Citation
Toward a housing policy proposal for the elderly

Material Information

Title:
Toward a housing policy proposal for the elderly
Creator:
Miller, George F
Publication Date:
Language:
English
Physical Description:
ix, 147 leaves : ; 28 cm

Subjects

Subjects / Keywords:
Older people -- Housing -- United States ( lcsh )
Older people -- Housing ( fast )
United States ( fast )
Genre:
bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

Notes

Bibliography:
Includes bibliographical references (leaves 140-147).
General Note:
Submitted in partial fulfillment of the requirements for the degree, Master of Planning and Community Development, College of Architecture and Planning.
Statement of Responsibility:
by George F. Miller.

Record Information

Source Institution:
University of Colorado Denver
Holding Location:
Auraria Library
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
15515806 ( OCLC )
ocm15515806
Classification:
LD1190.A78 1986 .M563 ( lcc )

Full Text
yn/z-L-Bz
TOWARD A HOUSING POLICY PROPOSAL FOR THE ELDERLY
ssssssr
GEORGE F. MILLER September, 1986
ARCHIVES
LD
1190
A78
1986
M563


^toward a housing policy
PROPOSAL FOR THE ELDERLY
"j-.LL.ten and Presented
* Jl
J.
* uuii iment
of the Requirements for the Masters Degree in Planning and Community Development
at the
University of Colorado at Denver by
GEORGE F. MILLER September, 1986


ACKNOW LEDGEKENTS
The author of this research project has enjoyed the support of many individuals and sources and wishes to thank all those who have assisted in the process to complete this study.
A special thank you goes to my wife, Christy, for all her support, patience and love throughout this past year.
i


TABLE OF CONTENTS
Page
ACKNOWLEDGEMENTS ........................................... i
LIST OF TABLES............................................. ii
LIST OF CHARTS............................................. iv
ABSTRACT ................................................... v
Chapter
I. INTRODUCTION ....................................... 1
II. AGING AND HOUSING POLICY: AN OVERVIEW ............ 6
1) Gerontology .................................. 6
a. Studies of the Aging Process............. 6
b. Theories of Aging........................ 8
2) Housing Policy............................... 13
a. Housing Policies in the 1930s
and 1940s............................... 14
b. Housing Policies in the 1950s
and 1960s............................... 15
c. Housing Policies in the 1970s
and 1980s............................... 20
d. Elderly Participation in Programs . 22
III. CHARACTERISTICS OF THE ELDERLY..................... 29
1) Size and Growth of the Older Population . 29
a. Number and Age Distribution............. 32
b. Oldest Old.............................. 38
c. Race and Ethnicity...................... 40
d. Sex Ratios.............................. 40
e. Marital Status and Living Arrangements 42
f. Support Ratio........................... 45
g. Life Expectancy......................... 48
2) Geographic Distribution and Mobility ... 50
a. States.................................. 50
b. Suburbs................................. 51
c. Mobility................................ 52
d. Countermigration ....................... 53
3) Economic Status.............................. 54
a. Median Cash Income...................... 55
b. Poverty Status.......................... 55
c. Age and Income.......................... 57
d. Composition of Income................... 59
e. Income Trends........................... 61
f. Consumer Expenditures .................. 64


g. Non-Cash Resources ..................... 66
h. Retirement....................... 71
i. Federal Outlays and the Elderly ... 72
4) Concusion..................................... 73
IV. THE ELDERLY AND THEIR HOUSING.................... 75
1) The Current Housing Situation ................ 76
2) Housing Tenure and Living Arrangements . 81
3) Housing Costs................................. 84
4) General Housing Characteristics .............. 85
5) Dwelling Quality ............................. 88
6) Conclusion.................................... 92
V. ELDERLY HOUSING IN THE DENVER REGION ................ 96
1) Denver Elderly Population Characteristics . 97
a. Age and Sex...................... 97
b. Location of the Elderly.......... 97
c. Elderly Population Projections .... 101
2) Housing Characteristics ..................... 103
a. Housing Tenure...................103
b. Household Types..................106
c. Supply of Housing Designed for the
Elderly.................................106
3) Economic Aspects ............................ 110
4) Housing Needs Assessment ........... 115
5) Conclusion....................................116
VI. CONCLUSIONS AND RECOMMENDATIONS ................. 120
1) Introduction..................................120
2) Literature Overview ......................... 120
3) Research Findings ........................... 124
4) Recommendations...............................127
BIBLIOGRAPHY
140


LIST OF TABLES
Table Page
2-1 Occupancy in HUD-Subsidized Rental Programs 26
3-1 Distribution of the Population by Older Age Groups 31
3-2 Actual and Projected Growth of the Elderly 35
3-3 Living Arrangements of Older Males and Females. 44
3-4 Marital Status of Older Males and Females ... 44
3-5 Young, Elderly and Total Support Ratios 1940-2050 47
3-6 Life Expectancy at Birth and Age 65 by Sex and Year 49
3-7 Percent of Elderly and Non-Elderly Persons by Ratio of Income to Poverty 56
3-8 Poverty Rates for Non-Elderly and Elderly ... 58
3-9 Source of Income as a Percentage of Income 60
3-10 Average Annual Expenditures of Consumer Units 65
3-11 Percent of Persons by Relationship of Income to Poverty Level Using Alternative Definitions of Income 70
4-1 Living Arrangements of Persons by Age and Sex 77
4-2 Type of Group Quarters by Age 80
4-3 Distribution of Elderly Households by Tenure And of Household Type by Age 83
4-5 Percentile Distribution of General Characteristics of Units Occupied by Elderly and Non-Elderly, By Tenure 87
4-6 Rates of Selected Housing Deficiencies for Various Types of Households Headed by the Elderly 90
5-1 Distribution of Elderly by Age and County, 1980 100
11


5-2 Sex Ratios, 1980 100
5-3 Distribution of Elderly Population by County,
1980 100
5-4 Population Projections, Denver SMSA ............. 102
5-5 Distribution of Households by Tenure, 1980 . . 105
5-6 Estimated Inventory of Housing Units Designed
Specifically for the Elderly.................109
5-7 Number of Elderly Owner Occupied Housing Units
by Value, 1983 112
5-8 Number of Elderly Renter Occupied Units by
Gross Rent, 1983 112
5-9 Number of Elderly Renters by Income, 1983 . 113
5-10 Number of Elderly Homeowners by Income, 1983 . 113
5-11 Annual Cost of Maintaining a Retired Couple
in the Denver SMSA...........................114
iii


LIST OF CHARTS
Chart Page
3-1 Population Distribution by Age, 1984 ........... 31
3-2 Estimates and Projections of Median Age of
the U.S. Population 1950-2050 34
3-3 Actual and Projected Change in Distribution of
Children and 65+ Persons 1900-2050 ........... 37
3-4 Percentile Increase of the Older Population
by Decade 1920-2050 39
Map
5-1 Six-County Denver Metropolitan Area ............ 99
IV


r
Abstract
TOWARD A HOUSING POLICY PROPOSAL FOR THE ELDERLY George F. Miller
This project focused on an analysis of the characteristics of the elderly population and their housing situation in the United States. There is presently and will continue to be an ever-increasing number and proportion of elderly people in the United States. It is the premise behind this project that the housing situation for the elderly is poor and will continue to worsen unless all levels of government take a more active approach to housing planning for the elderly.
There are three major objectives of this research project. One of the objectives was to gather together data and information on the elderly and their housing situation that cannot be found in any other single source in an attempt to form a guidebook for any person or group interested in planning housing for the elderly. A second objective was to present in detail the diverse characteristics of the elderly, their housing situation, and past and present policy related to housing for the elderly. The third objective is to outline and analyze alternative policy recommendations in an effort to better the housing situation of the elderly.
This research project utilizes two scales of study. First, the national scale was used to analyze the elderly and their housing on a general basis. Second, the metropolitan scale was used in a study of the Denver, Colorado Metropolitan area in an
v


effort to analyze how the situation differs from the national scale. In addition, a study of the local scale is important because most of the policy recommendations given are meant to be instituted at the local level as this is the level at which most headway could be made in improving the housing situation for the elderly.
To gain a general knowledge of the elderly and their housing, a review of the available literature was undertaken to study aging and the aging process and past housing policy related to the elderly. In addition to this extensive search for previous literature written on the subject, a number of statistical sources were utilized for this project to gain insight to the size and growth of the elderly population, their geographic distribution and mobility, their economic and health status, and their housing situation.
For national statistics, various United States Census Bureau reports were heavily relied upon. In addition, the Annual Housing Survey provided a great deal of data. In the case of Metropolitan Denver, the Census Bureau reports and the Annual Housing Survey were again the basis of the statistical data. In addition, data from the Denver Regional Council of Governments (DRCOG), the Colorado Department of Health and the Elderly Housing Hotline were used extensively.
upon the completion of the data gathering phase, attempts were then made to analyze the data. Correlations between the large number of variables such as age and income and housing condition were analyzed in an effort to better understand the housing complexities of the elderly.
Tne review of the literature and the analysis of the
vi


accumulated statistics provided several major findings. First, and most obvious, is the dramatic increase in the absolute numbers and proportion of the elderly population. Tnere has not, nowever, been a proportionate increase in housing units available to the elderly. In other words, for some portions of the elderly population there is a severe housing shortage. In addition, there has been a severe deterioration of the housing units that are available to the elderly.
It was found that while the elderly poor have very limited housing opportunities and options, the wealthy elderly have unlimited options. Most new elderly housing development is of the exclusive retirement home type in which only the more wealthy elderly benefit.
The elderly and their problems are frequently misunderstood by the general public as well as the decision makers. Many of the generally accepted beliefs about the elderly and their housing were found to be untrue. For example, it is generally thought that the majority of the elderly live in exclusive retirement villages or nursing homes. In fact, neither of these stereotypes is correct. Only 5 percent of the elderly live in nursing homes and less than 20 percent of the elderly move in their last 20 years of life. It is important for decision makers to better understand that the elderly are an extremely diverse population in order to more properly plan for their housing needs.
Another finding is that the elderly who live in Metropolitan Denver are slightly better off than the elderly nationwide.
This is not to say, however, that the elderly in Denver are not in need of help. The elderly in the Denver region are also
vii


facing deterioration of the housing stock and a housing shortage for the poor. In Denver, as nationally, most new development leans toward the exclusive elderly development.
Finally, it was found that past housing policies have done little to help the housing situation of the elderly. In fact, until recently, decision makers at all levels of government neglected the plight of the elderly and their housing situation altogether. Past efforts most likely failed because there was a clear lack of understanding of the future growth and the diversehess of the elderly population.
Therefore, on the basis of the literature review and the data accumulated and analyzed in this research project, a number of potential solutions are then offered To increase the supply of housing to the elderly, four methods are offered. These methods are direct grants, the removal of housing impediments, the revision of certain zoning ordinances, and the use of inclusionary zoning techniques.
The preservation of the existing stock is also extremely important. This may be accomplished through efforts to repair and rehabilitate owner-occupied housing, the initiation of rental rehabilitation programs, the rehabilitation of currently vacant buildings, and a code enforcement program to maintain the housing stock.
Efforts may also be made to aid elderly homeowners so that they are able to stay in their own homes. The "Housing Annuity Plan" provides an opportunity for the elderly to stay in their homes and receive some additional income from the potential new owner of the property. The "Circuit Breaker" program offers to grant property tax relief to the elderly homeowner. The "Home Improvement Plan" is designed to assist
viii


the homeowner with maintenance tasks
Finally, a number of regulatory tools are offered that may be used to protect existing tenants (particularly low and moderate income tenants) from displacement. These tools include rent control programs, eviction and displacement controls and building code variances for the rehabilitation of housing units.
Obviously, then, there are a great number of potential solutions which may be pursued in the attempt to lessen the housing problems of the elderly. Tne ideas offered are by no means a complete list but are offered in this project because they are realistic and offer the most cost efficient methods to better the housing situation of the elderly.
ix


