The 3.6% Social Security Raise for 2027 and a Retiree's Housing Budget

Social Security benefits rise 3.6% in January 2027, the largest cost-of-living adjustment since 2023. For the average retired worker that is about $75 more a month. The harder question for anyone who owns a home, or plans to buy one in retirement, is how much of that $75 is left after Medicare takes its share and after the bills attached to a house go up too.

The short version: the raise roughly keeps pace with the cost of owning a home, it barely changes what a lender will approve, and it should not be the reason a retiree stretches for a bigger house.

The 2027 Numbers

The Social Security Administration announced the adjustment on Oct. 14, 2026. The figures below come from the agency's announcement and its notice in the Federal Register, summarized on the SSA cost-of-living adjustment page.

• Increase: 3.6%, applied to benefits for December 2026, which are paid in January 2027. Supplemental Security Income payments rise starting Dec. 31, 2026.
• Average retired worker: about $2,170 a month, up from about $2,095.
• Average couple, both receiving benefits: about $3,355 a month, up from about $3,238.
• Taxable maximum: earnings up to $192,300 are subject to the Social Security payroll tax in 2027, up from $184,500.
• Earnings limit before full retirement age: $25,560 for the year, up from $24,480.
• Earnings limit in the year full retirement age is reached: $67,920, up from $65,160, counting only the months before that birthday.

The increase is the same percentage for every beneficiary, so the dollars scale with the check: about $72 on a $2,000 benefit and $108 on a $3,000 benefit.

One point matters for people who have not filed yet. The adjustment applies to anyone who reached age 62 before 2027, whether or not benefits have started. A 65-year-old waiting until 70 still has the 3.6% built into the future benefit. Filing early to "catch" a cost-of-living increase gains nothing.

What Is Left After Medicare Part B

Most retirees on Medicare have the Part B premium deducted from their Social Security payment, so the deposit never rises by the full adjustment. In 2026 the standard premium is $202.90 a month and the annual deductible is $283, according to the CMS fact sheet on 2026 Part A and B costs.

As of Nov. 9, 2026, the Centers for Medicare & Medicaid Services had not published the final 2027 premium or deductible. The 2026 figures were announced on Nov. 14, 2025. The only official figure available is a projection: the 2026 Medicare Trustees Report, issued in June, estimates a 2027 standard premium of $209.50 a month and a deductible of $292. The final numbers can differ from the projection.

If the projection holds, the premium rises $6.60 a month, and the average retired worker nets roughly $68 of the $75 increase. That is a better result than a year ago, when a 2.8% adjustment added about $56 to the average benefit and a $17.90 jump in the Part B premium took nearly a third of it. Retirees with higher incomes pay income-related surcharges on top of the standard premium and will net less.

Each beneficiary's exact figure arrives in the annual notice. Social Security says the notices are available online in a my Social Security account starting in late November and are mailed in December, and that the 2027 Medicare premium will appear in the account's message center starting in late November.

How the Raise Compares With the Cost of Keeping a House

A home with no mortgage still sends bills, and most of them have been climbing at about the same pace as the adjustment or faster. Bureau of Labor Statistics data for the 12 months ending September 2026 show:

• Overall consumer prices: up 3.7%
• Shelter: up 3.2%
• Electricity: up 4.4%
• Piped natural gas: up 5.0%
• Water, sewer and trash service: up 4.8%

Insurance has moved faster. NerdWallet's 2026 analysis put the national median homeowners premium at $2,490 a year, up 6% from 2025, a trend covered in the report on why homeowners insurance keeps rising. Property taxes and association dues are set locally and have no national index, which makes them the two lines worth checking on a specific house before buying.

A simple illustration shows the scale. Suppose a retired owner with no mortgage spends $900 a month on property tax, insurance, HOA dues and utilities combined. If those bills rise 5% in 2027, that is $45 a month, about two-thirds of a $68 net raise, before groceries, fuel or medical costs are counted. For an owner with a fixed-rate mortgage, the principal and interest stay flat, which is the one housing cost inflation cannot touch. The case for owning free and clear is laid out in the piece on the real value of a paid-off home in retirement.

