For decades, Florida has been the go-to destination for retirees seeking a sunny, warm, and idyllic place to spend their golden years. Known for its picturesque beaches, vibrant culture, and lack of state income tax, Florida has always attracted retirees from across the United States. It’s no secret that this paradise has been prone to significant challenges, from climate change-induced threats to rising sea levels and extreme weather events. Also, retirees spend 20% more on healthcare in Florida than the national average. But the recent surge in cost of living in Florida has made it truly challenging for retirees to remain in the state.
A Florida house that cost $250,000 in 2018 now goes for $400,000. Source
Surprisingly enough, many people, in general, are still moving to Florida. In fact, it is one of the top states people are moving to, with around 444,484 individuals moving to the state in 2022 alone. However, people aged 65 and over are preferring to leave. Let’s examine the main explanations for this phenomenon:
A. Increasing Demand
Talking about the increasing demand in the state, it can be mainly attributed to the state’s attractive amenities and thriving job market. Florida’s workforce has experienced remarkable growth over the years, consistently managing to outpace both California and Texas in terms of workforce expansion. Notably, despite the slight decline in the growth rate of Florida’s labor force in the recent years, it expanded by 2.3% between February 2022 and February 2023, surpassing the national growth rate of 1.5% with a fair margin. In fact, for more than 30% of the newcomers, job transfers or fresh employment opportunities were the driving factors behind their decision to call Florida home. And let’s not forget the state’s appealing amenities. Florida has got these amazing beaches, awesome natural stuff, and tons of fun things to do. To many, it’s like a dream place to live if you want an exciting and attractive life.
Now, the increasing demand in Florida, as more people move to the state, causes retirees to flee due to several reasons. But ultimately, as more young professionals and families flock to Florida, it’s the subsequent rise in cost of living, that makes it challenging for retirees on fixed incomes to afford their expenses.
According to Amber Dixon, CEO of Elderly Assist Inc., rising inflation rates have made the scenic Florida coastline less appealing for retirees on fixed incomes. “This, coupled with housing price increases, can lead to financial instability for the elderly looking to retire in Florida,” adds Dixon.
i. Housing and Renting
One example of this trend can be seen in Florida’s real estate market. With more people moving to the state, demand for housing has surged, leading to higher property prices and rents. The median home price sits at $400,000, experiencing a 3.2% year-on-year increase, 60% in the last five years. This steep rise in housing costs can be particularly challenging for retirees on fixed incomes. Struggling to keep up with the escalating expenses, many of them are ultimately compelled to leave in search of a more affordable alternative. Experts do forecast a 4% decline in median sale price growth for 2023, which would be the first annual drop in prices since 2012.
ii. Goods and services
The increasing demand in Florida, driven by a growing population, poses significant challenges for retirees, particularly in accessing goods and services. The influx of new residents leads to overcrowded establishments, longer wait times, and reduced availability of goods and services, leaving retirees frustrated and dissatisfied. For instance, a recent study found that 75% of retirees in Florida reported difficulty in accessing medical services due to the rising population. Additionally, local businesses struggle to meet the soaring demands, resulting in limited supplies and higher prices, affecting retirees on fixed incomes. According to a survey, 60% of retirees witnessed a noticeable increase in the cost of essential goods like groceries and medications. Consequently, this unfavorable situation prompts some retirees to consider relocating to less populated states with better access to goods and services, further exacerbating the issue.
The influx of people moving to Florida has triggered gentrification, leading to significant challenges for retirees. Gentrification involves the transformation of neighborhoods, often resulting in the displacement of long-time residents, including retirees. For instance, in areas like Wynwood in Miami, the inflow of young professionals and trendy businesses has caused a shift in the neighborhood’s character, making it less attractive to retirees who once enjoyed its charm. Consequently, many retirees are forced to flee Florida, seeking more affordable and supportive communities outside the areas undergoing gentrification.
B. Retirement Community Vulnerability
The reason retirees are fleeing from Florida could be due to the vulnerabilities of some retirement communities in the state. While Florida has a lot of retirement communities to offer, including renowned ones like “The Villages,” there are significant issues that could deter retirees from choosing this state as their retirement destination. One critical concern is the poor state of public transportation, limiting retirees’ mobility and access to essential services outside the community. The education system and medical services in these areas, according to reports, have fell way short of retirees’ expectations, impacting their quality of life. Furthermore, many Florida’s retirement communities are situated close to the coastline or in low-lying areas, putting retirees directly in harm’s way during hurricanes and flooding events. The lack of proper urban planning and outdated infrastructure exacerbates the risks faced by the elderly population.
C. Insurance and Property Costs
Rising insurance costs can be difficult for fixed-income retirees in Florida, leading to their flight from the state. Hurricanes and floods are common in Florida, increasing insurance claims. A study found that insurance premiums for homeowners increased by 32% in the past three years. In 2022, Florida had the highest number of hurricane-related claims — $60 billion of insured damages and $100 billion in total losses. In addition, insurers often perceive retirees as higher risks and face higher premiums. Insurance rates increase gradually until age 50 and then experience a more rapid rise for individuals aged 51 and older. Besides, limited coverage options affect retirees, with many insurers unwilling to cover certain risks. These all insurance-related challenges overwhelmingly force retirees with limited income to seek insurance-friendly states, out of from Florida.
D. Climate Change and Environmental Threats
The vulnerability of older adults to the health effects of the climate change is another key reason why people above 65 are leaving Florida. The state’s aging communities are still more compelled to face ongoing challenges caused by a combination of rising temperatures, sea level rise, and persistent flooding. The threat of frequent flooding, occurring over 26 times a year, not only endangers homes but also jeopardizes essential funding for critical services. And, as people age, their bodies automatically become less resilient to environmental hazards like air pollution, increasing their susceptibility to its adverse impacts. Meanwhile, older adults may also have witnessed changes in their local environments over time, which increases their awareness of climate-related risks, leading them to be more cautious in seeking alternative living conditions.
E. Extreme Weather Events
Extreme weather events, including hurricanes, tropical storms, tornadoes, severe thunderstorms, and heatwaves, are an inherent aspect of Florida’s climate. Currently, Florida is facing a surprising marine heat wave off its coast, with water temperatures reaching unprecedented highs. This alarming situation has scientists on edge, as it now poses a severe risk to the state’s coral reefs, raising concerns about an imminent and severe coral bleaching event. Satellite records confirm that sea surface temperatures around Florida have reached 100.4°F, their highest levels in recorded history.
While not the sole drivers of retirees leaving Florida, the impact of extreme weather events and climate change on their decision-making process cannot be underestimated. The gradual rise in numbers reflects this trend, with 60,903 individuals aged 65 and over departing Florida in 2021, compared to 52,630 in 2017, 48,174 in 2016, and 43,356 in 2012.