Like any other housing, the cost of residing in an independent living community varies. Just as a luxury home in Beverly Hills is more expensive than a ranch house in Topeka, the units in some retirement communities cost more than those in other communities. And just as the rent charged for a single bedroom apartment in Waco is less than the cost of renting a penthouse apartment in Manhattan, rents in independent living communities depend upon location, the size of the unit, and other factors.
Renting a unit in an independent living community may be less expensive than the continuing cost of owning the family home. Seniors who rent units in retirement communities save the cost of mortgage payments, property taxes, homeowner’s insurance, home repairs, lawn maintenance, and the other expenses of home ownership. “Downsizing” to a condominium or townhouse may also produce a cost savings for retirees who choose to purchase a unit in an independent living community.
Owning Versus Renting
Factors that Influence Cost
Geographical Cost Comparison
Extra Costs
The Value of Comparison Shopping
Some independent living communities are age-restricted “villages” or buildings in which residents own their own homes. Residents in those communities typically purchase condominium units or townhouses. Some communities feature small, free-standing houses in addition to townhouses.
The cost of purchasing a unit depends upon the strength of the real estate market as well as the size, location, and desirability of the property. In addition to paying the purchase price, property owners in an independent living community pay monthly “dues” or fees that cover the cost of amenities and services.
Other independent living communities make units available for seniors to rent. The monthly rental fee usually covers the right to occupy the unit as well as the basic services and amenities that the community provides.
Amenities in an independent living community have an impact on the amount a senior will need to pay for rent or fees. Communities that offer spa services, golf courses, and a large menu of activities tend to be more expensive than those that offer more limited amenities.
Unit size and the location of the unit within a building or community has an impact on rental cost. The square footage of a one-bedroom apartment will vary from community to community. Other factors being equal, those that offer larger apartments generally charge a higher rent than those that offer less spacious apartments. Some communities give residents a choice of unit sizes and floor plans at different price points.
Within a community, a studio apartment with a kitchenette will be less expensive than a two-bedroom unit with a full kitchen and a patio or balcony. Units that have a nicer view and those that open onto a golf course or swimming pool might also be more expensive than units in less desirable locations.
Communities that offer furnished apartments may charge more than comparable communities that rent unfurnished apartments. The quality of furnishings and fixtures also influences cost. Seniors pay a premium to live in “luxury” apartments.
Alert: Seniors may save money by finding a community that has a high occupancy rate. Since communities typically divide maintenance and operational costs among residents when they assess fees, a low occupancy rate means that each resident pays more than they would if those costs were shared by a larger group of people.
As is true of all other kinds of housing, geography has a significant impact on cost. Renting in Massachusetts, New York, or California will be more expensive than renting comparable property in Oklahoma or Mississippi.
A state-by-state survey of independent housing costs was completed by SeniorHomes.com in 2012. Here are some examples of the cost of renting a single-occupancy room in various states:
| State | Minimum | Median | Maximum |
| Arizona | $1,049 | $2,382 | $4,558 |
| California | $1,100 | $2,814 | $6,825 |
| Florida | $1,174 | $2,545 | $4,700 |
| Hawaii | $2,195 | $2,564 | $3,099 |
| Illinois | $499 | $1,859 | $3,800 |
| Kentucky | $1,580 | $2,435 | $3,393 | Maryland | $1,334 | $3,238 | $5,420 | Missouri | $899 | $2,087 | $2,975 |
| New York | $956 | $3,895 | $6,605 |
| Ohio | $937 | $2,450 | $4,200 |
| Oklahoma | $1,149 | $1,865 | $2,580 |
| Pennsylvania | $1,590 | $2,690 | $5,249 |
| Tennessee | $999 | $1,972 | $3,090 |
| Texas | $700 | $2,225 | $4745 |
| Wisconsin | $928 | $2,034 | $3,775 |
While geography has an impact on pricing, these figures make clear that a variety of price points are available within each state. How much a senior chooses to spend for independent housing will depend upon the senior’s budget as well as the quality of housing and the associated amenities that the senior desires.
All independent living communities include basic services, such as grounds maintenance, within the rent or fees that residents pay. Some communities charge “all-inclusive” rates while others charge “add-on” fees for services that seniors may elect to use or forego.
Some communities charge a one-time fee to join the community. That fee may or may not be refundable when the resident moves out or dies. An additional fee for a rental unit may also be charged if it will be occupied by more than one person. Renters can also expect to pay a security deposit.
Tip: When seniors compare costs of various communities, they must keep in mind the difference between “all-inclusive” and “add-on” fees. A true cost comparison can only be made by adding in all the fees that seniors are likely to pay in each of the communities they are considering.
The Value of Comparison Shopping
Seniors must answer some basic questions about retirement living before they can select the independent living community that is right for them. Seniors should ask:
- Where do I want to live? Some seniors want to stay close to home to be near family and friends. When children have moved away, some seniors want to move to a community that will be closer to their children and grandchildren. Some seniors want to move to warmer climates while others have always dreamed of having a view of the ocean or a mountain view. Since geography has an impact on price, deciding where to live is one of the first questions retirees must address.
- Do I want to rent or buy? If seniors are selling a home, they should decide whether they will invest all or part of the sale proceeds in the purchase of a retirement unit or whether they would prefer to rent. They should keep in mind that ownership will entail additional costs, including property taxes.
- What can I afford? As a general rule, assistance programs do not cover the cost of buying or renting within an independent living community. Seniors should take a realistic look at their retirement income from investments, retirement plans, and social security. Then they should make a budget that covers their anticipated monthly cost of uninsured healthcare, transportation, and other living expenses. Subtracting expenses from income will give seniors a sense of how much they can afford to budget for housing.
- What amenities do I want? Since cost varies with the amenities that independent living communities offer, seniors should prioritize those they must have, those they would like to have, and those they can live without.
After seniors make a budget, decide where to live, and decide which amenities are the most important, they will be in a position to investigate their options. That search can begin on the internet. After narrowing the field to independent living communities that fit the senior’s budget and needs, it will be time to visit them and decide which one is best suited to the senior’s lifestyle.
Tip: It pays to shop around. There may be a number of choices available in the part of the country where seniors plan to live after retirement. Similar communities that are located only a few miles apart may have significantly different rents and fees. After deciding what they are looking for and what they can afford, seniors should visit several different independent living communities and compare costs before making a final decision.