Chapter 1
INTRODUCTION
The United States is an aging society. Demographers often refer to the United States as an "aging population" because the elderly segment of our society is constantly increasing, and forecasts into the future indicate elderly persons occupying even greater proportions of our population than is the case today.
Due to this growth in the number of persons in the 65 and over age group, it is extremely necessary for planning agencies and policy makers to carefully research the characteristics, needs, and lifestyles of older persons in order to develop methods to alleviate the problems that the majority of the elderly face.
One of the more important problems the elderly have deals with housing. The elderly are a diverse population in terms of income resources, health status, and lifestyle preferences. Therefore, housing needs and housing preferences of the elderly reflect the diversity in their personal and social circumstances. An illustration of the numerous problems faced by the elderly is provided by the "housing crisis" among the elderly, the financial hardships of the elderly homeowners and renters, the deterioration of the existing housing stock and the lack of any coherent, effective housing policy.
1


2
It is the assertion behind this research project that past and present housing policies have not met the needs of the elderly in the United States and that there are methods of improving this situation at all levels of government. Planning for the housing needs of the future generations of elderly must be undertaken now, because any decisions made today will have a profound impact on age cohorts for the next half century.
The main goal of this research project is to provide an information base which could prove helpful to any person or group that may have interests in the field of housing; these may include planners, developers, users and policymakers. A main premise behind this research project is that a good data base is essential for the development of public policy.
There are five more specific objectives:
1) To give an overview of the diverse characteristics of the elderly, their housing and policy.
2) To develop trends of population growth within this age cohort.
3) To enumerate the current supply and condition of housing for the elderly at the national and local level.
4) To estimate the short-term demand for housing units for the elderly.
5) To outline and analyze alternative policy recommendations (ones already utilized and original).
Aging is desribed quite differently by different individuals. For the purposes of this study, aging is


3
defined essentially in terms of chronological age. This approach can be justified on the assumption that, for large populations, the aging process, functional age, and physiological age closely follow chronological age. In Chapter 2, aging and the aging process are discussed thoroughly. The demographic approach used most frequently in this project tends to avoid the issue of aging in the individual case and can take advantage of statistical tabulations made from censuses and population surveys for conventional age groups.
For the purposes of this research project, the elderly are defined as those persons 65 years of age and older. The age of 65 is generally accepted as the point in one's life when one becomes "elderly," and is the time for retirement and Social Security benefits. In addition, it is the age where one can receive full Medicare coverage and figures in several important pieces of legislation affecting the older population including federal and state tax laws.
Since the older population is not a single homogeneous mass and its characteristics tend to vary sharply with age, it is desirable in any analysis of the older population to consider the group in terms of component age groups. The U.S. Bureau of Census has the following classifications:
65 and over - the elderly
75 and over
85 and over
the aged
the extreme aged.


4
Another commonly used description is the 65-75 age group being known as the "young-old" and the 75 and over age group known as the "old-old."
At these older ages, the impact of aging in the form of changes in the individual's physical condition (e.g., survival, health) and social and economic characteristics (e.g., labor force participation, income, housing) is most pronounced and of special public concern.
As was mentioned, the major objective of this research project is to gather together data about the elderly and their housing situation and to offer alternative solutions and policy recommendations. It is first necessary to gain a general knowledge of the areas of concern. To accomplish this, a review of the literature was undertaken on three topics to provide a frame of reference. The three topics analyzed are aging and the aging process, past housing policy and the development of policy in general.
After that has been accomplished, the national characteristics of the elderly are studied. The size and growth of the elderly, their geographic distribution and mobility, their economic status and their health status are all considered so that one may begin to realize the vastness and diversity of this population. Likewise, the elderly's housing situation is carefully studied by using data sources such as the U.S. Census and the Annual Housing Survey. In addition to a study of the housing stock in absolute numbers, the condition of the housing for the elderly is


5
considered. Through this analysis, the problems of the elderly and their housing become more evident.
At this point, the metropolitan area of Denver, Colorado is used as a "case-study." The population characteristics and the housing situation are both studied closely by using Census, Annual Housing Survey, Denver Regional Council of Governments, Colorado Department of Health, and Elderly Housing Hotline statistics. The trends in population and housing stock are developed and housing needs for the elderly are determined.
Next, the current housing policies at both the federal level and the local (for the Denver Metropolitan area) level are analyzed. From this analysis, it becomes obvious that the current housing policies for the elderly are less than desirable.
Finally, conclusions are drawn from the concepts and data that have been accumulated and a number of policy recommendations are made and analyzed with the intent of improving the housing situation of the elderly.


6
Chapter 2
AGING AND HOUSING POLICY: AN OVERVIEW
By reviewing available literature, this portion of the research project has been designed to create a theoretical frame of reference. Literature in two general areas has been reviewed: gerontology and housing policy.
The section on gerontology includes a discussion of the diverse forces of aging, the adaptations of the aging individual in terms of his status and his relationships in society, and the general theories of aging.
The section on housing policy incorporates a historical perspective and an evaluation of the major housing legislation acts since 1934. There is an attempt to discuss why housing policy for the elderly has not been successful and why there still is an absence of a coherent, comprehensive national housing policy for the elderly.
In addition there is a brief overview of public policy in general and its process. Selected literature has been reviewed in this context in order to create a frame of reference in which public policy is made.
Gerontology
1. Studies of the Aging Process
The increase in absolute numbers of the middle-aged and the increase in the average life expectancy in the United States have contributed to a new condition: the rapid


7
increase in the elderly population. As has been mentioned, this phenomenon has called for action from government and policy makers. Aging as a social problem, however, has only received recognition in more recent times.
The aging process involves a broad range of forces and issues. Starting in the 1960s, and continuing today, researchers from many different fields have examined the physical, psychological, economic and social parameters of aging. An excellent overview of the large and diverse literature available in the field of aging is found in the works of Brody (1971) and Huffman (1977). In this research project, however, only the literature most closely related to the research question involving the elderly and their housing is reviewed. In other words, this is a selective review of the existing body of literature in gerontology and it will attempt to provide a better understanding of the elderly, their spatial distribution patterns and their needs with regard to housing.
Davis (1977) and others have discussed the various issues relating to the aging process and they concluded that they are interrelated as age grading systems are found in all aspects of social structures. To varying degrees, these age grading systems are characteristic of economic, political, religious and legal institutions in society. In other words, people are susceptible to all kinds of regulations as a function of their chronological age. Chronological age is used to identify the beginning and the ending of social roles and age is used as a measurement to qualify or


8
disqualify individuals in terms of participating in the social system. Aging has been viewed as an adaptation process in which a person has made adjustments in response to changes in his biological and psychological functioning as well as to changes in his social environment. In this research project, the relationship of aging, housing choices and mobility is explained in later chapters.
2. Theories of Aging
There are several theories of aging and a good review is provided in the work of Busse and Pfeiffer (1969). Two very distinct theories are examined in this research project. Both theories focus on the final stages of the life span and the individual's relationship to the environment.
Cummings and Henry (1961) were among the first to attempt to explain the aging process as the withdrawal or the disengagement between the aging person and others in the social system. The process of disengagement can be perceived in terms of the social and psychological adjustments that the elderly person must make and it can be initiated by the individual himself or by others in society. Rosow (1969) stated in his work that the elderly population lacks clearly defined roles in society. The disengagement theory, then, operates under the premise that with the increase in chronological age, an individual experiences a loss in social roles and relationships as well as in the range of activities. Retirement and widowhood are two examples of


9
changes in the social roles of the elderly. Stern et al. (1974) reported that with increasing age, the residential mobility declines. In addition, many elderly experience economic limitations which can be seen in more detail in the following chapter. Binstock and Shanas (1976) stated in their research that the retirement income of the elderly is far below what is needed to keep up their former lifestyles. Income and state of health are among the more important variables of aging and Chatfield (1977) stated in his study that the lower level of "life satisfaction" of the elderly primarily resulted from the loss of income and health problems. Wiseman (1978) reported that people perceive the three most important problems of aging as poor health, loneliness and poverty. Kasschau (1978) interviewed policy makers in her extensive research project on aging and found that even many policy makers believe that the majority of elderly are in poor health and are institutionalized. This common belief is inaccurate. National statistics show that only approximately 5 percent of elderly are in nursing homes and that even in the 85 years of age and older age group only about 20 percent are institutionalized. These statistics are important because they help show the fact that the elderly tend to stay in their own homes as long as possible and will normally consider a change only if their health makes such a change necessary. Moreover, according to Atchley (1972) and Wiseman (1978), a large proportion of the elderly are in relatively good health and enjoy independent


10
living. Home ownership is common among the elderly population. It has been recently estimated that approximately 70 percent of all elderly live in their own homes.
The loss of income, the decrease in mobility and the ambiguity of the social role can be viewed as steps toward disengagement. While there is disagreement in the literature over the application of the theory, the disengagement approach has provided valuable insights and a better understanding of the aging process. Studies have shown that there are variations in the degrees as well as the timing of the disengagement of individuals. It can, therefore, by hypothesized that it is not aging per se that determines the disengagement process, but rather a combination of factors associated with the aging process.
At the other end of the spectrum is the activity theory. This approach was formulated in direct response to the disengagement theory. The activity theory is based on the role of external forces influencing the psychological functioning of the elderly. Although many have discussed this approach in their writings, it must be noted that there has never been a formal statement of the theory per se. The activity theory operates under the premise that normal aging processes involve, as long as possible, maintenance of the activities and attitudes of middle age and new substitutes have to be found for the activities as well as the social roles that the aging person had to give up. Rose et al. (1975) argue that the best estimate of how active the elderly are at any particular age is based on the previously


11
established patterns of social learning and interaction. In other words, they argue that only by understanding the previous lifestyles can one predict the degree of engagement or disengagement of individuals in society. It can, therefore, be hypothesized that the elderly value home ownership and independent living and this is a reflection of traditional American cultural values. The activity theory infers that maintaining activities and social roles is conducive to life satisfaction and successful aging.
Both theories attempt to show that activity or disengagement is positively related to successful aging and they have contributed to the better understanding of aging as an adaptation process. However, the two approaches lack conclusive data and therefore cannot offer prescriptions for successful aging. The research findings can, however, have a potential impact on the policy planning strategies for the elderly. The data that will be found later in this research project suggest that the two theories of aging have application to the elderly population at the national level and the metroplitan level. The data will indicate that the elderly tend to stay in their original neighborhoods, and will show the changes that take place in the elderly's environment in terms of income and housing.
It has also been shown that the disengagement can be replaced by "reengagement" in certain situations. Wiseman (1978) reported that attitudes toward retirement are becoming more positive. Leisure time activities have increased


