5 ms·

Perhaps the housing market is obese from low interest rates, and will be healthier after a bit of dieting. Society would be healthier if the housing market was

by cwkoss 4y ago

Perhaps the housing market is obese from low interest rates, and will be healthier after a bit of dieting. Society would be healthier if the housing market wasn't managed to be a retirement fund. Would likely end homelessness.

lotsofpulp 4y ago
I keep reading this house as a retirement fund comment online, and I have no idea what it means. Are reverse mortgages a common part of people’s retirement? https://www.urban.org/urban-wire/reverse-mortgage-use-differs-race-and-ethnicity-heres-why-it-matters https://www.urban.org/urban-wire/reverse-mortgage-use-differ... > At a time when seniors are sitting on a mountain of housing wealth and have anxiety about their finances, this should be a well-used program. Instead, despite rising senior population, participation decreased between 2011 and 2018, from 73,112 to 33,000 mortgages. Does not seem like a popular part of peoples’ retirement plans. Even downsizing a house does not seem like it would yield enough of a profit to be a major component of retirement, unless you go from super popular area to middle of nowhere. But I doubt that is people’s retirement plan either. https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS
- cwkoss 4y ago
  Many middle class seniors sell their homes to pay medical or long term care expenses.
  - lotsofpulp 4y ago
    I would like to see stats on that because the Medicaid asset test excludes $636k of one’s home value. https://www.medicaidlongtermcare.org/basics/home-ownership-impact-eligibility/ https://www.medicaidlongtermcare.org/basics/home-ownership-i... There should be no need to sell a home for almost everyone to receive healthcare or long term care (which would be covered by Medicaid/Medicare). And if people wanted to move to higher end facilities, those cost $10k+ per month, so selling a median house to live in one does not buy you much.
    - hotdogrelish 4y ago
      Interestingly in some states it's even higher than $636k! However, I think you're on the nose with the long term care facilities. Medicaid will only pay 100% of any nursing home care (high end or low end) if your countable assets are $2500 or less. Additionally, Medicaid considers your income going back 5 years in order to determine eligibility, so selling (or putting into a trust) sooner rather than later can make sense for a lot of people. https://www.webmd.com/health-insurance/features/when-how-much-medicaid-pay-nursing-home-care https://www.webmd.com/health-insurance/features/when-how-muc...

by cwkoss 4y ago

lotsofpulp 4y ago

I keep reading this house as a retirement fund comment online, and I have no idea what it means. Are reverse mortgages a common part of people’s retirement? https://www.urban.org/urban-wire/reverse-mortgage-use-differs-race-and-ethnicity-heres-why-it-matters https://www.urban.org/urban-wire/reverse-mortgage-use-differ... > At a time when seniors are sitting on a mountain of housing wealth and have anxiety about their finances, this should be a well-used program. Instead, despite rising senior population, participation decreased between 2011 and 2018, from 73,112 to 33,000 mortgages. Does not seem like a popular part of peoples’ retirement plans. Even downsizing a house does not seem like it would yield enough of a profit to be a major component of retirement, unless you go from super popular area to middle of nowhere. But I doubt that is people’s retirement plan either. https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS

cwkoss 4y ago
Many middle class seniors sell their homes to pay medical or long term care expenses.
- lotsofpulp 4y ago
  I would like to see stats on that because the Medicaid asset test excludes $636k of one’s home value. https://www.medicaidlongtermcare.org/basics/home-ownership-impact-eligibility/ https://www.medicaidlongtermcare.org/basics/home-ownership-i... There should be no need to sell a home for almost everyone to receive healthcare or long term care (which would be covered by Medicaid/Medicare). And if people wanted to move to higher end facilities, those cost $10k+ per month, so selling a median house to live in one does not buy you much.
  - hotdogrelish 4y ago
    Interestingly in some states it's even higher than $636k! However, I think you're on the nose with the long term care facilities. Medicaid will only pay 100% of any nursing home care (high end or low end) if your countable assets are $2500 or less. Additionally, Medicaid considers your income going back 5 years in order to determine eligibility, so selling (or putting into a trust) sooner rather than later can make sense for a lot of people. https://www.webmd.com/health-insurance/features/when-how-much-medicaid-pay-nursing-home-care https://www.webmd.com/health-insurance/features/when-how-muc...