As retirees navigate life in the post-pandemic economy, the results of the 24th Annual Transamerica Retirement Survey, conducted in fall 2023 but released this week, underscored the importance of age-friendly, affordable communities that promote social connections and access to essential services.

While many retirees (62%) chose to remain in the same home in which they lived before retiring, 38% decided to relocate, according to the survey of more than 2,400 U.S. retirees.

“Retirement brings new opportunities in terms of where and how we want to live, whether it be moving to a new location or simply staying put,” says Catherine Collinson, CEO and president of the Transamerica Institute and the Transamerica Center for Retirement Studies. “Plan advisers can help pre-retirees and retirees envision their housing plans as part of their overall financial strategy for retirement.”

According to the survey, those retirees who relocate often do so while prioritizing affordability, proximity to loved ones and access to resources that enhance their quality of life. More specifically, respondents’ top motivations were: being closer to family and friends (36%); downsizing (33%); reducing living expenses (26%); starting fresh in a new phase of life (24%); and seeking better weather (20%).

The survey also highlighted the importance of community and affordability when retirees select a place to live. The top factors they reported considering included affordable cost of living (65%); proximity to family and friends (61%); access to quality health care (49%); low crime rates (48%); and good weather (42%).

Other notable responses included leisure activities (28%), walkability (24%) and convenient transportation options (20%). Some retirees also reported valuing pet-friendly housing, cultural opportunities and community engagement, which Transamerica noted underscore the importance of diverse and inclusive living environments.

Changes to living situations may, of course, depend on retirees’ financial situations. Many retirees face significant challenges in managing their money, with the median total household savings (excluding home equity) estimated at just $71,000. Meanwhile, 14% of retirees report having no retirement savings at all, and 29% have less than $100,000 saved.

Household Composition and Housing Trends

Despite the desire for community, most retirees live in their own private residences: 74% of retiree respondents reported living in single-family homes (74%), with smaller proportions residing in multi-unit housing (21%) or retirement communities (3%), according to the survey.

Among married or partnered retirees, the majority live with a spouse or partner (54%), while a notable 26% of retirees live alone.

Intergenerational living arrangements are also common, with 23% of retirees sharing their home with children (19%), grandchildren (6%) or even parents (2%). These living situations highlight the continued role retirees play in family dynamics, even after stepping away from the workforce, according to the researchers.

“Whether deciding to own or rent, it’s critical that pre-retirees and retirees factor the costs, benefits and potential risks,” says Collinson. “On one hand, home ownership can bring home equity and help serve as a hedge against inflation. But it also involves a mortgage (for many people), property taxes, ongoing maintenance, repairs, insurance-related costs and fluctuations in market value. In contrast, renting offers greater flexibility, but there’s also the risk of rent increases that may be difficult to absorb if living on a fixed income.”

Home ownership remains a cornerstone of retirement security, with 73% of retirees owning their homes. The median home equity among retirees stands at $114,000, but 24 of retirees lack home equity entirely.

The findings are based on a 25-minute online survey conducted by the Harris Poll on behalf of the Transamerica Institute and Transamerica Center for Retirement Studies. The survey included 10,002 U.S. adults, with a subsample of 2,404 retirees, conducted between September 14 and October 23, 2023.