12
over the past decade. These activities of the elderly population are closely associated with income and, therefore, the type of activity may vary. Crawford (1979) studied the elderly that moved into elderly housing complexes and concluded that such a move could be viewed as a form of reengagement. It will be shown, however, that the majority of the elderly have chosen not to make adjustments such as a residential move. In addition, the elderly as a group are relatively poor and it may be possible that the elderly lack the money and motivation to become reengaged into society. It could be speculated on the basis of the two theories on aging that in the event the elderly had more money at their disposition, they may be inclined to continue their lifestyle they had prior to retirement, to keep up their properties, and to find new ways of becoming reengaged in society after the loss of the work role.
It is clear that both the disengagement theory and the activity theory provide some explanation of the aging process and they have been summarized in this context in order to create a frame of reference. It is obvious, however, that a better understanding of the aging process is needed and that research in the area of gerontology must continue. For the purposes of this research project, however, the above discussion on aging is important to take into consideration in the attempt to make policy recommendations .
In the next section of this chapter, it will become evident that policy makers have known too little for too


13
long about the aging process and the needs and housing preferences of the elderly population. An illustration of the numerous problems is provided by the housing crisis among the elderly, the financial hardships of the elderly homeowners and renters, the deterioration of the existing housing stock and the lack of coherent, effective housing policy for the elderly.
Housing Policy
In addition to an historical perspective and an evaluation of past and present major housing policies, this section will attempt to discuss why the fundamental economic and social problems have remained largely unchanged by past public housing activity devoted to the improvement of the life circumstances of the elderly. It remains difficult to assess how much of the failure of the public policy to adequately address the problems of the elderly is due to the magnitude and the complexity of the issues, and how much to inefficient intervention strategies and the lack of social planning. As has been mentioned, the elderly are a diverse population in terms of income resources, health status, lifestyle preferences and therefore, housing needs and housing preferences of the elderly reflect the diversity in their personal and social circumstances. The existing array of federal housing programs to assist the elderly demonstrates the absence of a coherent, comprehensive national housing policy for the elderly.


14
1. Housing Policies in the 1930s and 1940s
Historically, the overview of the federal housing policies begins with the passage of the 1934 Housing Act.
The Act was designed to assist middle-class American homebuyers and to stimulate the housing market during the Depression by establishing the Federal Housing Authority (FHA). The main purpose of the FHA was to administer the loan guarantee program. While several other housing programs have been implemented since the passage of the 1934 Housing Act, the FHA has remained and has continued to play a role in federal housing programs.
The oldest and largest federally supported housing program, begun in 1937, is low-rent public housing. The new Housing Act also established the Local Housing Authorities (LHAs), whose mission it was to manage all public housing within their jurisdictions. Farb et al. (1975) reported that the LHAs over the years established a wide range of restrictions on the construction and rental of the public housing units or "projects" as they are commonly referred to. These public housing units represent less than 1 percent of the total housing market. The LHAs have continued to play a role in the various housing programs.
According to Zais (1982), the federal housing programs have produced over 1.2 million units of public housing which may house as many as 800,000 elderly. This figure, however, only represents about 3 percent of the elderly.
In 1949, federal legislation was passed in order to better deal with the nation's housing problems. The act


15
promised to provide every American with a decent home in a suitable environment. The federal government became involved in the concept of urban redevelopment as the legislators became aware of the urban housing situation. Under this act, the municipal governments were encouraged to acquire and clear slum properties and to sell them to private investors and developers at a price lower than market value and the difference would be made up by the federal government, This piece of legislation did lead to misuse and discrimination against families in the name of city beautification and redevelopment of neighborhoods. The program did not provide assistance to the poor or the elderly and therefore did not improve their housing situation. Section 115 of the 1949 Housing Act provided rehabilitation loans, but the majority of low income individuals did not make use of the programs, because there were many restrictions attached to it in terms of the location as well as the use of the property. In 1950, the First National Conference on Aging criticized the 1949 Act and urged the establishment of housing programs for the elderly.
2. Housing Policies in the 1950s and 1960s In response to the criticism being leveled at the 1949 Housing Act, Congress passed the National Housing Act in 1954. This act is generally referred to as the Urban Renewal Program. The program was designed to eliminate slums and urban blight as well as to improve housing in


16
general. It may be said that as a housing strategy, the policy was a failure, because it was costly and it destroyed considerably more units than it rebuilt. A large number of low income families were forced to relocate under this program, but they were unable to get better housing at costs affordable to them. The policy tended to neglect the interests of the poor and favored the interests of private developers and financial institutions. The policy can be, however, credited with the renaissance of some downtown business districts in the United States. The policy has been described in the literature as a multi-billion dollar enterprise with rather insignificant contributions to the nation's housing problem.
According to Pole (1974) and Zais (1982), the 1954 housing legislation was viewed as highly controversial and the act was amended in 1956 to establish the General Neighborhood Renewal Program which authorized the first large scale construction of non-profit housing for the elderly. Many elderly in low income neighborhoods across the nation were forced to relocate due to the Urban Renewal Program. In order to assist the elderly in their search for housing alternatives, the Local Housing Authorities were instructed to give priority to the elderly in their admission policies. The act was amended again in 1959 to introduce the concept of Community Renewal.
Section 202 (which would later be incorporated into Section 236) of this act was established in direct response


17
to the problems created by the Urban Renewal Program which destroyed a large number of units. It provided a direct loan program to families with incomes slightly above average and the expansion of the low rent public housing for the elderly. Although there were no specific figures available, the estimates are that only a small number of elderly were rehoused under this program. The review of the literature leads to the conclusion that the enactment of the amendments did not aid the elderly but the programs did help the poor in general. The Urban Renewal Program was widely criticized and by 1960 the program was in disrepute.
In 1964, Congress enacted additional legislation to expand the low-rent public housing program. The act also included aid to dislocated persons, rental assistance and rehabilitation loans and an attempt was made to correct some of the problems created by the Urban Renewal Program. However, the legislators still perceived the monetary reimbursement as the cure-all for the housing situation. In 1965, the Housing and Urban Development Act was passed to extend the existing federal housing programs and to authorize grants for home rehabilitation and neighborhood facilities. For the first time, it appeared that policy makers were changing their philosophy in that they realized that the mere provision of money or some sort of public housing did not translate into services and housing for the elderly and, therefore, did not solve the problems of the elderly. HUD was in charge of the administration of these programs and it established certain guidelines to insure the


18
proper use of the funds. However, it proved to be a very difficult task for HUD to monitor the municipal governments and hence, many of them applied the guidelines only in a superficial manner. So, while there was little or no integration of housing and service components, there was a small beginning of a changing attitude that could be recognized in the limited number of demonstration projects and their management by HUD.
In 1966, the Model Cities Program was passed by Congress. Previous housing legislation largely emphasized the physical improvements; this act was designed to incorporate the social, economic and physical aspects of a community. This act represented a departure from the shortsighted incremental approach and a more comprehensive approach with high expectations was adopted. Despite the good intentions of the program as well as the high cost, the program did not help the poor or the elderly in any significant way, with the exception of some demonstration projects. The program was eventually discontinued and new housing legislation proposals were introduced in Congress.
The next important piece of legislation in the area of housing was the passage of the 1968 Housing and Urban Development Act. The elderly benefited from this legislation to some limited extent through the Section 235 subsidized home ownership program and the Section 236 rental subsidy program. The end result was that the poor and the elderly did not benefit nearly as much as did the private


19
investors and realtors who took advantage of the subsidies of building costs. Another major problem associated with this program was that there were no subsidies allocated for the actual operation of the structures which meant that many of the structures fell quickly into disrepair. Because the operation of the projects was not subsidized, the management portion was not nearly as attractive and profitable to private investors and hence, it was neglected. Section 235 did move the federal government from the position of a reactor to that of a pro-active catalyst because it was hoped that under Section 235, private enterprise would enter into the housing market and help alleviate the housing shortage.
The programs established under the 1968 act became "scandal ridden" by 1972 and ended with President Nixon's moratorium in 1973 on all rehabilitation and new construction subsidies. In the literature, the programs are generally viewed as a failure and the multi-billion dollar efforts as ineffective and wasteful. The elderly renters benefited to some extent from the programs, whereas the elderly homeowners appear to have lost out on this program altogether. Private enterprise, however, had derived profits from the program and had contributed to the misuse of funds from the federal government designated to aid the poor and the elderly to obtain adequate housing. There is still another problem associated with the 1968 act. With the increase of federal spending, the federal government and the numerous administrative agencies played a major role in


20
the decision making process. State and local governments were left only with the initial decision of whether or not to apply for a particular program for their community.
After the application had been approved, the federal government would administer the program. The federal regulations were defined so rigidly that any local deviation was not possible and therefore, local input and control were eliminated in the process. In a report by the White House Conference on Aging (1971), the nation's housing policies were reviewed and it was concluded that more needed to be done to aid the elderly.
3. Housing Policies in the 1970s and 1980s
In 1970, the Housing and Urban Development Act was passed, approving the construction of congregate housing and Section 504 of the act authorized HUD to establish the experimental program to test the concept of housing allowances. HUD has since reported that congregate housing proved to be very costly as the operating costs were not met by the operating incomes and therefore federal subsidies were required to cover the expenses. HUD has also evaluated the housing allowances program and found that the cash to low income families to pay for adequate housing under this program was often used to pay for other expenditures, and that this program did not significantly improve the housing conditions of the poor or elderly. This act, however, represented a beginning of a shift of power to local government units and permitted them to devise some of their


21
own programs according to the needs of their respective communities.
In 1972, Congress passed the State and Local Fiscal Assistance Act, generally referred to as the Revenue Sharing Act. This legislation provided 30 billion dollars to state and local governments to be used as they determined. Few restrictions were associated with the funds, only that the money would be used in a non-discriminatory manner. One-third of the revenues would go to states and two-thirds to units of local governments. The funds were allocated according to a complex formula based on population, per capita income and state and local taxing efforts. Regional offices were set up to assist state and local government units and the Advisory Commission in Intergovernmental Relations (ACIR) played a major role in the revenue sharing approach. According to Steadman (1979) and Adrian (1979), revenue sharing gained wide support among state and local governments. It lessened the burden of writing grant applications, it increased local control and it allowed state and municipal governments to hold down taxes without forcing cuts in services.
More than three years after its introduction in Congress, the Housing and Community Development Act of 1974 was signed by President Ford. This act represented a deviation from previous housing programs and it represented a significant change in the relationship between federal government and state and local governments. In the 1970s,


