility of retail facilities Accessibility of medical facilities Services Service to move house Maintenance service Dwelling adjustment

Discussion (1) The tendency to move among elderly people is small. A housing policy that is based on the assumption that elderly will move to ‘live and care’ dwellings in the rental sector and will create space for younger movers on the market will fail. The keep factors for elderly households are strong. Elderly people will live independently as long as possible anyway.

Discussion (2) The low housing costs of owner occupiers is a strong keep factor. Those who are willing to move expect problems selling current dwelling.

Discussion (3) However the next generation of elderly will have higher housing cost. (interest-only mortgages, second mortgage). Costs as a keep factor will be less significant. The other keep factors (dwelling type, attachment, facilities) however will also be of importance for them.

Thank you for your attention! Email: j.j.a.m.smeets@tue.nl