Comparing the Cost of Senior Living vs. In-Home Care

According to a recent Wall Street Journal article, an AARP study revealed that 77% of Americans aged 50 and older want to stay in their homes for as long as possible. While the desire to stay in a beloved family home may not be surprising, the significant cost of remaining there catches many off guard. And should home care or home health care become necessary, the dream of aging in place at home gets even more expensive.

Many seniors and their families view the monthly cost of senior living communities as higher than the expense of staying at home with family care or part-time or full-time home health care. However, a new report released by the American Seniors Housing Association (ASHA), The Surprising Price of Staying in a House, shows how in-home care services can dramatically increase the cost of aging at home, often exceeding the cost of senior housing where around-the-clock supportive care services, daily meals, and social engagement are included in the monthly price.

Dan Bernstein, CFA, formerly of Stifel and Capital One, prepared The Surprising Price of Staying in a House. In this article, we’ll highlight more findings, examine the real (and rising) costs of aging at home, and compare the average monthly cost for senior living communities to the monthly price of in-home care.

Inflation is Driving Rising Costs

Since ASHA’s 2017 comparison of aging in place versus moving to senior living, homeownership, maintenance, and home health care costs have risen faster than those of senior housing. Home prices have jumped 22%, rents by 45%, food by 31%, and home health care costs by about 75%. The financial burden of staying at home—not to mention the emotional strain on families—is substantial, often exceeding what many families have anticipated or prepared for in their retirement and senior care planning. 

Meanwhile, senior housing rents have increased just over 30%, making the monthly cost of senior living comparable to—or even more affordable than—what many seniors currently pay at home when modest home care is included.

Seniors’ Net Worth is Rising

The ASHA brief also noted increases in median net worth among those 75+, primarily driven by increases in home values and the assumption that most seniors own their houses. This also suggests that affordability for seniors’ housing costs has improved since 2017.

The Real Costs of Aging at Home

Many homeowners underestimate the actual cost of aging in place, which involves far more than just the mortgage or rent. Even if the home is fully paid off, there are still numerous ongoing expenses to consider:

• Property taxes
• Home insurance
• Utilities (electricity, water, gas, internet)
• Regular maintenance and repairs
• Lawn care and landscaping
• Housekeeping services
• Groceries and meal preparation
• Transportation costs
• Social activities and entertainment
• Health and wellness services

The ASHA brief estimated that these costs would total about $3,725 for families living in a median-priced house of $400,000. If mobility and health needs change, homes often require significant modifications:

• Installing walk-in showers or tubs
• Adding stairlifts or elevators
• Creating first-floor living spaces (bedroom, bathroom)
• Widening doorways for wheelchair access
• Improving lighting and adding safety features

These modifications can be substantial investments, often ranging from $3,000 to $50,000 or more, depending on the extent of the changes required.

Complete our House vs Community worksheet to uncover the real cost of aging in your house.

The Soaring Cost of Home Care

According to the 2023 Genworth Cost of Care Survey, home care for in-home companions costs around $30 per hour, while a home health aide costs about $33 per hour. Even if you only need four hours of care per day, five days a week, with family helping on weekends, you’d still be looking at around $2,640 per month. However, most care guidelines, including those from Genworth, suggest that 44 hours of care per week is typical, bringing the monthly cost to about $5,808—similar to the cost of assisted living, without even factoring in the expenses of maintaining a home.

When you combine the $2,640 monthly cost of four hours of home care, five days a week, with the $3,725 cost of living in a median-priced home, the total comes to about $6,365 for housing and a modest level of home health care.

The Cost of Assisted Living vs Home Care

The average monthly cost of assisted living ranges from $5,350 (Genworth Cost of Care Survey) to $6,422 (National Investment Center for Senior Housing and Care Vision Map). Even modest levels of in-home health care can exceed these costs, particularly when considering additional expenses such as home maintenance, utilities, and property taxes.

The ASHA brief also compares the cost of home care to independent living and memory care communities. On average, independent senior living is more affordable, at $4,126 per month, lower than both aging at home and assisted living.

Memory care, which offers a higher level of support, averages $8,505 per month. However, when factoring in the cost of 44 hours of weekly care, which is often needed for those living with memory challenges, plus an estimated $3,725 for maintaining a house, the total reaches $9,533—making it more expensive than the average monthly cost of memory care.

Costs of houses valued above and below the median home price of $400,000 were also examined in the ASHA brief.

Download Report

The Added Value of Senior Living

Many don’t consider the value of senior living when comparing the average monthly cost of senior living to aging in the house. In addition to support and care, community life defines maintenance-free living and includes many benefits that lead to healthier, more fulfilling lifestyles. Senior Living communities:

• Promote an active lifestyle through fitness centers, exercise classes, and organized activities, which can improve physical health and mobility.
• Provide opportunities for social engagement and connection, reducing isolation and potentially improving mental health.
• Offer nutritious, chef-prepared meals, supporting better nutrition for residents.
• On-site health services, such as wellness checks and medication management, can lead to better overall health management.
• Cognitive wellness is supported through educational programs, brain-stimulating activities, and social interactions.
• The stress-free environment, with maintenance and housekeeping taken care of, can improve emotional well-being.

How to Pay for Senior Living

Most people use proceeds from the sale of their house, personal savings, and Social Security income to pay for senior living, but there are other ways to supplement how you pay, like Veterans’ Assistance and long-term care insurance, for example. Understanding the financial avenues available will help you form a more accurate picture of what you can afford. Explore your financial options.

The Surprising Price of Staying in a House report confirms that senior living is more affordable than most people think — especially when comparing it to the cost of remaining at home. More importantly, the value it brings to life is priceless.

Where You Live Matters

Where You Live Matters is powered by the American Seniors Housing Association (ASHA), a respected voice in the senior housing industry. ASHA primarily focuses on legislative and regulatory advocacy, research, and educational opportunities and networking for senior living executives, so they can better understand the needs of older adults across the country.

_{Originally Published: October 27, 2018 – Updated On: October 3, 2024}