22
the strategy in the area of housing became that of neighborhood preservation. Under the provisions of this act, local government became the focal point for community planning and hence, the operative theory of the act was that local governments can best determine and meet local needs. The legislators apparently realized that profits from the production of inner-city housing and urban redevelopment had not been high enough so that the housing market alone could provide adequate housing for all Americans. It became obvious that governmental housing policy must come together in the market system and should not be separate from it.
Also obvious was that the mere provision of incentives in the form of loan guarantees and tax shelters that were intended to attract private enterprise, did not bring about satisfactory results and did not significantly improve the housing problems. The implementation of the approach referred to in the 1974 Act poses a great challenge and opportunity to local governments to solve the housing problems.
4. Elderly Participation in Programs
The oldest and largest federally supported housing program, begun in 1937, is low-rent public housing. In 1981, there were approximately 1.2 million federally supported units of public housing. In the larger cities, public housing constitutes between 5 and 8 percent of the entire rental housing stock. It is estimated that as many


23
as 800,000 elderly are housed under this program which is only about 3 percent of the entire elderly population.
The Section 8 program was enacted as part of the Housing Act of 1974. In 1981, the Section 8 program was almost as large as the public housing program with 1.1 million units occupied. The program was designed to provide more housing for the poor. Section 8 is primarily concerned with leased housing and it provides rent subsidies for sound existing housing, rehabilitated housing and newly constructed housing. For the "existing" portion of this program, the government pays the landlord the difference between the actual market rent of a unit and the rental contribution of the tenant. At the start of the program, this was calculated to be 25 percent of the household's adjusted income, until the law was changed in 1981 to raise this percentage gradually to 30 percent. In addition to the "existing" segment of the program, there is another segment that deals with new construction and substantial rehabilitation. Unlike the other segment, this provides a guaranteed rental stream to developers who build or rehabilitate under this program.
The Section 202 program was creaed by the Housing Act of 1959, but has been revised often since then. The program is unique in that it is restricted to servicing the elderly and the handicapped, and it relies on non-profit sponsors to develop and operate the projects. The projects built under Section 202 are expected to provide more than just shelter as they are to include health care facilities and other services. Overall, however, the Section 202 program has


24
accounted for only an estimated 50,000 units by 1981. Obviously, the Section 202 represents a departure from the Housing Act of 1974 philosophy of relying more heavily on units from the existing stock. No recent or adequate data could be found on the types of households that are being served by the program but theoretically a large proportion should be poor elderly households.
There are several other programs, which, when totaled together, assisted about 750,000 households. Most of the programs, however, were being phased out even before the Reagan administration took office. The largest of these programs is the Section 236 which included over half a million units. Section 236 was created by the Housing Act of 1968. The program provided subsidies to reduce the interest rate paid by developers of multi-family housing projects and therefore reduced the rents to tenants. The program included new or substantially rehabilitated rental or cooperative units for lower income households. In addition, there are several other currently inactive programs that continue to serve renter households. Section 231 was a mortgage insurance program designed to offer the frail but mobile elderly an alternative to nursing homes and hospitalization. By 1981, about 65,000 units were insured under this program. Also, Secion 221(d)(3), a below market interest rate program for new construction, continued to serve about 50,000 households. Table 2-1 gives an overview of HUD subsidized rental programs, with the


25
estimated number of occupied units in each program at the end of 1980. The table also gives figures on estimates for the number of units in each program which were occupied by elderly heads of households. About 1.2 million or 39% of all assisted units were elderly occupied (see Table 2-1).


26
TABLE 2-1
OCCUPANCY BY THE ELDERLY IN HUE-SUBSIDIZED RENTAL PROGRAMS. 1980
Housing Program Total Units (000's) Elderly Units (OOC's) % Elderly
Public Housing 1,192 443 37.2
Section 8 588 195 33*1
Existing 583 195 33.1
New Construction 242 164 67.9
Rehabilitation 35 13 50.0
Loan Management 288 124 43.1
Section 236 538 222 41.2
Bent Supplements I65 22 13.1
Section 221 (d)(3) 50 5 10.0
Section 202 50 40 80.0
Total 3,148 1,233 39-2
Sources U.S. Department of Housing and Urban Development F Y 1982 Budget


27
In addition, the 1974 Housing Act provides two types of assistance to elderly homeowners: the property tax relief programs and the rehabilitation grants and loans. Also, income tax rules now allow special provisions for homeowners and for elderly to benefit to some extent from these indirect subsidies. With the exception of these few types of assistnace available to the elderly homeowner, the 1974 Housing Act has been criticized in the literature for stressing the rental arrangements to the neglect of home ownership. As a whole, however, the 1974 Act does imply a commitment to the elderly as a social group and a greater flexibility of state and local governments to deal with the unique needs of the community.
Obviously, then, the housing policy for the elderly has come a long way from the first attempts to solve this nation's housing problems. The decision makers have often failed to recognize the elderly's special problems, needs and preferences with regard to housing. It should also be clear that new policy is needed with the intent to provide the elderly with affordable, safe and sound housing opportunities.
The purpose of this research project is to gather relevant data on the elderly and their housing and to recommend some solutions to their housing problems and to offer potential policy options that policy makers may take into consideration. It is important to point out that the policy recommendations offered at the end of this research


28
project are just that recommendations. Actual decision makers are necessary to consider and debate any policy recommendation so that it may meet their specific jurisdictional needs.
The urban policy maker is normally seeking a base of knowledge to which decision appeal can be made. The creation of such a knowledge base is essentially a research task. Such research affects policy by providing information that enables policy makers to estimate various parameters of a problem or to choose among competing hypotheses. Solid research, however, is more than just providing data or information. Perhaps the greatest influence that good research can have on policy development is through its effect on the way policy makers look at any particular situation.
The next chapters of this research project, then, are mainly concerned with gathering the necessary data and outlook so that one is able to make a rational decision on the housing needs of the elderly. The final chapter will reflect back on much of what has been stated in this portion of the research project and will attempt to outline a number of policy recommendations.


29
Chapter 3
CHARACTERISTICS OF THE ELDERLY
As was mentioned in the previous chapter, policy making requires a great deal of research and data gathering. It is the purpose of this chapter to gather together much of the relevant data and to analyze what these characteristics may mean to the elderly and their housing. The first section of this chapter is divided into three parts: (1) the size and growth of the older population; (2) the geographic distribution and mobility of the elderly; and (3) the economic status of the elderly. The following section will incorporate housing statistics in a discussion of the elderly and their housing.
1. Size and Growth of the Older Population
When studying the housing situation of the elderly in the United States, it is first necessary to recognize the size and growth of the older population. This is necessary so that decision makers can make an accurate assessment of the demand and need of such services as housing.
The older population has increased far more rapidly than the rest of the population for most of this century.
At the beginning of the century, 1 in 25 people was over 65 years of age and in 1984 1 person in 9 was over 65. In the last 20 years, the 65 and over population grew by 54 percent while the under 65 population increased by only 25 percent. Since 1960, an average of 150,000 persons a month have


30
joined the ranks of the elderly. These figures are but a few that lead to the same conclusion: America is an aging society.
Table 3-1 displays the country's dramatic increase in the number and proportion of older persons. In 1984, there were approximately 50.2 Americans age 55 and older and 28 million who were at least 65. About 9 percent (22.2 million) of the total population were 55 to 64 years old. This number is important to decision makers because it is obvious that there will be a huge influx of "new" senior citizens in the next decades. Seven percent (16.6 million) persons were 65 to 74 years old, 3.7 percent (8.8 million) were 75 to 84 years old and about 1 percent (2.6 million) of the entire United States population were 85 years old or over (see Table 3-1).


31
TABLE 3-1
DISIRIBUII0N_0F_THE_PQPyLATigN_BY_QLpER_AGE_GR0yPSA_19B4
Aae Group Number Percent
All Ages 236,416,000 100
0-54 186,220,000 79
55 + 50,195,000 21
65_+ 27.985.000 12
55 64 22,210,000 9
65 74 16,596,000 7
75 84 8,793,000 4
85 + 2,596,000 1
Source: U.S. Bureau Reports Series P-25, o-f Census, Current No. 952. Populati on
CHART 3-1
POPULATION DISTRIBUTION BY AGE, 1?S4
Numbers in Killicns
0 -19
20 39 LO 59
60+
10 20 30 40 50 60 70 0 -00 1
0-4 5-9 10 - 14 15 19 "
20 -24 2r> - 29 30-3^ 35 39
40-44
6o-64 £5-69
45-^9
50-5^
?0-?L 75+
55-59
Source: U.3. Bureau of Census, Current Population Reports Series P-25, No. 952.


32
Chart 3-1 simply displays the country's age distribution in 1984 and provides the justification of the statement "America is an aging society." The "baby-boom" generation (age 20-39) which dominates the graph is the result of increased fertility after World War II from 1946 to 1962. This generation will dominate the age distribution of the country well into the next century. In fact, it is projected that by the time this group reaches 65 early in the 21st century, it will swell the 65 and over age group to the point that one in every 5 Americans will be elderly.
It is commonly assumed that today's large numbers and proportion of the elderly are caused by increased longevity. This is only partially true. The primary cause is an increase in the annual number of births prior to 1920 and after World War II. The aging of the pre-1920s group, along with the dramatic decline in the birth rate after the mid-1960s, has contributed to the rise in the median age of the U.S. population from 28 in 1970 to 31 in 1984.
The projected growth in the older population will raise the median age of the U.S. population from 31 today to 36 by the year 2000 and to the age 42 by the year 2010 (Chart 3-
2). This incredible growth that is expected in the elderly's absolute numbers and proportion is evidenced in Table 3-2. This is perhaps the best illustration of the need to start planning for this influx now. Housing for these large numbers of elderly is a critical issue in the


33
present and will be increasingly critical in the future as the elderly begin to dominate the age cohorts (see Chart 3-2 and Table 3-2).


CHART 3-2
34
KTIKAT£S-AHD-MlJSGTIQliSJffiJSai^-AgL.C£-ZSaJl^ffiaiLm01i 1SSQ=2QSD
^5
Median 40
Age 35
30
25
1950 i960 197C 1980 I9SL 1990 200C 2010 2C3C 2030
Year
Source: U.S. Bureau of Census, Current Population Reports, Series P -23, No. 952.
ACTUAL AND PROJECTED GROWTH OF THE ELDERLY. 1960 - 2050
Year Total populati on al_i_ages (Numbers in Thousands) 65 74 75 84 85 + number V. number V. number V. 65 + number V.
I960 179,323 10,997 6 4,633 3 929 1 16,560 9
1970 203,302 12,447 6 6,124 T O 1,409 1 19,980 10
1980 226,505 15,578 7 7,727 O 2,240 1 25,544 11
1990 249,657 18,035 7 10,349 4 3,313 1 31,697 13
2000 267,955 17,677 7 12,318 5 4,926 *£. 34,921 13
2010 283,238 . 20,318 7 12,326 4 6,551 n 39,195 14
2020 296,597 29,855 10 14,486 5 7,081 2 51,422 17
2030 304,807 34,535 11 21,434 7 8,612 3 64,581 21
2040 308,559 29,272 10 24,882 8 12,834 4 66,988 nn
2050 309,488 30,114 10 21,263 7 16,034 5 67,411 22
Source: U.S. Bureau o-f Census, Current Population Reports Series P-25, No. 952.


