The “Forgotten Middle”: Housing America’s Middle-Income Seniors and Solo Agers

An undersupplied market meets shrinking family caregiving and rising costs—leaving taxpayers on the hook.

The silver tsunami has a middle swell. By the end of this decade some 14m Americans will enter the ranks of “middle-income” seniors: too well-off for Medicaid, too poor to afford most private-pay housing. By 2033 that figure will climb to 16m. By 2033 that figure will climb to 16m; 72% will be unable to afford assisted living if home equity is excluded, and even counting it, 39% still fall short. For developers and policymakers alike, this is less a niche than a looming crisis.

The Solo Ager

Consider Mary, 74, a retired teacher in Denver. Widowed and childless, she sold her four-bedroom home after a fall on the stairs made living alone untenable. Assisted living was out of reach—nearly $7,000 a month in her market. Instead she moved into an active-adult rental: a two-bedroom flat with a gym downstairs and neighbors her own age. She buys meals à la carte, joins the walking club, and pays $2,400 a month—still high, but predictable. “I don’t need a nurse,” she says. “I just don’t want to be alone.” Joan is not rare; she is the future consumer these communities are being built for.

Arithmetic of decline

The numbers do not flatter. The median cost of assisted living reached $5,900 a month in 2024, a jump of 10% in a single year. Nursing-home rates rose by as much as 9%. Labor and insurance costs climb steadily while retirees’ incomes do not. The mismatch is brutal.

Meanwhile demand surges. Occupancy in senior housing across major markets touched 87% in early 2025, its highest since the pandemic. Active-adult rentals—apartment communities heavy on amenities, light on services—are running at near 93%. With construction pipelines thin, scarcity is pushing prices ever higher. Those who can hold costs down fill their buildings; those who cannot are out of reach for the middle cohort.

Grey dividends, grey risks

The “forgotten middle” is not just a social concern but a market fault line. Labor shortages in elder care are already pushing up wages, feeding into broader service-sector inflation and stretching state Medicaid budgets. Investors—ranging from REITs to private equity funds—are beginning to treat senior housing as “grey infrastructure,” a defensive but politically fraught asset class whose returns depend on public policy as much as occupancy rates. Insurers, too, are re-pricing long-term-care coverage, anticipating faster spend-downs among middle-income seniors. If this cohort falls through the cracks, Medicaid will absorb the bill, swelling public liabilities. Add to this the knock-on effects of older renters competing for scarce housing, pension savings eroded by care costs, and a fiscal squeeze that leaves governments juggling ageing-related outlays with everything else—the result is less a niche dilemma than a systemic economic risk.

The rise of the solo ager

Demographics sharpen the dilemma. Roughly 28% of Americans over 65 live alone, including a third of older women. Nearly one in six adults over 55 has no children. As the pool of family caregivers shrinks, more people must buy what they once got for free: companionship, support and emergency help. Housing, in other words, must double as community and safety net.

Three models emerge

The first is unbundling. Operators strip out services such as meals and transport, offering them on demand. Costs are trimmed by reusing older buildings, simplifying kitchens and cross-training staff. Prices fall to 40–60% of traditional assisted-living levels. Spartan this is not; disciplined it is.

The second is active-adult rental housing. Targeted at the “independent-but-not-isolated” 70-something, these apartments offer social programming, gyms and tidy landscaping, but not nurses. They appeal to solo agers who want neighbors rather than carers. They also dovetail with another trend: renting. Between 2013 and 2023 America added 2.4m renters aged 65 and older, the fastest growth of any age group. Downsizing, flexibility and predictable costs trump lawn care and leaky roofs.

The third is aging-in-community. Naturally occurring retirement communities (NORCs) or “Villages” co-ordinate services—rides, vetted contractors, social clubs—in ordinary neighborhoods. They replace concrete with coordination. States are subsidizing them and legalizing accessory dwelling units, or granny flats, to bring lower-cost options closer to kin.

The policy backdrop

Behind all this lies the collapse of the caregiver ratio: from seven potential carers for each octogenarian in 2010 to four by 2030 and heading below three by mid-century. Families still supply care worth some $600bn a year. But as marriage and fertility shrink, more elderly Americans will live without spouses or children nearby. Housing that bakes in social ties and light support is no luxury; it is an informal wing of the long-term-care system.

Investors, operators, governments

For operators, winning designs are modest in footprint but clever in partnerships. They link with telehealth and pharmacy providers, keep pricing modular, and invest in clubs and volunteering rather than marble foyers. For municipalities, the tools are zoning reform and service dollars. For investors, the combination of undersupply and high absorption is enticing—so long as the product clears middle-income price points.

Demand Gap

America’s looming wave of middle-income seniors is creating an opening in a part of the housing market few developers have cracked: luxury-priced, age-restricted units aimed at the “forgotten middle.” A gap analysis using ESRI’s Tapestry data highlights metros where affluent senior-heavy segments such as Silver & Gold, Golden Years and Top Tier are thick on the ground, while supply remains tight and pricing power strong. Ten cities stand out. Boston, where senior-housing occupancy has pushed above 90%, and Washington, DC, with active-adult rents among the nation’s highest, both combine scarcity with wealth. New York, already wrestling with a city-wide rental vacancy of barely 1.4%, has affluent older cohorts clamoring for options, while Chicago offers deep luxury-condo comparable and robust occupancy trends. Portland’s willingness to pay for senior rentals, Seattle’s swelling 65+ renter base and San Diego’s surging senior-renter population underscore demand on the West Coast. San Jose’s equity-rich retirees, Denver’s mix of affluence and in-migration, and Austin’s astonishing 81% growth in senior renters round out the list. Across these markets, fundamentals are aligned: occupancy rates are climbing toward 88%, construction pipelines are threadbare, and active-adult communities are filling at above 92%. For investors, operators and policymakers, the message is clear: the gap for luxury-priced senior housing is not niche but structural, and the cities best positioned to absorb it are already flashing demand signals.

Households themselves

Most over-50s say they want to age in place. But many homes need modifications—step-free entries, safer bathrooms—and many suburbs remain inhospitable without a car. The sweet spot is a hybrid: a right-sized flat in a NORC or active-adult building, with services that can be dialed up or down.

The economics of aging will not soften. But re-conceiving care as a layer rather than a place could draw the forgotten middle—and solo agers—into environments that are both cheaper to run and better to inhabit.

This is a macroeconomic, political, and generational issue. The choice is not whether to act, but whether to pay now through innovation or later through crisis. Middle-income seniors may be a forgotten class today, but they are tomorrow’s majority. The bill is already in the mail. The silver tsunami is not on the horizon—it is here. Whether America builds for it or stumbles into it will decide not just how its seniors live, but how its economy ages too.

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