So, The Great Recession is Over?
On September 20, 2010 The National Bureau of Economic Research announced that the recession had ended in June of 2009. Many would look at this as positive information. But, if you happen to be a part of housing for seniors, you would beg to differ.
Let me tell you what has happened since June 2009. Independent Living for seniors has been decimated. If you had the good fortune of providing Independent Living before the downturn in 2007, you are most likely counting your misfortunes. We certainly are among those spewing cash like the Deep Water Horizon Well in the Gulf. There is no “top kill” for an economy where a house can’t be sold. And, even it can, it’s perhaps at 50% of its value of just a few short years ago.
Senior financial vehicles such as pension funds and, the favorite product of senior citizens, the certificate of deposit have either lost so much value or pay so little interest that they are no longer viable to sustain living expenses.
For the operator that may choose to attempt to provide benefits for their employees, he is facing 30% or greater increases in premiums; completely the opposite of what was sold. Nearly every resident inquiry has some financial issue or barrier to deal with before the potential resident can think of moving in.
Assisted Living has now become a life style decision not a need-based decision. Families are now taking mom or dad or both out of a community because they need their Social Security income to live on. Foreclosures are rampant and no one seems to care. The care of mom and dad has become secondary to simple survival.
We have employees who have lost their homes and become homeless; lost their kids to state custody because they can’t take care of them; lived without basic utilities because they were cut off due to non payment. Local oversight agencies have been cut back so much they no longer will investigate an allegation of abuse simply stating “there is nothing we can do”.
Unemployment continues to hover around 10%. On a recent visit to Nashville, it was reported that home closings are down 19% from last year, when the recession supposedly ended.
In reality, this announcement could be the worst news we could receive. This recession is not over, far from it. The bigger question is: will our senior citizens be able to live out their lives with the peace of mind that they will have enough money to the end? In the end, the sad story here is this could have been prevented or at the least minimized by simply following sound basic financial principals.
From our position and perspective, these are troubling times. How it will play out, we can only wait and find out.