36
The increase in the older population is expected to occur in two stages. Through the year 2000, the proportion of the population age 55 and over is expected to remain relatively stable, at just one in five (22 percent). By 2010, because of the aging of the baby boom, the proportion of older Americans is projected to rise dramatically; more than one-fourth of the total U.S. population is expected to be at least 55 years old and one in seven Americans will be at least 65 years old. By 2050, one in three persons is expected to be 55 years or older and one in 5 will be 65 and over.
One of the more dramatic examples of the changing age distribution of the American population is the shift in the proportion of elderly in relation to the proportion of young persons (Chart 3-3). In 1900, four percent of the population was age 65 and over while young persons, age 0-19, made up 44 percent of the population. By 1980, the proportion of the 65+ persons had increased to 11 percent and the proportion of young persons had decreased to 32 percent. U.S. Census Bureau forecasts predict that, by the middle of the next century, the proportion of young persons and elderly will be almost equal, with persons 0-19 years equaling 23 percent and the elderly equaling 22 percent of the population (see Chart 3-3).


37
CHART 3-3
actual and projected chance in distribution of children and 65+ PERSON IN THE U.S., 1900-2050.
Sources U.3. Bureau of Census Current Population Reports Series P-25 No. 592


38
Oldest Old
The 85 and over population is the fastest growing age group in the country. Chart 3-4 displays the growth of the 85 and over population in relation to the 65-74 and 75-84 age groups. This part of the population is also expected to triple in size between 1980 and 2020 and increase seven times between 1980 and 2050. While the increase in the "very-old" population is one of the major achievements of improved disease prevention and health care in this century, it has far-reaching implications for public policy because of the high probability of health problems and need for health and social services for this age group.
Aging of the Elderly Population
With increases in the number of people surviving into the upper age ranges, the elderly population is growing older. In 1980, the "young-old" (age 65-74) outnumbered the oldest-old (age 75 and over) by three to two. By the year 2000, however, half of the elderly population is expected to be age 65 to 74 and half will be age 75 or older (see Chart
3- 4) .


39
CHART 3-4
PERCENTILE INCREASE OE THE OLDER PCPULATICN BY DECADE 1920-2050
Source: Aging America 19S4, Senate Special Committee on Aging and the American Association of Retired Persons


40
Race and Ethnicity
In 1984, the non-white population (black, Hispanic and "other") had a smaller proportion of elderly than the white population. Thirteen percent of whites and only 8 percent of non-whites were age 65 and over. The difference is most likely a result of higher fertility and higher mortality below the age of 65 for the non-white population than the white population.
These proportions are expected to remain relatively stable over the next few decades. In the early part of the next century, however, the proportion of elderly persons is expected to increase at a higher rate for the non-white population than the white population.
At the present time, whites are disproportionately represented in the elderly population. In 1984, 91 percent of the 65+ population were white and 4 percent were nonwhite, while in the total population, 85 percent were white and 15 percent were non-white.
Sex Ratios
The ratio of females to males varies dramatically with age. In the under-20 age group, for instance, the 1980 Census found 35.5 million women versus 37 million men. The 20 to 24 year age group was evenly balanced at about 10.7 million each. But, for the 65-plus age group there were 15.2 million women and 10.2 million men.
This disparity becomes more obvious in the upper age ranges. In 1984 there were 81 men between 65 and 69 years


41
for every 100 women in the same age group. Among those 85 and over, there were only 40 men for every 100 women.
These statistics reflect the fact that on the average women live longer than men and therefore, are more likely to end up living alone. Because of these factors, elderly women average a longer period of retirement than elderly men during which time they must rely on private and public sources of retirement income.


42
Marital Status and Living Arrangements
The marital status and living arrangements of older persons vary tremendously between males and females.
Approximately two thirds (67 percent) of older non-institutionalized persons lived in a family setting in 1983. However, patterns of living arrangements and marital status differ sharply between elderly men and women, and the disparity increases for the oldest groups. For example, in 1983 nearly three quarters of the men and less than half of the women age 75 and older lived in a family setting.
Elderly women are more likely to be widowed than married, and a substantial proportion live alone. The male/female ratio is more obvious at older ages; in 1984, 67 percent of women 75 and older were widowed while 67 percent of the men in this age group were still married. And, in 1983, 65 percent of men 75 and older lived with their wives while only 21 percent of the 75 and over women lived with their husbands. According to Jacob Sieger (1982) these differences are caused by the combined effects of the higher age-specific death rates for adult men and the tendency for men to marry younger women.
Elderly widowed men have remarriage rates about seven times higher than those of women. For those whose marriage is terminated by death of a spouse, on average, both males and females are in their late 60s. However, the mean duration of widowhood for females is twice that for widowers (14.3 years v. 6.6 years).


43
Relatively small numbers of elderly live in inter-generational households with children or with other relatives, although this percentage does increase with advancing age, particularly for older women (see Table 3-3 and Table 3-4).


44
TABLE 3-3
LiyiNG_ARRANBEMENIS_DF_0LpER_MALES_AND_FEMALESJ._1983
Age 7. M 55-64 7. F Age 7. M 65-74 7. F Age 7. M 75 + 7. F
Not in Household 1 1 2 1 8 13
Living Alone 9 17 12 36 19 42
Living in Household Mith Someone Other than Spouse 6 15 7 15 8 24
Living in Household with Spouse 84 67 78 49 65 21
TABLE 3-4
MARITAL STATUS OF OLDER MALES AND FEMALES, 19B3
Age 55-64 Age 65-74 Age 75 +
7. 7. 7. 7. 7. 7
M F M F 0 F
Single 5 4 5 5 4 6
Married - Spouse Present 83 66 80 49 67 23
Married Spouse Absent 2 3 2 2 3 1
Widowed 4 17 9 39 24 67
Di vorced 6 9 4 5 2 3
Source: U.S. Bureau o-f Census, Current Population Reports March, 1983.


45
Support Ratio
The "elderly support ratio" is the number of 65+ persons to persons of working age 18 to 64 years. The fact that people are living longer and families are having fewer children is changing the shape of this support ratio by resulting in growth in the ratio of elderly persons compared to persons of working age.
In 1900, there were about seven elderly persons for every 100 persons of working age; in 1984, this ratio was almost 19 elderly persons per 100 of working age. By 2020, the ratio will rise to about 29 per 100 and is expected to increase rapidly to 38 per 100 by 2050.
The "support ratio" is important because, in economic terms, the working population can be thought of as supporting non-working age groups. However, a "support" or dependency ratio is a crude measure since many younger and older persons are in the labor force and not dependent while many persons of labor force age may not be working. Although the total support ratio (young and old combined) is expected to increase in the next century, it has declined substantially since 1900. This would suggest that fewer economic demands are currently placed on working age Americans for supporting the young and old.
From a public policy standpoint, however, the decline in the total support ratio, caused by a large decline in the number of children, masks the rise in the elderly support ratio. This is an important distinction because it is


46
primarily publicly-funded programs which serve the elderly while mostly private (i.e., family) funds are directed toward support of the young (see Table 3-5).


47
TABLE 3-5
YOUNG, ELDERLY AND TOTAL SUPPORT RATIOS, 1940 2050
Year Elderly Young Total
1940 10.9 51.9 62.8
I960 16.8 65. 1 81.9
1980 18.6 45.8 64.4
1990 20.6 41.9 62.5
2000 21.1 40.7 61.8
2010 21.9 36.2 58. 1
2020 28.7 36.9 65.6
2030 37.0 37.8 74.8
2040 37.9 36.7 74.6
2050 38.0 36.6 74.6
Source: U.S Bureau o-f Census, Current Population Reports Series p25, No. 952.


48
Life Expectancy
The average expectation of life at birth is now at an all-time high. This increase continues a remarkable upward trend in life expectancy since the beginning of the century. The greatest gains occurred during the first half of the century, largely due to the dramatic reductions in deaths due to infectious diseases. By 1984, life expectancy at birth was 74.7 years of age. Although in the early part of this century increases in life expectancy were due to decreases in deaths of infants and children, most of the increasing life expectancy since 1980 has been due to decreased mortality among the middle aged and elderly population (see Table 3-6).


49
TABIZ 3-6
LIFE EXPECTANCY AT BIRTH AND ACL 65 BY SEX AND YEAR, 1900-2040
MALE FEMALE
At Birth & At Birth 6£
1900 46.4 11.3 4q.o 12.0
1920 5^.5 11.8 56.3 12.3
1940 61.4 11.9 65.7 13.4
I960 66.7 12.9 73.2 15.9
1980 69.9 14.0 77.5 18.4
2000 72.1 14.8 79.5 19.5
2020 72.7 15.2 80.1 20.1
2040 73-3 15.6 80.7 20.6
Sources Social Security Administrations Projections, 1984. S.S. Area Populatic


50
2. Geographic Distribution and Mobility
On the average, older persons tend to move far less often than younger persons. This geographic stability of the older population is causing a "graying" of some areas of the country where older persons have stayed on and younger persons have moved out. Other parts of the country such as Florida are also experiencing an aging of their population due to the migration of older persons during their early retirement years. These retirees tend to migrate to the "sunbelt states" and away from the "rust bowl," following a general migration pattern that is occurring throughout the rest of the country with all age groups.
There is also evidence of a new trend occurring called "counter-migration" in which a small number of older persons who moved away from one state to another at retirement, return home or to a state in which family members live.
In 1984, approximately half of the elderly in this country were living in 8 states: California, New York, Pennsylvania, Texas, Illinois, Ohio and Michigan. All of the eight have one million persons 65 and over. There is a tremendous range of elderly persons within states. Alaska, for instance, had the smallest number of elderly persons in 1984 (13,000), 3.1 percent of its total population.
In 1984, Florida was the state with the largst proportion of residents age 65 and over (17.6 percent).
All states experienced substantial increases in their elderly population from 1970-1980. The largest percent


51
increase in the elderly population over the decade occurred in the south and west. Most states had at least a 50 percent increase in the number of persons 85 and over in the last decade as well, with Arizona and Florida more than doubling the size of their very old populations.
The traditional notion of Florida as the state with the greatest concentration of elderly persons is borne out by these statistics. In fact, the proportion of the 65 and over persons in Florida is now about what it will equal for the rest of the states in the year 2020. Florida is also the nation's "oldest" state with a median age of 34.7 in 1980 as compared to the "youngest" state, Utah, at 24.4.
The three large metro areas in 1980 with the greatest proportion of elderly in the U.S. were all in Florida. Fort Lauderdale, St. Petersburg, each had more than 20 percent. In Miami one is six is elderly. Houston, Texas was the metro area with the smallest percentage of elderly in 1980 with less than 7 percent.
Suburbs
In 1980, for the first time, a greater number of 65 and over persons lived in the suburbs than in the central cities. The growth of the suburban elderly population has touched every major region of the U.S. According to John Logan (1984), the average suburban population in 1980 was 11.8 percent elderly. For the first time, in 1980, a greater number of older persons lived in the suburbs (10.1 million) than in the central cities (8.1 million). Older


