Low-Income Retirement Housing: What to Know

For seniors with limited fixed income, housing costs can easily consume most of the budget, which has resulted in a demand for low-income retirement housing. As the cost of living rises and more people enter retirement, affordable housing can be difficult to secure. Nonprofit organizations, coalitions, and government programs can help retirees afford housing expenses.

Low-Income Retirement Housing Options

The cost of housing and the associated care can vary widely. According to a 2024 Genworth Cost of Care Survey, it can range from about $769 to $13,233 a month depending on the state and type of facility. Seniors with limited financial means have other options which include:

• Aging in place: Living independently is often cheaper than living in senior-specific housing. More than half of seniors living alone don’t have the money to cover necessities. The University of Massachusetts Boston’s Elder Index can help determine how much money individuals need to live independently and age in place.
• Living with family: Staying with adult children or other relatives is a common housing situation for retirees in the U.S. Multigenerational housing is one method seniors can use to avoid poverty and avoid becoming unhoused.
• Subsidized housing and Section 8: The U.S. federal government provides rental and single-family home opportunities for individuals with very low incomes. 
• Assisted living facilities: Assisted living facilities cater to more specific healthcare needs. The amenities and services provided depend on the level of care needed. 

What to Consider

Affordable housing for income-restricted seniors can be difficult because the waitlists often span several years. Getting an early start with securing housing means a better chance at accommodating a retiree’s budget and fulfilling their community needs, Jennifer Prell, CEO and founder of Elderwerks, told Investopedia.

Retirees can be the targets of scams. Find community-based agencies, nonprofits, and websites without corporate deals. Individuals can also turn to the U.S. Department of Housing and Urban Development (HUD) for more guidance and information about where to look for income-restricted housing for seniors. Some things to consider when looking for income-restricted homes include:

• Location: The location of housing can affect tax rates, healthcare options, climate, access to public transportation, and job opportunities.
• Future needs: Health conditions, family relationships, and other factors can change. Consider whether the housing has the amenities and conveniences required now and in the future.
• Issues and complaints: Check online for reviews and comments on specific housing complexes. Medicare has nursing home rating systems that can help determine the right nursing home for each individual.
• Type of housing: Various types of senior housing may focus on age, lifestyle, and level of care. Understanding what a retiree can afford and the requirements of each community will help them better understand whether independent living, active adult communities, respite care, or another housing option is the right option.

5 Ways to Pay for Senior Housing

When retirees search for affordable or income-restricted housing, they each have different needs that require different costs. “We ask questions to understand who they are as a person, make sure their legal affairs are in order, and what their financial picture looks like,” Prell said. “Many of them are coming to us with no savings, no assets, and no idea of how they will afford to live.”

It’s estimated that more than 17 million seniors ages 65 and older are economically insecure, meaning they have incomes below 200% of the poverty level. According to one study by the National Council on Aging, 80% of older Americans ages 60 and older could not afford to pay for long-term care or withstand a financial shock.

• Social Security: Social Security is a common and reliable income source for retirees with monthly payments. Social Security represents almost 90% of income for 12% of men and 15% of women.
• Medicaid: Retirees may receive housing assistance through Medicaid for some facilities. Benefits vary by state.  
• Nonprofit organizations: These organizations help fill financial gaps related to housing. Elderwerks, Volunteers of America, and HumanGood are some examples.
• U.S. Department of Veterans Affairs (VA): Veterans may be eligible for housing benefits including financial assistance for nursing homes, assisted living facilities, and home healthcare through the VA. 
• Long-term care insurance: Offered by various insurance agencies, long-term care insurance covers personal care needs like nursing homes or adult daycares. It may be a viable option for those unqualified for Medicare or Medicaid.

The Bottom Line

Finding low-income housing for retirement can be challenging. The more older adults prepare for retirement, the easier it is to meet their housing needs. A financial advisor can help guide individuals through their best options for housing and other retirement topics.