How Lenders Count Social Security Income

Retirees can and do qualify for mortgages on Social Security, pensions and investment income. Fannie Mae's Selling Guide, which sets the rules for a large share of conventional loans, treats Social Security retirement income this way:

• Documentation. A lender can accept the SSA award letter, the SSA-1099, recent signed federal tax returns or proof of current receipt.
• Continuance. For retirement benefits drawn on the borrower's own work record, the lender does not have to verify that the income will continue unless there is reason to think it may not. Benefits drawn on someone else's record need documentation that they will continue at least three years.
• Gross-up. Because part of a Social Security benefit is typically not taxed, a lender may treat 15% of it as nontaxable without extra paperwork and increase that portion by 25%. In the guide's own example, a $1,500 monthly benefit becomes $1,556 of qualifying income. Grossing up a larger share requires documentation that more of the benefit is tax-free.

That gross-up works out to an increase of 3.75%. Applied to the 2027 averages, a $2,170 benefit counts as about $2,251 a month and a couple's $3,355 counts as about $3,481. FHA, VA and individual lenders have their own versions of these rules, so the loan officer confirms what applies to a given file.

What the raise adds to buying power

Not much. Fannie Mae allows total debt payments up to 50% of income on loans approved through its automated system and 36% to 45% on manually underwritten loans. Take 45% as an example. The average $75 raise becomes about $78 of qualifying income, which supports about $35 more in monthly debt. At the 7.18% average 30-year rate Freddie Mac reported on Nov. 5, 2026, $35 a month covers the principal and interest on roughly $5,200 of loan. For the average couple, the $117 raise supports about $8,100.

The larger lesson is in the base numbers. At 45%, a single retiree with only the average benefit could carry about $1,013 a month in total debt, and that has to cover property tax, insurance and HOA dues along with the loan payment. This is why most retirees who buy do it mainly with equity from a previous home and use a small loan, or none.

Planning a Purchase or a Downsize Around the 2027 Raise

• Budget on the net deposit. Use the amount that lands in the bank after Part B and any tax withholding, and wait for the final 2027 premium before fixing the number.
• Use the new figure on a loan application. A buyer applying in early 2027 should bring the 2027 notice so the lender can work from the higher benefit.
• Price the house's recurring bills first. Ask for the current property tax bill, an insurance quote and the HOA budget, including any planned increase.
• Treat the raise as a cushion, not capacity. It exists to offset price increases that have already happened. A payment that only works if every future adjustment arrives on time is too tight.
• Count wages carefully. Retirees who work before full retirement age have $1 in benefits withheld for every $2 earned above $25,560 in 2027, which can reduce the income available during those years.
• Compare the alternatives. Moving to a smaller home can cut every recurring line at once, though the math has changed, as explained in the look at when downsizing still makes financial sense. Buyers 62 and older who want no monthly principal and interest payment can also study the reverse mortgage for purchase.

Where a retiree lives changes the result as well. A handful of states still tax Social Security benefits, and property tax rules vary widely, a comparison covered in the guide to the most tax-friendly states for retirees. A tax professional can confirm how much of a benefit is taxable in a given household.

How It Plays Out in Nevada

Nevada has no personal income tax, so the 2027 increase is not reduced by a state tax on benefits. The state also limits how fast a property tax bill can grow. In Clark County, which includes Mesquite, the annual increase on a qualifying owner-occupied primary residence is capped at 3%, below the 3.6% adjustment, as detailed in the explainer on how Nevada's property tax cap works. Insurance, utilities and HOA dues carry no such cap, so those are the lines to verify on any home under consideration. Current listings and more research for retirement buyers are available at Homes For Sale In Mesquite Nevada.