52
persons are found disproportionately in suburbs which were established before World War II. These older suburbs also have lower average resident income levels, more rental housing, lower home values, and high population densities.
Mobi1ity
Today's older persons tend to remain where they have spent most of their adult lives. For both adults and children, rates of moving decline with increasing age. Between 1982 and 1983, only 4.9 percent of older persons moved, compared to 34.5 percent of 20-24 year olds and 16.6 percent of persons of all ages.
In recent years, the number of older persons who move has been increasing. Estimates from the Retirement Migration Project, using data from the U.S. Bureau of Census, show a 50 percent increase in the number of older persons who reported migrating from state to state during the 1980s as compared to a decade earlier.
Of the 1,662,520 Americans over the age of 60 who moved out of state during this period, almost half went to Florida, California, Arizona and Texas. Arizona had a 215 percent increase between 1960-1980, Texas, 191 percent, and Florida, 110 percent.
New York is the top contributor of elderly state-to-state movers while California is number two in contributions .
Elderly migration has essentially been a mirror of a national trend where state to state movers are leaving the


53
northeast and midwest and moving into the sunbelt states of the south and west.
Older persons who move from state to state are relatively affluent, well-educated and are frequently accompanied by a spouse.
Countermigration
Some 60 years old and over persons who migrate to the sunbelt in their early retirement years return to their home states or to states outside the sunbelt to be near their children. This trend, called "countermigration," is relatively small in absolute number but is statistically significant. Results of the Retirement Migration Project (1984) demonstrated that Florida lost significant numbers of elderly migrants to states outside the sunbelt namely Michigan, New York, Ohio, and Pennsylvania. For instance, from 1970 to 1980, more than 9,000 residents of Florida moved to New York, which, for 56 percent of them, was the state of their birth. The average age of these countermigrants was 73 years. This was more than double the number of people who moved from Florida to New York the previous decade. Those leaving the sunbelt are most likely to have incomes below the poverty line, and many are disabled or are living in institutions or homes for the aged.


54
3. Economic Status
Older persons in the U.S. tend to have a lower economic status than other adults in our society. This fact is due mainly to the changes in status often associated with aging: retirement from the work force, the death of a spouse, or a decline in wealth. During retirement, the elderly lose earnings and become more dependent upon Social Security benefits supplemented with pensions and the assets they have accumulated over their own lifetimes. With limited potential to improve their incomes through their own work the elderly become economically vulnerable to circumstances over which they have no control: the loss of a spouse, deterioration of their health and self sufficiency, Social Security and Medicare legislation and inflation.
Although over the recent past, the elderly's economic status has improved, when considering cash income there remains a substantial discrepancy between the young and the old. However, many elderly have economic benefits and resources other than cash which enable them to meet their needs in retirement. If all of these additional resources could be converted to a cash value, the economic status of the elderly as a group would be closer to that of the non-elderly.
It must be noted that the economic status of the elderly is far more varied than that of any other age group. While some older persons have substantial resources, a surprising number have virtually none. Comparisons of average statistics conceal the simple fact that an unusually high


55
proportion of the elderly have income and other economic resources below or just barely above the poverty level.
Median Cash Income
Compared strictly on the basis of money income, persons 65 and older, on average, receive substantially less income than those under 65. In 1984, the median income of families with heads age 65 or older was $18,235, 62 percent of the median income of families with heads age 25 to 64 ($29,300). The median income of elderly individuals not living in families was $7,350, about half (47%) that of non-elderly individuals ($15,550).
Poverty Status
Elderly persons are slightly more likely than other adults to be poor. When children are considered, however, the elderly poverty rates are somewhat below poverty rates for the rest of the population. In 1984, 12.4 percent of persons 65 and older had incomes below the poverty level, compared to 11.7 percent of those age 18 to 64, and 14.7 percent of all persons under the age of 65.
The elderly are much more likely than the non-elderly, however, to have low incomes just above the poverty level.
In 1984, 16.7 percent of persons aged 65 and older were in families with incomes between the poverty level and one-and-one half times the poverty level. At the same time, only 9.6 percent of those under age 65 were in families with incomes which fell within this range (see Table 3-7).


56
TABLE 3 -7
PIRCENI_QF_ELpERLY_AND_NgN=ELDERLY_PERSgNS_BY_RAIIQ_DF_INCQME
IQ_PQVERIYjl_1?84
Ratig_of_incgme_to Age
Poverty_Level Under_65 65_and_gver
Below poverty level 14.7 12.4
1007. - - 1247. poverty 4.5 a.8
1257. - - 1507. poverty 5ii 7.9
Total below 150% poverty 24.3 29. 1


57
Age and Income
Persons who are 85 years of age and older have significantly lower money incomes than those who are 65 to 74 or 75 to 84 years of age. In 1983, the median cash income of couples aged 85 and older ($11,988) was substantially less than the median cash income of couples aged 65 to 74 ($17,798) and 75 to 84 ($14,155). The median income for single persons aged 85 and older ($5,912) was also substantially less than for those age 65 to 74 ($7,651) and 75 to 84 ($6,509).
The oldest elderly are also the most likely to have incomes below or just above the poverty level (table, figure if needed).
Strictly on the basis of annual cash income, today's generation of the oldest old have substantially fewer resources than the young elderly. Not only is the median income of persons age 85 and older substantially lower than the median for younger groups, but there is a much greater concentration of the oldest-old in the lowest income ranges.
By looking at the poverty rates provided in Table 3-8 one can see an obvious improvement in the economic status. The poverty rate among those 65 and older was more than cut in half, declining from 28.5 percent in 1966 to 12.4 percent in 1984. During this period, the poverty rate among non-elderly adults actually increased from 10.6 in 1966 to 11.7 in 1984 (see Table 3-8).


TABLE 3-8
58
PQyiBIY_RATES_FgR_N0N-ELpERLY_ANp_ELDERLYJ._1966_-_1984
Age
Year 18 64 65 +
1966 10.6 28.5
1970 9.2 24.5
1975 9.4 15.3
1980 10.3 15.7
1981 11.3 15.3
1982 12.3 14.6
1983 12. 1 14.2
1984 11.7 12.4
Source: U.S. Bureau of Census, Current Population Report, March, 1985.


59
Composition of Income
As a group, the elderly depend more heavily on Social Security for their incomes than they do on any other source. (See Table 3-9). In 1982, 40 percent of all income received by aged units came from Social Security. (An aged unit is either a married couple living together with one or both members 65 or older, or an individual 65 or older who does not live with a spouse.) Nine out of every ten aged units were receiving some income from Social Security, and 15 percent of the aged units received all of their income from Social Security. Obviously, the elderly with the lowest incomes were the most dependent on Social Security benefits. For example, in 1982, 80 percent of aggregate income received by aged units with incomes under $5,000 came from Social Security benefits and only 19 percent of the aggregate income received by aged units with incomes at $20,000 or more came from Social Security.


60
TABLE 3-9
SQURCE_0F_INCDME_AS_A_PERCENTAGE_0F_INCQMEi_l?70_=_19B3
A: Families with a head 65 and older
Year Social Security Asset Income Public Assistance Pensions Earnings
1970 25.0 14.5 1.4 12.5 46.6
1975 32.3 15.6 1.4 14.5 36. 1
1980 32.4 19.4 1. 1 15.6 31.4
1983 34.3 20.9 .8 16.0 28.0
B: Unrelated individuals 65 and older
Year Social Security Asset incgme Public Assistance Pensions Earnings
1970 37.3 24. 1 4. 1 15.4 19. 1
1975 46.9 20.9 3.0 15.7 13.4
1980 47.4 24.4 2.5 14.6 11.2
1983 44.0 28.7 1.9 15.5 9.8
Current Population Reports Series
Source: U.S. Bureau o-f Census, P-60, 1969 1983.


61
Income from assets was the second most important income source for the elderly. In 1982, 25 percent of the income received by aged units was income from assets that the elderly held. In recent years, savings and other asset income have grown in importance as sources of income, increasing from 16 percent of total income in 1962 to 22 percent in 1980. Again, however, this income from financial assets was unevenly distributed and only 25 percent of those who had asset income received more than $5,000 a year from this source.
Earnings from participating in the work force were a very important source of income to the younger elderly, but declines in importance with age. Overall, 18 percent of the income of aged units came from earnings. Those aged 65 to 67 received 35 percent of their income from earnings compared to only 4 percent for those aged 80 and older.
Employee pensions provided 14 percent of the income the elderly received. This share has remained fairly constant in recent years, and is similar for all but the oldest age group. Overall, one in three (35 percent) aged units received income from public and/or private pensions and one in four (23 percent) from private pensions.
There have been a number of obvious trends in the composition of income of the elderly. Most notably, Social Security is becoming an increasingly important part of the income of the elderly, while earnings continue to decline in importance. For example, in the late 1960s, families with heads 65 and older derived nearly half of their income from


62
earnings, while only 23 percent of their income came from Social Security. Now, 15 to 20 years later, Social Security has surpassed earnings as the leading source of income for these families.
A substantial decline in the role of earnings has been the most notable feature of this change. The trend toward earlier retirement among older males has caused labor force participation rates of men 65 and over to drop from 33 percent in 1960 to 16 percent in 1984 (U.S. Department of Labor Bureau of Labor Statistics). As a result, earnings, which accounted for 48 percent of elderly family income in 1963, accounted for only 28 percent by 1983.
Social Security grew in importance as a source of income to the elderly between 1968 and 1974, but has remained fixed since then. The proportion of elderly family income coming from Social Security benefits increased from 23 percent in 1968 to 31 percent in 1974, largely as a result of legislated benefit increases in the late 1960s and early 1970s. Since 1974, however, the proportion of elderly family income coming from Social Security has remained steady. In recent years, a particularly steep decline in the role of earnings has been offset by an increase in the role of assets and pensions as a source of income.
Income Trends
The average economic position of elderly persons has increased in both current and constant dollars in the last
two decades. Between 1960 and 1980 alone the median income


63
of families headed by a person 65 or older increased fourfold. The rate of increase for individuals 65 and over was even greater; their median income rose from 41 percent to 48 percent of younger persons. Nevertheless, in 1980 the median income of older families and individuals alike remained roughly one-half that of their younger counterparts .
In terms of actual purchasing power of this income, older persons likewise experienced somewhat greater gains than younger age groups. While the Consumer Price Index rose by 145 percent between 1960 and 1980, the income of older families rose by 291 percent and for older individuals rose by 342 percent. The greater increase in the median income of the older population vs. the younger population is a result of a number of factors, including automatic annual Social Security cost of living adjustments, and increases in the number of persons receiving private pensions.


64
CONSUMER EXPENDITURES
Elderly households on average consume more of their before-tax income than households in most other age groups. According to the results of a 1981-1982 Bureau of Labor Statistics survey, households in the youngest (under age 25) and oldest (age 65 and over) age groups consume an average of 98 percent of their before tax income. Other age groups consume an average of 71 to 85 percent of their before tax income. The high rate of consumption among the elderly may result from the fact that elderly pay less of their income in taxes than the non-elderly. It may also reflect lower rates of savings among the elderly than the non-elderly. Finally, it may be a result of having reduced income in old age to meet living expenses.
Elderly households also devote more of their consumption to necessities than do younger households.
Eighty percent of the spending by elderly households is for food, housing, transportation and health care. These same items account for only 70-72 percent of the spending of non-elderly households. Health care spending is particularly significant for the elderly, accounting for nearly 10 percent of their expenses, compared to only 5 percent of the expenses of the next youngest age group (see Table 3-10) .


