Tuesday, May 24, 2011

Can I Rent The American Dream?

Authored by Kate Birnbryer White, Executive Director, Elder Law of Michigan

An interesting by-product of the housing crisis is the movement away from home ownership as a goal for families and those who aspire to the American DreamEven celebrities are moving toward rentals in the current challenging housing market.

While renting might be a good idea for some people who need the flexibility to move to follow employment or can’t yet afford to own a home, the glut of housing on the market is hurting families in the third act of the American Dream….retirement.  In my view, at least here in the Mid-west, the first act of the American Dream is buying your first home; the second act is the home where you raise your kids; the third act is where you live in retirement.
There are pros and cons to renting and a lot depends on your personal situation. Renting property can make a lot of sense for retirees.  Giving up some of the responsibilities and costs to maintain a home is often a good solution for people who want to live in a multi-generational single family home in a neighborhood. But for retirees who are living in a home that they can’t sell, or is not worth much because of the foreclosures on the market, they are victimized again by the recession which has gutted their savings and investments for retirement.
At the same time older adults and the working poor need to make important decisions about where to live and how to pay for it, Congress has cut funding for the HUD Housing Counseling Assistance Program in fiscal year 2012 federal budget.  Hopefully Congress will think better of it and find a way to restore this vital program that protects property values and communities before they finalize the 2012 federal budget.   

We desperately need more creative solutions on how to provide affordable housing options for people aspiring to the American Dream, and not reduce funding for the information and infrastructure that could fuel new ideas to solve a problem that is not going away.  Maybe my next job will be as a non-profit rental agent helping middle-class retirees rent out their homes so that they can afford to move into assisted living, apartments or homes that can be modified to support their desire to age in place.  But that leads me back to my original question…can you rent the American Dream—in retirement?  I am not sure.  At this point, I am hoping that the older adults I know who can’t sell their homes at least have the chance to break even and aren’t forced to take a short sale on their retirement.

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