As the aging population grows and seniors struggle with shrinking retirement benefits, home-sharing is gaining in popularity with baby boomers who want to bring in some extra income — and could emerge as an alternative to tapping into home equity.
One company offering this service is the Denver-based Silvernest, which matches senior homeowners with renters based on applicant profiles and personal preferences. Through the site, homeowners and potential housemates can conduct background checks, “meet” online, create leases, and process rent payments, according to Silvernest CEO Wendi Burkhardt. For boomers and empty nesters looking for extra cash, leasing a room can bring in about $10,000 a year on average.
Home-sharing is not a new idea — think the classic 1980s sitcom “The Golden Girls,” or the popularity of Airbnb for vacation rentals — but it is gaining more traction. Silvernest isn’t the only senior home-sharing service on the marketplace, sharing the space with other sites such as Golden Girls Network and Senior Homeshares, and AARP has found that 4 million women aged 50 and older live in U.S. households with at least two other women over 50. As the population ages, that number is expected to rise.
Amid these trends, the investment world is starting to take notice: Just last week, Silvernest raised $3 million in Series A funding, which the company has earmarked to expand its user base, acquire new talent, and build out their digital platform with “new features and functionality.”
According to Silvernest’s website, the company has received about 42,000 signups, and has qualified more than 40,000 successful matches since launching in 2015. Homeowners pay $49.99 to use the site for 60 days, with background checks and leasing materials available for additional fees.
Adding that she has had reverse mortgage borrowers interested in home sharing, Burkhardt said she sees Silvernest as another option for increasing income, along with equity-tapping tools.
“They can actually work very collaboratively and complement each other,” she said. “They don’t have to be mutually exclusive.”
Available in all 50 states, Silvernest has the greatest following in its home state of Colorado and in southern California — two areas that have similarly seen elevated interest in Home Equity Conversion Mortgages due to strong property values and related gains in home equity.
“In areas where we have seen a high cost of living and less affordable housing, we are seeing greater adoption,” she said. “Typically the cost of renting a room is about half the price of a one-bedroom apartment.”
Along with a financial boost, renters can prevent isolation for seniors who may be living alone after the death of a spouse, and even help with chores around the house.
“It’s typically not caregiving, but it might be light housekeeping or transportation,” she said. “It can solve those problems as well.”
Silvernest’s average homeowner age is 60, but the company has had one as old as 101. The average age of renting roommates, however, sits around 40, proving interest in home-sharing among generations. Roommates are not always single, either: The site has matched couples to rent a room, and homeowning couples have looked for housemates.
Burkhardt describes Silvernest’s matching site as a “blend of a dating site, a real estate site, and a little legal,” and the early success of the site highlights the growing tech-savviness of the boomer generation. Although the company originally publicized a 1-800 number to connect, most of Silvernest’s early consumer engagement was through the site’s online chat option.
“Now about 50% of our traffic comes in through mobile, which I think is really interesting,” she said.
Written by Maggie Callahan