With rising health care costs and the Great Recession still very much intact, the need for affordable senior housing is on a steep up rise.
Multiple countries within the United Kingdom, as well as Japan, Korea, Australia, and Brazil are faced with high retiree to worker ratios and those numbers are anticipated to keep rising astronomically. In the United States, children of the baby boomer generation are beginning to see the same issues developing. As a result, Americans are finding it increasingly difficult to secure affordable living accommodations that ensure proper care and safekeeping for their elderly family members.
According to the AARP,
“Although the number of older adults in the United States continues to grow, the absolute number of certified nursing home residents has slowly but steadily declined since 2000…”
Nursing homes do offer sustainability, skilled care, and around-the-clock supervision for our loved ones. But, who besides the rich can afford them? You might as well forget about having anything left over out of any savings or retirement accounts, because Medicare will not cover anything until after our loved ones exhaust all of their own financial resources – even then Medicare is limited as to what it will cover. Furthermore, it can be extremely disheartening, not only for us, but for our loved ones as well, to lose that sense of autonomy and be far away from family.
To combat this problem, a new trend has developed overseas and is becoming increasingly popular here in the United States as well. “Transitional homes,” also referred to as “Granny Pods,” are being manufactured to offer families an alternative to placing their loved ones into a senior care facility. Newly established housing manufacturers across the country are producing these micro-apartments, assisted-dwelling units, or “Granny Pods” that can be constructed and added to an existing property, usually in the back yard. These micro-homes are designed and equipped specifically for the elderly to avoid immediately entering into a facility or moving into an adult child’s home. This offers seniors the ability to maintain their independence while still remaining close to their family.
There are some who believe Granny Pods to be too costly for the average person, and thus not an affordable alternative to a senior living facility or nursing home; however, if you take a look at the cost of both, you may decide otherwise.
The purchase price of Granny Pods typically ranges on average between $40,000 and $125,000. Some manufacturers also offer the option to sell it back upon completion of use, depending on the type of unit and on the mobility of the home. One company located here in the Tampa Bay area, Home Care Suites, offers assisted dwelling units for purchase starting at $42,880.00. They also offer financing which starts around $800 per month ($9,600/yr.). To some that may seem like a small fortune to fork over for a small dwelling unit. However it may be noteworthy to compare the benefit of having your family member at arm’s length, in a home that offers independence with ready equipped ADA compliant features specifically designed for their personal needs, versus putting them into a hospital-like environment away from their family.
An assisted-living one-bedroom apartment costs on average about $35,000 annually whereas semi-private nursing averages approximately $79,000 per year, and a private nursing home costs about $85,000 per year. Unlike the granny pod, these options are recurring annual costs that may otherwise deplete all the savings our loved ones have worked for their entire lives. The chart below further illustrates the difference in price between the choices.
Granny Pods may take off a little slower here in the United States, as we are not as accustomed as other countries are in taking care of our elderly under our own roofs. However, this may change very soon given the economy and the lack of affordable senior housing. Perhaps somewhere in the not so distant future local and/or federal government programs may find a way to subsidize this type of housing with either tax incentives, government-backed funds or both. It could prove to be a pleasant alternative to placing the elderly into nursing homes or assisted living facilities by keeping our loved ones at home while placing less of a burden on their adult children.