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Demand for housing
May 14, 2018
Not enough senior housing to meet demands
The baby boomers are now joining young Canadians and others frustrated by sky-high rents and soaring costs.
The rating agency DBRS Ltd. Reports that an affordability crisis is looming as the baby boomers will squeeze the supply of retirement homes and push up rents.
The average rents for senior’s homes varied across the country in 2017. Ontario was the highest at $3,526 per month and Quebec the lowest at $1,678 per month. If rents continue to increase by 4.7 per cent a year, the national average could be over $4000 a month by 2025. There will be 2.4 million Canadians aged 65 and older who require “supportive care” offered by retirement homes by 2026.
More senior housing units are being developed every year, but not enough to meet the demand.
Laura Tamblyn Watts, national director of law policy and research at CARP said “It’s not like we didn’t know the baby boomer bulge was coming, we just didn’t do anything about it”. “There has been a failure across the entire system to prepare”.
With rent levels differing across the country so do provincial policies and depending on where you live senior’s may or may not be able to absorb them.
British Columbia and Alberta offer subsidies for retirement home costs but Ontario depends entirely on private payments.
Tamblyn Watts added that a shortage of long-term care beds has exacerbated demand for retirement homes.
Carp Survey: Feedback on seniors' issues
Based on a CARP questionnaire pertaining to seniors’ issues:
The Ontario Liberals said they would add 5000 new long term care beds by 2022 and more than 30,000 over the next decade.
NDP leader Andrea Horvath promised to launch a full public inquiry into long-term care within 100 days of being elected.
The Progressive Conservatives have pledged to build an unspecified number of long- term care facilities.
Isobel Mackenzie , seniors’ advocate for the B.C. government said boosting funding for long-term care addresses only part of the problem. “From the perspective of the taxpayer , it makes more sense to subsidize home care and assisted living”.
The boom in the housing markets has given seniors a rare cushion, pushing the median net worth of families led by Canadians 55-64 to $669,500 in 2016, up 18.9 per cent since 2012., according to Statistics Canada, Mackenzie noted..
Mackenzie also states that the value of houses doubled or tripled in Toronto and Vancouver and cost of assisted living hasn’t increased by as much but this won’t last forever and you have to remember that a house doesn’t produce any income as an asset. So the bigger challenge is how to produce the income seniors need without private pension funds.
Adapted from Naomi Powell, Financial Post