Housing in Retirement RFP

Background and Purpose

Decisions about housing are among the most consequential decisions that people make over their lifetimes. These decisions do not necessarily get any easier as people age and move into and through retirement. Although most people reach old age in homes they have been living in for years and where they say they want to remain, their homes, their financial resources, and their support networks may not facilitate aging in place. Decisions about what to do and where to go are inextricably bound with different levels of physical ability and cognitive functioning that people may contend with as they age.

The issues that arise in considering housing in retirement are varied and broad. In addition, they may involve a wide variety of stakeholders both directly and indirectly, including families, financial institutions, advisors and policymakers. Increasing life expectancy, the recent rapid rise in mortgage rates, and climate risk, among other matters, add uncertainty to decisions about housing in old age.

Given the importance of housing to physical and emotional well-being and the complexities surrounding making wise housing choices at all ages, including very old age, the Society of Actuaries (SOA) Research Institute’s Aging and Retirement Research Program would like to explore this topic from the perspectives of a variety of retirement system stakeholders. The intended result of this effort is to provide a useful resource that helps readers better understand the issues surrounding housing in retirement and make better retirement housing decisions.

Research Objective

The sponsors are seeking researchers to undertake a project that would result in either:

(a) a primer that includes a thorough review and discussion of retirement housing issues such as listed below or,

(b) a study that is focused on a specific housing issue and provides new insights in this area.

The following are examples of important housing questions that might be addressed. Respondents to this request are not required or expected to try to address all of these topics. They should also feel free to make a case for examining another topic or topics.

In terms of time horizon, respondents should, to the extent possible, address housing issues for both current and future retirees. Respondents are, however, free to make a case for covering only one aspect. In either case, the proposal should be specific about what will be covered.

Adequacy and Supply of Housing

• What do we know about the adequacy of the housing among today’s aged, acknowledging the heterogeneity of that population, e.g., the very old, those with dementia, the disabled, those without a support network, etc.? Are today’s elderly over-housed? Is there a housing crisis facing the elderly? If so, what does it look like? What does the future seem to hold when it comes to housing in retirement?
• How do housing shortages impact retirees and their ability to find better or more appropriate living situations?
• What policy issues affect the supply of housing for retirees? To what extent is housing for the elderly incorporated in community planning? Are there any best practices that might be suitable for implementation on a wider scale?

Investment and Costs

• How important is it to consider housing investment as a part of the total retirement portfolio and overall asset allocation? What factors change the percentage of a portfolio that is prudent to invest in housing?
• What are the trends in mortgage holding in retirement? What are benefits and pitfalls of having a mortgage in retirement? What challenges (e.g., availability of products, application process, other) may retirees face in seeking mortgages?
• What are the pros and cons of using reverse mortgages in retirement? What challenges may be encountered in obtaining reverse mortgages?
• What are considerations for the proportion of retirement income that is allocated to housing expenses?
• To what extent is investment in housing a good hedge against inflation? What are the implications for homeowners if housing values do not rise?
• For retirees, what risks in retirement impact the need for homeowners’ insurance (and how), the type of insurance that is needed, the ability to get insurance, and the cost of insurance? What risks do renters have in this context?
• How does lack of suitable or affordable home insurance impact retirees vs other homeowners?
• How prominent a role does housing play in retirement planning? How do advisors factor housing issues into their recommendations for their clients? What do they focus on? How can planning be improved?

Location

• What factors impact choice of location for housing in retirement?
• What impact is climate risk having on where to live during retirement? Is it affecting decisions to sell, where to buy, whether to retrofit a home to facilitate aging in place? What impact should it have as we move into the future? Can housing be designed to reduce the impact of major climate events?
• What factors make it desirable to move? What is known about retirees who decide to move before circumstances force them to? What about those for who an event (a fall, incontinence, inability to prepare meals) forces a change? How are the decisions about where to go made? How do those elderly fare? What can be done to facilitate early decision-making?

Housing Types and Arrangements

• When might it be desirable to share housing with others for retirement and what strategies might be considered?
• What is the role of technology development for homes in helping retirees age in place and/or live a better life?
• What factors should be taken into consideration as retirees’ transition through various stages of retirement and their housing needs and desires change? What role do housing modifications and technology play in these considerations?
• How do housing choices impact retirees’ opportunities for social connections and support?
• What is an Age Friendly Community and how does “age friendliness” affect senior residents?
• Continuing care at home programs and other community services can help people remain at home until older ages than in the past. How effective have such programs and services actually been in delaying entrance to assisted living facilities, nursing homes, or memory care residences? What has the impact been on the facilities themselves, e.g., how much has the average age of entry been increasing? Are the services that these facilities must provide to residents changing? Are they becoming more costly? What are the implications for potential residents? What are the implications for owners and developers?
• What types of specialized housing options (e.g., life plan communities, assisted living facilities, board and care homes) are available to the elderly? What are their advantages and disadvantages? What should older people and their families consider when thinking about whether to move to such housing? What should be taken into consideration when evaluating such facilities?

