I've been thinking about the following since I returned from Phoenix. Arizona seems to have senior citizen care down. Lots and lots of independent living places, assisted living places, and senior group homes. Which got me thinking: hasn't the explosive growth in senior housing been largely fueled by the rise in home equity? That's how most seniors are paying for their care-based living arrangements, yes? From the (huge) profit they make when they sell the family home? For example, Belmont in Burbank charges (I think) a minimum of $5,000 a month. A care facility can easily cost much more. So, what happens to our seniors and their living arrangements when home equity takes a dive and they no longer have the ability to pay? I think we are going to see many changes in the senior housing industry, and they won't be good.
This is a VERY good point, especially with the massive number of baby boomers who will soon be tiptoeing into their twilight years.
ReplyDeleteThere are many industries built on the illusion of home equity that will be facing reality. People thinking on retiring on their home equity instead of planning for retirement will understand just exactly why they were wrong very soon.
ReplyDeleteSaving and investing always beats out spending and believing you are at a higher income strata than you really are. People don't get immediate feedback that what they are doing is wrong so they continue to do it. It is only in the "Pay later" years that they understand what "Buying now" really cost them.