Retirement rental: divorce, financial shocks and illness revealed in new research

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According to the 2018 census, around one in five Auckland residents aged 65 or over are currently renters.

Divorce, unexpected financial shocks, illness and sky-high house prices are leaving more and more older Kiwis renting in retirement, with new research highlighting the challenges they face.

This includes combating discrimination in the rental market, living in housing ill-suited to their particular needs, and increased stress that can accelerate their decline to illness, the researchers said.

The results are contained in a new research paper looking at 66 older Kiwis who now rent but previously owned their own homes.

Here are snapshots of the reasons they lost their home:

“We sold (the house) to put money in the store, then we went bankrupt. The worst thing I did was sell the house” – Dougal, 68.

“I invested money in (a finance company) Bluechip Investments, I lost the house in the collapse… we were persuaded to invest by friends” – Keith, 81.

“My marriage ended. I was unemployed and there was nowhere I could really afford” – Hoani, 56.

Housing researcher Kay Saville-Smith edited the article – which was one of 10 published today in a special issue of New Zealand Population Review on the housing crisis – said these Kiwis more older people were now probably facing increased difficulties.

“Mortgage-free home ownership has always been a very critical factor in the well-being of older people later in life,” she said.

Yet they are not the only ones to see homeownership rates plummet among older Kiwis.

About one in five Kiwis over the age of 65 is now a tenant, a larger proportion living in the regions.

According to the 2013 census, one in three people aged 75 and over in Ruapehu were renters – the district with the highest percentage of older renters in the country.

According to the 2018 census, around one in five Auckland residents aged 65 or over are currently renters.
According to the 2018 census, around one in five Auckland residents aged 65 or over are currently renters.

A recent study of people facing “severe housing deprivation” – meaning they were either homeless, or living in temporary or overcrowded homes – also found that one of the fastest growing groups quick was the older Kiwis, said Saville-Smith.

“That small group of people who no longer own their homes in their old age, it’s probably the ones who end up technically homeless at some point, often surfing the couch, but sometimes also literally in emergency housing, ”she said.

Other stories from the NZ Population Review newspaper include that of Marigold, 86.

She and her husband loaned their son money which was never paid back.

This forced them to sell their house to manage the debt and move in with another family member. Stress eventually led to Marigold’s marriage breakdown.

Rita, a 65-year-old woman, recounted how she sold her Auckland home to buy it in Dunedin.

However, feeling “very isolated”, she sold to Dunedin to be closer to her family.

a roof

But, having lost money on the sale, she then lost her job in her 50s – a setback from which she was never able to recover and become the owner again.

Saville-Smith said these older Kiwis had to face a series of battles to get back on their feet.

Thirty years ago, landlords may have preferred older tenants over those likely to take care of their rentals, she said.

But these days, younger renters tend to be preferred due to the perception that their growing incomes could keep pace with regular rent increases.

Stephanie Clare, chief executive of the Age Concern charity, said her team has even heard more and more stories of older renters lining up for rental visits alongside long queues of students.

Saville-Smith said older Kiwis who owned their homes, after paying off their mortgages, tended to have safe and secure housing, the running costs of which were lower than those faced by tenants.

It also gave homeowners an asset they could use to fund health care costs or a move to a retirement village.

Older couples face a series of challenges when forced to rent during retirement, researchers say.  Photo / 123rf
Older couples face a series of challenges when forced to rent during retirement, researchers say. Photo / 123rf

In contrast, rental units tended to tend to be in “worse shape” than owner-occupied units and lacked ramps or other safety measures suitable for older people.

There was also a shortage of state houses suitable for the aged, Saville-Smith said.

With more Kiwis expected to rent in their old age in the future, Saville-Smith and the authors of the research paper said more work needs to be done to provide a suitable rental housing supply for older Kiwis.

More work on prevention is also needed.

This could include better education on the risks of lending to family or friends, or using family home equity to fund a business, Saville-Smith said.

She said it was necessary because the toll could be greater for those who lost their homes later in life.

“When people become homeless or their housing is very poor, they often become very sick,” she said.

“This is true for everyone, but for the elderly it can be a real shock to their physical and mental health.”

“Some of them will end up so badly that they will end up in residential care early.”


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