65
TABLE 3-10
AVERAGE_ANNUAL_EXPENDITyRES_gF_CONSyMER_yNIISJl_l?Bl
All Consumer Units 55 64 65 +
NUMBER OF
CONSUMER UNITS COOO'S) 68,295 10,410 13,287
CONSUMER UNIT CHARACTERISTICS
Income before taxes $19,989 $22,312 $10,898
Size of consumer unit 2.7 2.4 1.7
Age o-f householder 46.2 59.3 73.6
Number in consumer unit Earners 1.4 1.4 .4
Vehicles 1.9 2. 1 1.1
Children under 18 .7 .2 .0
Persons 65 & over . 3 . 1 1.4
Percent homeowner 61.0 80.0 70.0
TOTAL EXPENDITURES $17,144 $17,477 $10,754
Food 3,224 3,375 2,215
Housing 5,051 4,687 3,577
Transportati on 3,454 3,575 1,706
Health Care 746 874 1 ,048
Personal insurance &
pensions 1,264 1,460 322
Source: U.S. Department o-f Labor , Bureau of the Labor Statist
Data -from 1980-81 Consumer Expenditure Survey, December, 1984


66
Non-Cash Resources
Although the elderly have substantially lower average cash incomes than the non-elderly, they derive greater economic advantage than the non-elderly from the tax treatment of income, government in-kind transfers, lifetime accumulations of wealth, and family size. Some analysts contend that when these factors are taken into account, the average older person has economic resources roughly equivalent to those of younger persons.
It is probable, however, that while the consideration of non-cash resources reduces some of the economic difference between the elderly and the non-elderly, large numbers of the elderly still have limited economic resources.
Taxes
The elderly as a group pay a smaller portion of their incomes in taxes than do the non-elderly. There are four major provisions in the current tax code that are of special significance to the elderly. These are:
1) The exclusion of veterans pension income and, for those with less than $25,000 (single) or $32,000 (joint) income, the exclusion of Social Security benefits from taxation.
2) The additional exemption for those over the age of 55.
3) The one-time exclusion of capital gains from the sale of a home after age 55 (up to $125,000).


67
4) The elderly tax credit for low income individuals with few or no Social Security benefits.
Also, the tax burden of the elderly tends to be lighter than that of the non-elderly since most elderly no longer pay Social Security taxes (and their income tax payments tend to be based on a lower marginal tax rate).
Approximately 60 percent of the elderly paid no income taxes in 1981 due to low income and/or income largely excluded from taxation. However, those elderly who did pay taxes tended to pay at a higher rate than the non-elderly taxpayers.
In-Kind Benefits
In-kind benefits, especially government benefits, are of particular significance to the elderly since nearly every older person is covered by Medicare hospital and physician insurance. Some analysts contend that the difference in income between the elderly and non-elderly would be reduced if the analysis of income took into account the value of such benefits. The inclusion of these benefits may be misleading, however, because they cannot be used for daily living needs. In addition, it is estimated that one household in time receives at least one in-kind benefit such as food stamps, publicly assisted housing or Medicaid. [Non-elderly workers and their families benefit primarily from employee benefits, such as group health insurance, provided by employers but not counted as income by employees.]


68
The inclusion of the value of these in-kind benefits in the incomes of the elderly causes an upward shift in the income distribution of the elderly, with the largest proportionate increases occurring at low income levels. The net effect of the inclusion of both taxes and in-kind benefits is to reduce the percentage of older persons at the highest and lowest income levels and increase the percentage in the middle of the income distribution.
Assets
The elderly as a group hold substantially more in assets than the non-elderly. Because of this difference, it may be necessary that a comparison of the economic wellbeing of the elderly and non-elderly should include a measurement of the income potential that exists in accumulated wealth.
The fact that the elderly as a group hold more assets than do the non-elderly is a result of normal life-cycle processes. People naturally tend to accumulate savings, home equity, and personal property over a lifetime. It is important to note, however, that although the elderly as a group hold greater assets than the non-elderly, these assets are concentrated among relatively few people. Most elderly individuals hold few or no financial assets. The wealth that they do hold exists primarily in the form of home equity. In 1980, nearly 75 percent of older persons owned their own homes 80 percent of these "free and clear."


69
With all economic resources measured, the elderly are more likely to have limited resources than the non-elderly. Although a lower percentage of the elderly than non-elderly remained at the very lowest economic levels, a substantially higher percentage of the elderly had resources which 'raised them only barely above the lowest economic levels. While only 2.3 percent of the elderly compared to 5.6 percent of the non-elderly had resources which placed them on an income level below 75 percent of the poverty level, 32.5 percent of the elderly (compared to only 27.7 percent of the non-elderly) remained below 200 percent of the poverty level.
By reviewing Table 3-11 it becomes obvious that while the availability of non-cash resources was of greater economic benefit to the elderly than to the non-elderly in 1980, the conversion of these resources to cash income would still not have resulted in a better economic status for the elderly than for the non-elderly.


70
TABLE 3-11
PERCENI_QF_PERSDNS_BY_RELAIIONSHIP_OF_INCOME_IQ_POyERIY_LEyEL
USING_ALIERNAIiyE_DEFINITIDNS_OF_INCOMEA_BY_AGE_GRDlJP_AND_IYPE
QE_INCQMEj._1980
Under 65 65 and Older
Under: cash income . + benefits + weafth cash income . + benefits . + wealth
50 percent 4.8 3. 1 2.9 2.0 1.5 0.9
75 percent 8.7 6.0 5.6 6.2 3.6 2.3
100 percent 12.8 10.3 9. B 15.6 10. 1 6.2
125 percent 17.4 14.8 14. 1 25.7 19.0 12.0
150 percent 21.9 19.4 18.6 34.4 28.5 19.2
200 percent 32.2 28.7 27.7 49. 1 44.4 32.5
Source: ICF, Inc. Data on the Relative Economic Status o-f the Elderly and Non-Elderly in 19S0. (Washington: ICF, Inc. July 1984).


71
Retirement
Since Social Security legislation was passed in 1935, age 65 has been commonly thought of as the "normal" retirement age. Today, however, most retirees leave work before they reach the age of 65. A 1978 national survey of American attitudes toward pensions and retirement found that almost two-thirds of retirees had left work before the age of 65.
Early retirement may be a permanent fixture of the American economy. Even an increase in the eligibility age for full Social Security benefits is likely to have only minimal impact on future retirement ages. According to the National Commission for Employment Policy, research on the impact of the Social Security Amendment of 1983 which sought to delay retirement age suggested that a two-year delay would have a minimal effect on retirement age and would only raise the average retirement age by about three months. The Commission study projected that other options, such as reducing early retirement benefits, would also have little effect on retirement age. According to the results of the study, people retire at a given age for a variety of reasons such as health, availability of private pension benefits, social expectations and long-held plans. Apparently, Social Security benefits are only a small factor in the retirement
decision.


72
Federal Outlays Benefiting the Elderly
Since 1960, the share of the federal budget spent on programs serving the elderly has nearly doubled. In 1960, less than 15 percent of the federal budget was spent on the elderly. In fiscal year 1985, 28 percent of the federal budget will fund programs benefiting the elderly.
The doubling of the budget has occurred in part because of the increasing numbers of older Americans who have received improved Social Security benefits as the system has matured. More significant causes for this increase, however, are legislated improvements in income protection, wealth insurance, and services which were enacted in the late 1960s and early 1970s in an effort to reduce high levels of poverty among the elderly. Today, two-thirds of the budget for the elderly is spent on retirement income as compared to 90 prcent in 1960. Health care spending, in contrast, has become an increasingly significant fiscal burden for both the national treasury and individual senior
citizens.


73
4. Conclusion
The elderly, then, obviously have a great number of unique characteristics which set them apart from the rest of the population. In addition to the rapidly increasing numbers and proportion of the elderly population, it is necessary to highlight some of the other major findings of this study:
* Older women outnumber older men by nearly 50 percent. The differences become particularly great among the 85 and older age group, where there are 2.3 women for every man in the population.
* Because of the imbalanced sex distribution, older women are much more likely to be widowed than are older men.
* With increasing age, it is more likely that a person will live alone.
* Very few elderly actually move. More common is "aging in place."
* Only among the oldest age groups are a substantial proportion of the elderly likely to live in nursing homes.
* Median incomes decrease with each older age group.
* Female headed households have much lower incomes than do male headed households.
* Around 90 percent of the elderly receive some Social Security. Next to that source of income, the most common source is assets interest, dividends, and other benefits.
* Although the poverty rate for the elderly in 1983 was lower than for the population as a whole, it was higher than the rate of other adults.
* Poverty rates increase sharply with age.
The interaction of greater numbers of older people and these other characteristics is producing major economic forces and social changes that require new ideas and


74
responsive action by policy makers. The focus of this research project, however, is on housing for the elderly and therefore the next chapter will deal with the housing situation for the elderly in the United States.


75
Chapter 4
THE ELDERLY AND THEIR HOUSING
The collection of these numbers and statistics has little significance without an understanding of the basic housing circumstances that the elderly must face. To begin with it must be noted that the housing situation of the elderly differs from that of the younger population. To the elderly, the housing and neighborhood environment is of greater importance due to the greater proportion of time the elderly spend at home and in their neighborhoods. Another characteristic of the housing consumption of the elderly is that their housing needs may change very often and quickly. These needs may change as a result of the death of a spouse, physical mobility problems, or a decrease in income or value of assets. Still another characteristic of the elderly is their lower propensity to make major housing adjustments.
The low average mobility rates of the elderly have already been shown and are attributable to strong social ties and sense of place that has built up over a number of years. Therefore, adjustments for elderly householders are often gradual. Instead of moving out of a dwelling that has become too large, they may simply neglect maintenance.
Also, renters may choose to stay in a particular unit even though increases in rent may use up inordinate shares of
their income.


76
There are primarily three aspects of the housing situation of the elderly which will be documented in this section: (1) the absolute numbers of elderly housing units
(2) the physical characteristics of the dwelling units occupied, with emphasis on "deficient" conditions; and (3) the housing expense burden, defined as the percentage of current income spent on housing services. This chapter explores these aspects in considerable detail, providing facts which are essential in discussing potential solutions to the housing conditions and needs of the elderly.
The Current Housing Situation
A prerequisite for discussing the maintenance and improvement of housing for the elderly is to know their current situation. Most of the elements that need to be studied have already been briefly considered, such as size and distribution of the elderly, living arrangements and economic status. Table 4-1 shows in much more detail and in absolute numbers the living arrangements of persons by age and sex.


