Seniors have something in common with young adults – it’s getting ever harder to find an affordable place to rent.

A new report from the bond-rating people at DBRS says Canada’s seniors face a severe housing shortage that results from a growing demographic of baby boomers turning 65, a low vacancy rate and soaring rental costs.

DBRS says more housing for seniors is being built every year, but it’s not enough to match projected growth in demand. The rate of increase in Canada’s population of seniors from 2006 to 2016 averaged 21.7 per cent, more than double the rate at which the supply of housing increased. Meanwhile, rents are high and rising. The average rent for seniors homes owned by companies rated by DBRS is around $3,552 per month, which is more than double the $1,206 national average rental cost.

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DBRS said the anticipated demand for seniors housing makes this sector an attractive option for investors. But for seniors and their families, it’s a huge challenge that has to be factored into long-term planning. Retirees who plan to eventually move into a seniors home or assisted living facility needs to understand both the cost and availability of units in their community. Will they be able to find an affordable unit when they need it or will there be a long waiting list? Also worth considering is the cost and suitability of home care.

It looks like tight rental markets are going to be a lifelong problem for Canadians. Young people are experiencing it now in some cities and seniors are starting to be affected as well.

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Rob’s personal finance reading list…

We pay less tax than Americans

All the talk about declining taxes in the United States may have given you a false impression of how we in Canada compare. On personal income tax, an OECD report says we pay less than Americans. Canadians with young children pay substantially less tax.

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You can’t kill these plants

Five durable house plants that won’t turn out to be a wasted purchase.

Five reasons your budget is failing

A credit counselling agency’s blog looks at some reasons why budgeting may not be working for you. These guys should know.

Getting soaked by the dry cleaner

The 2018 Global Dry Cleaning Index compares the cost of having a suit cleaned in 100 cities around the world, including Toronto, Ottawa and Montreal. If you wear suits to work, be glad you don’t live in Oslo.

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Today’s featured financial tool

Here’s a calculator that can help your figure out how much income you can safely withdraw in retirement. It was developed by Fred Vettese, actuary and author of the book Retirement Income For Life: Getting More Without Saving More.

Ask Rob

Q: “With interest rates increasing, I’m wondering if it’s a good idea to put more money down on my mortgage, rather than having it sit in a rainy day account. I’m 46, a single mother. I put $10,000 down the other day and [my mortgage] is down to about $196,000. My five-year fixed term is up in three years (rate 2.69%). I have $68000 in savings in a TSFA.”

A: “If the TFSA money is your rainy day fund and not part of your savings for retirement or other financial goals, then it makes sense to use some of it to pay down that mortgage. A standard rule is to have at least three months of expenses covered by your rainy day fund. One further point – most mortgages limit how much you can pay down in a year without penalties. Your lender can tell you what your maximum is.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

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Featured Video

Carrick Talks Money: Should you leave your investment principal untouched in retirement?

In case you missed these Globe and Mail personal finance stories

  • Young Canadians are building wealth and growing nest eggs − while renting
  • Borrowing to invest? Court ruling provides tax guidance
  • As dividend hikes spring up everywhere, here’s a sampling of firms worth following (for Globe Unlimited subscribers)

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