Soaring rent costs put seniors in limbo
Report says prices are highest at Toronto retirement homes, warns of ‘very low or even no new supply’
Before Patti Elizabeth’s aunt passed away, she was paying $5,200 a month for five years to live in a single room with a shared kitchenette in her retirement home in Whitby.
Elizabeth, 58, fears she’ll never be able to afford to pay that much for a retirement home.
She says her generation, the baby boomers, are lucky because some of them have pensions. But she worries their kids won’t. Her children won’t be able to afford to pay for her to be in a home, either.
“They don’t have the jobs; they don’t have that kind of money. I couldn’t possibly pay that, $5,000 is just an incredible amount of money,” she said. “Who has that?”
That’s why she finally decided to welcome another of her elderly aunts into her home. She’ll soon move in.
“I think that we need to be able to do that for everyone,” she said. “It just makes me crazy.”
As housing prices across Greater Toronto rise and supply falls, the same is true for retirement residences, forcing seniors to deplete their savings, move in with family or move out of the city toward relative affordability.
These homes — the all-inclusive kind you pay for, not the long-term care buildings you wait for if you’re extremely ill — can afford to name their price in a hot market.
This year, vacancy rates in Ontario retirement homes reached their lowest point since 2001, dipping to10.4 per cent, according to the Canada Mortgage and Housing Corp.’s latest seniors’ housing report.
Although the total supply of senior housing grew by 2.4 per cent to more than 57,000 spaces in 2017, Ontario’s 75-plus demographic grew by 2.9 per cent. That growth is expected to more than double to 6 per cent by 2022.
“Demand is increasing at a faster rate and that’s why we saw the vacancy rates drop in 2017,” said CMHC’s principal market analyst, Jean-Sébastien Michel.
The report warns that in Toronto, where prices are highest, seniors have “very low or even no new supply in the pipeline.”
And new units are now seldom offered at lower prices. In 2014, 9.3 per cent of all units in the GTA were for rent for less than $2,500 monthly. Today, only 5.7 per cent of all spaces are available in that price range.
Michel says new retirement residences are increasingly building two-bedroom units so that they can charge more, making it harder to find smaller spaces.
“(It’s) going to be a challenge . . . to get enough supply into the market,” he added.
“In the next five years, you will see a large increase in the number of 75-plus people seeking spaces.”
In the GTA, the majority (54.1 per cent) of all rental spaces for seniors now cost more than $4,000. The average monthly rent for a standard senior living space in the GTA has risen to $4,159 in 2017, up from $3,825 in 2014.
In Toronto, Etobicoke and Scarborough, a one-bedroom unit runs an average monthly rent of $4,746.
Deb Hallet, who lives in Oshawa, says her 91-year-old father, Syd, was repeatedly sent home from the hospital while battling Alzheimer’s after he’d broken his hip when he couldn’t afford a retirement home in Scarborough — where her sisters lived — on two pensions.
“The cost was ridiculous,” Hallet said, adding that the options for home care were no less expensive.
As a result, regions such as Niagara, Windsor and Kingston have become destinations for Toronto’s elderly, according to Michel.
“Toronto actually has a fairly low capture rate in terms of the proportion of the 75-plus population that’s in a seniors home,” he said, because the elderly either go outside the city for retirement homes or stay longer with family to avoid the costs.
These decisions are usually made as a last resort, when seniors can no longer hang onto their independence or lose mobility, Michel says.
“People like to age in place. They like their home, they like their family being able to come visit them,” he added.
There are some options for seniors, though they’ve become increasingly limited.
Pat Irwin started ElderCareCanada to help advise the children of seniors on the various paths forward after her father felt abandoned with no choice in his residence in the late 1990s. “I literally put my hand on his grave and said nobody else is going through this where you just don’t know what your options are,” she said.
Long-term care in nursing homes is subsidized by the province, but Irwin says conditions are getting worse and waiting lists are growing and accept only the severely ill.
But long-term homes can be the only options for in-limbo low-income seniors who don’t want to move too far from home, Irwin said.
Seniors can no longer say no to acceptance into a residence either, which prohibits them from cluttering up lists.
With nowhere to turn, many are forced to downsize from homes to apartments to hire round-the-clock care at up to $600 a day, said Irwin, who says less expensive bare-bones residences are “few and far between.”
Maxime Camerlain, Chartwell’s vice-president of real estate integration, says retirement residences must do more than build more units to bring prices down if they want to accommodate a baby boomer generation he thinks will redefine old age in other types of homes if they don’t.
“We’ve long realized that if we didn’t talk to them, they would turn around and build it themselves,” he said.
He says residences in Quebec have already successfully done that by offering more choice and low baseline prices with the opportunity to buy into other features, rather than the all-inclusive resort style often used in Ontario.
While good food and central locations are still major factors, Camerlain says, affordability and choice are becoming more important to seniors.
He promises that Chartwell’s new “Sumach” retirement residence, which is expected to be completed in the Regent Park area by 2018, will offer some apartments in the low $2,000s.
As life expectancy rises, baby boomers must now prepare to live to 100 instead of 85.
“You always say you’re going to save your money for a rainy day and I say ‘Well it’s raining and is your nest egg enough?’ ” Irwin said.