77
TABLE 4 1
LTV IN 3 ARRANGEMENTS OH PERSONS EY AGE AND SEX, 1980
5IS\ KALE £5+ 63-69 70-74 73-79 80-84 834-
All Hales (000s) 10,263 3881 2860 184 3 1012 668
In Croup Quarters (j) .4.0 1.7 2.6 4.3 7.9 17.0
In Households (jo) 96.1 98.3 97.1 93-7 92.1 83.O
FEMALES
All resales (000s) 13,236 488? 3963 2932 1909 1323
In Croup Quarters (jo) 7.0 1.7 3.1 6.3 13.1 27.7
In Households (%) .93-0 93.3 96.9 93.7 86.9 72.3
TOTAL
All Persons (OOO's^ 23,^93 8768 6822 4793 2921 2193
In Croup Quarters (j>) 5.8 1.7 2.9 5.5 11.3 24.4
In Households (%) 94.2 93.3 97.1 94.3 88.7 75.6
Sources U.S. Bureau of the Census, I98O Census of Population and Housing


78
With increasing age, greater numbers of older people live alone or in group quarters. Also, differences in marital status have a direct impact on the living arrangements of older people. It has already been shown that the elderly have different patterns of living arrangements than do younger adults, but there are also substantial differences within the elderly population. With increasing age, the variety of living arrangements increases. At the age of 65, nearly all persons (90 percent) live in households and only about 1.7 percent of either men or women live in group quarters. (According to Census terminology, a "household" consists of a person or persons occupying a housing unit. "Group quarters" are living situations that are not households, such as nursing homes and boarding rooms.) The proportion of people living in group quarters, however, increases sharply with age. By the age of 75, for example, about 4.3 percent live in group quarters.
Moreover, among those 85 years and older, a very substantial number live in group quarters: 27.7 percent of the women and 17.0 percent of the men.
The major type of group quarters in which the elderly live is homes for the aged, and therefore that category is of primary interest to this study. (Other types of group quarters include mental hospitals, correctional institutions, rooming houses, and others. It is relatively rare for the aged to live in such situations.) Table 4-2 shows that after age 65 for men and age 60 for women, a


79
majority of people in group quarters in each cohort are in such homes for the aged (nursing homes). The percentage of all people in the age group in nursing homes, however, increases sharply with age. Even at age 75 to 79, only 3.5 percent of all men and 5.3 percent of all women are in nursing homes.
The rate of nursing home use by the elderly has almost doubled since the introduction of Medicare and Medicaid in 1966, from 2.5 to 5.0 percent of the 65 and older population .
Nearly 75 percent of nursing home residents are without a spouse, as compared to just over 40 percent of the noninstitutionalized elderly. Such statistics, along with those which show that nursing home residents tend to have health problems which significantly restrict their ability to care for themselves, suggest that the absence of a spouse or other family member who can provide informal support for health and maintenance requirements is the most critical factor in the institutionalization of an older person.
It is important at this point to dispel the stereotype of most elderly eventually ending up in nursing homes. Obviously, this is not the case (see Table 4-2).


80
TABLE if 2
TYPE OF GROUP QUARTERS BY ACZ. IPSO
Nur sing Hog.es of Age Group Mental Hospitals Total in Z Iroup Quarters
Age Number % H-irbcr % of Age Group Numbei % of Age Group
65-6Q 93,320 1.1 13,580 .2 130,040 1.7
70-?if 146,440 2.1 12,160 .2 196,000 2.9
75-79 218,780 4.6 9,300 .2 263,820 5.5
80-34 286,480 9.8 6,960 .2 329,03c 11.3
85^ 487,740 22.2 7,2+0 .3 535,900 24.4
Sources U.S. Bureau of Census, I98O Census of Population and Housing


81
Housing Tenure and Living Arrangements
By reviewing Table 4-3 one can see that of the 17.7 million households headed by older persons in 1980, 72 percent were owner-occupied and 28 percent were rental units. The 1980 Census found that 80 percent of owner-occupied elderly houses were owned free and clear (without a mortgage). In addition, the Census figures indicate that among the elderly, the percentage whose rent increases with age, males are more likely than females to own their own homes, and persons living alone are more likely to rent than are people who live with spouses.
According to the 1983 Annual Housing Survey, over a third (38 percent) of elderly owner-occupied households were inhabited by older men or women living alone or with nonrelatives. Only 33 percent of renter occupied units were maintained by elderly persons in families; the other 67 percent were maintained mostly by elderly men or women living alone. Data from the 1980 Census demonstrates that this pattern is affected by the marital status, sex, and living arrangements of the homeowner. For example, at ages 65-69, 44 percent of men living alone own their own homes, compared to 82 percent of men living with their wives. With increasing age, married couples and single women are less likely to own their own housing.
Persons 65 years or older are most likely to live in older homes whether they rent or own. In 1983, 42 percent of elderly homeowners lived in housing structures built in


82
1939 or earlier and another 14 percent lived in structures built between 1940 and 1949. By contrast, only 17 percent of younger homeowners lived in units built before 1939 and another 9 percent lived in units built between 1940 and 1949. Younger renters were similar to elderly renters: namely 40 percent of both age groups lived in structures built in 1939 or earlier (see Table 4-3).


83
TABIE 4-3
DISTRIBUTION OF ELDERLY HOUSEHOLDS BY TENURS AND OF HOUSEHOLD TYPE BY AGE.1980
Tenure
Homeowners Renters (£)
80
20
Are of Head 65-74 75 and over
73
27
69
31
Household Type by Tenure
Homeowners Families Living Alone male (f0) female (7$)
Renters
Families (%')
Living Alone male (?$) female (%)
83 67 52
4 6 11
12 27 37
32 37 30
17 16 14
30 47 56
Source: U.S.
Bureau of the Census, I9S0 Census of Population and Housing


84
Housing Costs
Housing costs vary a great deal depending on home ownership status. For all males aged 65-69, housing costs are 22 percent of income for renters, 21 percent for owners with a mortgage, but only 11 percent for owners without a mortgage.
In general, housing costs include gross rent or mortgage payment, basic utility costs, real estate taxes and insurance for owners.
This trend becomes stronger with increasing age. For males aged 85 and older, housing expenses for renters and owners with a mortgage equal 26 and 33 percent of their incomes respectively, as compared to only 15 percent for owners without a mortgage. These comparisons are proportionally similar for elderly females.
In general, lower income households, female headed households, and households with older heads spend relatively high shares of their income for housing.
Housing, then, represents an asset for most older people but is a serious problem for others. For older homeowners who do not have to budget for mortgage or rental payments, or who can sell their homes at a profit, housing can be an asset. However, to many elderly persons who own older homes, the cost of repair and maintenance can be prohibitive. In addition, for renters or owners with a mortgage, monthly housing payments can be a substantial
burden.


85
General Housing Characteristics
This portion of this chapter is an attempt to analyze the physical characteristics of the dwelling units occupied with an emphasis on "deficient" conditions. The data shown in Table 4-5 provide for a broad description of the housing of the households headed by an individual 65 years or older compared with households headed by younger persons. In addition, homeowners are distinguished from renters. The table provides information on tenure and on some selected characteristics of the dwelling units occupied.
It can be seen that both elderly homeowners and renters tend to live longer in their units than do the non-elderly. The most noticeable difference is seen for the owners: while 81 percent of younger households have lived in their home for fifteen years or less, only 30 percent of the elderly are such short-term residents.
Persons 65 years or older are most likely to live in older homes whether they rent or own. In 1983, 40 percent of elderly homeowners lived in housing structures buiilt in 1939 or earlier and another 14 percent lived in structures built between 1940 and 1949. By contrast, only 17 percent of younger homeowners lived in units built before 1939 and another 9 percent lived in units built between 1940 and 1949. Younger renters were similar to elderly renters: nearly 40 percent of both age groups lived in structures
built in 1939 or earlier.


86
While the age of housing is not ncessarily an index of physical condition, it does have a relationship to size, functional obsolescence, and ease of maintenance. Various housing studies have revealed that many older persons live in homes that are too large for their current family size and/or need. In addition, many elderly with physical handicaps do not have the funds or the services available to adapt older and larger homes to their physical needs.
In terms of physical attributes, there is a consistent pattern of the elderly living in smaller units than younger households. Among owner-occupants, the units occupied by the elderly have central heat less often, are smaller as measured by the count of rooms and bathrooms, have a lower incidence of air conditioning, are less well insulated, and are older.
Among renters, the elderly tend to live in much smaller apartments than do younger renters. Also, the elderly's units are more likely to be in older structures and in less well-maintained structures (see Table 4-5).


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TABLE 4 5
FEP.CENTI IE DISTRIBUTION Or GEN ERAL CKAI .ACTERICTTCS OF UNITS OCCUPIED E'
ELIli.LY AND NON-ELDERLY. EY TE; KUnE. 19: \
Owner- -occupants Rente rs
Elderly Nori-elderly Elderly Non-els
1. Year Moved into Dwelling Unit
Since 1982 5 10 29 47
1970 1932 40 51 48 45
1965 1970 15 11 12
I960 I96L 10 10 5 2
I955 1959 10 9 3 2
Before 1955 20 7 2 1
2. Number of Boons
1-2 18 9
3-4 21 8 65 56
5 6 60 56 16 30
7 or more 19 36 1 4
3. Number of Complete Bathrooms
1 63 43 86 82
More than 1 34 56 7 14
None 4. Type of Heating 3 1 7 4
Central Heat 81 92 80 83
Room Heaters 16 6 16 13
Fireplace, stove 2 2 3 2
5. Main Water Source
Public or Private System 86 85 96 93
Well 13 14 4 5
6. Unit Has Full Kitchen 99 100 96 98
7. Unit Has Air Conditioning 50 60 41 46
8. Insulation
Ceiling is insulated 71 85 7 14
All Windows Storm 49 51 4 9
9. Year Structure Built
Since 1970 12 26 18 24
1965 1970 10 13 11 12
I960 1964 8 13 8 10
1950 1959 16 22 11 9
I9/4.9 -19/49 14 0 s 10 9
Before 1940 40 17 42 34
Source: Unpublished tabulations from the Annual Housing Survey, 1983


88
Dwelling Quality
Dwelling quality is an important factor in determining the housing situation for the elderly. There are three general factors that have often been used in determining housing conditions: (1) incomplete plumbing, that is, not having available hot and cold water, a tub or shower and a toilet for the exclusive of the household; (2) overcrowding, generally defined as more than one person per room; and (3) dilapidated condition of the structure. The U.S. Census Bureau defines a dilapidated unit as one that does not provide safe and adequate shelter and in its present condition endangers the health safety and welfare of the occupants. Neighborhood attributes are also associated with dwelling quality. These attributes might include such things as the condition of neighbors' dwellings, and the public services provided in the area.
Around 1950, when data on such subjects was first obtained, there was a high incidence of these problems, but since that point there has been a large decrease in their incidence. There has still not been developed, however, an accurate way to measure dwelling quality. Therefore, a large number of indicators must be put together to analyze the housing situation of any one group.
The data that has been presented so far has given a broad description of the housing situation of the elderly.
It is necessary, however, to know how many elderly fall below some standard of minimally acceptable housing. To