Older Americans still house poor since recession

Percy and Beverly Evans are one strike away from foreclosure on the home they purchased 13 years ago

May 29, 2015 4:00PM ET

by Ehab Zahriyeh @EhabZ

Thirteen years ago, Percy Evans and his wife, Beverly, both in their 60s, made the decision to follow the typical American dream and purchase a home in Milwaukee, Wisconsin.

But since making that decision, life for the couple has been far from a dream. “If I know then what I know now, I don't think I'd buy a house,” Percy, 66, said in episode 5 of the six-part documentary series “Hard Earned,” airing Sundays on Al Jazeera America.

They purchased their home for $79,000. With an interest rate at nine percent, the couple’s payments are just over $1,100 a month, but after more than a decade of paying it off, they still owe the full principal amount on the home.

Employment level - 65+ years old

Source: Bureau of Labor Statistics

During the Great Recession, Percy lost his $45,000-a-year job as a maintenance worker and now makes $10.50 an hour as a night janitor. Beverly also lost her job when the social service agency she worked at closed down, bringing the couple’s dual income down from $99,000 a year to just over half of that.

Their lower income reflects growing trends in the U.S., where middle-wage jobs are being replaced by low-wage positions. Thirty-seven percent of mid-wage jobs were lost during the recession, but they only saw 26 percent growth after the recession ended, according to a 2014 report by the National Employment Law Project. Lower-wage jobs, however, recovered their losses by two-fold.

“Lower-wage industries constituted 22 percent of recession losses,” but saw 44 percent of recovery growth, according to the report.

Tough economic times have hit aging Americans especially hard. In the last 20 years, the number of Americans approaching retirement age — 65 years and older — in the workforce has doubled from 3.7 million 1994 to 8 million 2014, according to the Bureau of Labor Statistics.

After missing a couple of mortgage payments, the Evans are close to losing their home to foreclosure. They would hardly be alone. "More than 1.5 million people age 50-plus have lost their homes since 2007 (to foreclosure) and at least 3.5 million more remain at risk at this most vulnerable stage of their lives,” according to an AARP report.

In the unfortunate event that the struggling couple does lose their home, renting will likely not alleviate their woes. A majority of Americans believe that it is challenging to find affordable quality housing – whether renting or buying, according to a How Housing Matters survey.

In official parlance the Evans, like many other homeowners, are “housing cost-burdened” — families who pay more than 30 percent of their income for housing and may have difficulty affording necessities such as food, clothing, transportation and medical care.

“An estimated 12 million renter and homeowner households now pay more than 50 percent of their annual incomes for housing,” according to Department of Housing and Urban Development (HUD).

"Over half of all adults (52 percent) have had to make at least one such sacrifice in the past three years to ensure that they can cover their rent or mortgage," the study found.

Paying their mortgage is prioritized over other expenses or wants for Percy and Beverly, the couple said. And that causes them immense concern.

“I think you need to be able to do something other than pay for a house and sit up in it," Beverly said. We “can't go anywhere; can't do anything; can't have anything."

"That's what we mean by being house poor," she added.