Again, the list above is not meant to be exhaustive but merely examples of the types of topics that could be researched.

Proposers should thoroughly describe the issues on which they intend to focus in their proposals.

Rules for Submission of Research Proposals

Proposal Requirements

To facilitate the evaluation of proposals, the following information should be submitted:

1. clear and concise discussion of the research problem(s) or question(s) that will be examined and why the problem(s)/question(s) is significant. Why should the Society of Actuaries Research Institute support such research?
2. An outline of the methodological approach to be used (e.g. literature search, model, etc.), emphasizing issues that require special consideration. Details should be given regarding the techniques to be used, collateral material to be consulted, and possible limitations of the analysis.
3. A description of the expected deliverables and any supporting data, tools or other resources.
4. Resumes of the researcher(s), including any graduate student(s) expected to participate, indicating how their background, education and experience bear on their qualifications to undertake the research. If more than one researcher is involved, a single individual should be designated as the lead researcher and primary contact. The person submitting the proposal must be authorized to speak on behalf of all the researchers as well as for the firm or institution on whose behalf the proposal is submitted.
5. Cost estimates for the research, including computer time, salaries, report preparation, material costs, etc. Such estimates can be in the form of hourly rates, but in such cases, time estimates should also be included. Any guarantees as to total cost should be given and will be considered in the evaluation of the proposal. While cost will be a factor in the evaluation of the proposal, it will not necessarily be the decisive factor.
   As a guide for developing the project budget, please review the Historical Project Cost Guide (see Appendix).
6. A schedule for completion of the research, identifying key dates or time frames for research completion and report submissions. The sponsors are interested in completing this project in a timely manner. Suggestions in the proposal for ensuring timely delivery, such as fee adjustments, are encouraged.
7. Other related factors that give evidence of a proposer's capabilities to perform in a superior fashion should be detailed.

Selection Process

The SOA Research Institute will appoint a Project Oversight Group (POG) to oversee the project. The Institute is responsible for recommending the proposal to be funded. Input from other knowledgeable individuals also may be sought, but the Institute will make the final recommendation, subject to Society of Actuaries Research Institute (SOA) leadership approval. A staff research actuary will provide staff actuarial support.

Questions

Any questions regarding this RFP should be directed to: Research-AR@soa.org

Notification of Intent to submit Proposal

If you intend to submit a proposal, please email written notification by July 1, 2024 to Research-AR@soa.org

Submission of Proposal

Please email your proposal to Research-AR@soa.org, proposals must be received no later than July 15, 2024.

Conditions

The selection of a proposal is conditioned upon and not considered final until a Letter of Agreement is executed by both the Society of Actuaries Research Institute and the researcher.

The Society of Actuaries Research Institute reserves the right to not award a contract for this research. Reasons for not awarding a contract could include, but are not limited to, a lack of acceptable proposals or a finding that insufficient funds are available. The Society of Actuaries Research Institute also reserves the right to redirect the project as is deemed advisable.

The Society of Actuaries Research Institute plans to hold the copyright to the research and to publish the results with appropriate credit given to the researcher(s).

The Society of Actuaries Research Institute may choose to seek public exposure or media attention for the research. By submitting a proposal, you agree to cooperate with the Society of Actuaries in publicizing or promoting the research and responding to media requests.

The Society of Actuaries may also choose to market and promote the research to members, candidates and other interested parties. You agree to perform promotional communication requested by the Society of Actuaries Research Institute, which may include, but is not limited to, leading a webcast on the research, presenting the research at an SOA meeting, and/or writing an article on the research for an SOA newsletter.

Conflict of Interest

You agree to disclose any of your material business, financial and organizational interests and affiliations which are or may be construed to be reasonably related to the interest, activities and programs of the Society of Actuaries Research Institute.

Appendix

The cost ranges below are intended as a guide for budgeting project costs for proposals in response to SOA Research Institute Request for Proposals (RFP). Please note these figures span the 33rd to 66th percentiles for all projects as well as projects that involve a specific approach (lit review, survey, etc.). They are based on historical costs over several recent years. Expected costs for some RFPs may fall outside these ranges depending on the nature of the work and resources required for completion.

All Contracted Projects

This category includes all contracted projects that the Institute has undertaken within the last several years.

The 33^rd-66^th percentile project costs range is $25,000 - $50,000.

Literature Reviews

This category includes projects that involved only a literature review or the cost for the portion of a larger project that included a literature review.

The 33^rd-66^th percentile project costs range is $15,000 - $20,000.

Surveys

This category includes all projects that had a survey as their primary component.

The 33^rd-66^th percentile project costs range is $28,000 - $55,000.