We all age, mature, and eventually get to the point where we either do not chose to do certain things or are not able to do the activities that our minds think that we can do. So, it is a question that needs to be answered when we get to this point of wondering – do we sell the house and downsize, or what should we do ?
One of the first things that should be done when seniors are considering their home situation is to discuss this with their family, if they have some. If family is not an option, then possibly a friend who has their best interests in mind and is qualified to give advise, or possibly a reputable family advisor. As baby boomers age and become retirees, this topic will be discussed more and more frequently.
There are a number of issues that need to be discussed. Do the seniors truly love the home and neighborhood that they live in ? Is the layout of the house condusive to someone who may no longer be as physically capable to get around ?
As a licensed realtor, I do run into this scenario. So these are some thoughts and questions that come to mind. My first reaction if someone really wants to continue living in their home even though it is a challenge to keep up with everything, is to encourage them to do so if possible. Is it too much work keeping the lawn mowed and the garden weeded ? Then hire someone. Is there too much snow to shovel in the winter ? What about housekeeping ? Same answer – hire someone. Assistance programs and veterans benefits are possible avenues to investigate in regards to sharing the costs.
Another option could be to do some renovations or upgrades to the home to make it more comfortable. This has the added benefit of increasing the value of the home when it does come time to sell. The trick here is to renovate wisely, spending money in areas that give good return. That in itself is a whole other topic that I will discuss in a future post.
Eventually it may come to the point where it just makes more sense to downsize or relocate, either for time freedom reasons or for financial reasons. So now what to do? Many people think that if you sell the house, the next step is living in an assisted living complex. This may be the case, there are a number of other options worth looking into first.
In some cases, a smaller house makes most sense. Less cleaning and landscaping, possibly lower property taxes, and lower costs to keep the lights and heat on are all areas of consideration. A smaller home closer to the center of activities and services can also save in transportation costs.
Or, sometimes moving to a smaller community makes the dollars stretch further as real estate costs tend to be lower in smaller communities. Possibly a move closer to family ?
Condominium or strata title is a form of ownership, not a type of building. Yes, some condos are apartment style condos, but condominiums are also townhouses, duplexes, and sometimes single family homes within a complex. In each of these scenarios, there are Association fees, which usually cover landscaping, snow removal, and often include a contribution to a fund for exterior repairs.
In condominium living, travelling or going to visit the grandchildren is easily arranged, as there is no worrying about keeping the snow shovelled or lawn cut while you are away. Also in a complex, there is a greater sense of community, and when you do go away, others will keep an eye on your place for you.
Another option that might come up if the seniors have a paid for home is a product called a reverse mortgage. Be very, very cautious when looking at a reverse mortgage. Seniors seem to be susceptible to scams, and reverse mortgages are an area that has hurt a number of seniors. Basically they are taking someone who is debt free and putting them back in debt again.
A reverse mortgage provides funds to the seniors, either as an up front payment, or as monthly payments. In exchange, they register a mortgage on the home, and keep adding the interest and other fees to the amount owed against the property, gradually eating away at the remaining equity in the house. Downsizing and putting the balance of the funds in the bank or investments may be a wiser way to go.
I have heard of some seniors where it made the most sense for them to sell their house, put their money into investments, and just rent a comfortable place. This scenario provides more time freedom with less worries about maintenance and repairs.
There is a segment of society that is moving into retirement and are financially secure. Some of these folks are looking at two homes, one for the winter, and one for the rest of the year. If finances are not an issue, great. There are lots of options available to them.
Many years ago, it was quite common for the grandparents to move in with their children and families. They would help wherever they could in the household and even provide child care when needed. This is happening these days as well to a certain extent. It may be an option for a close family to consider but it does require some serious thought and discussion before a decision is made.
This whole procedure can be a new and exciting stage of life for seniors. Again, give serious thought to your future, and the moves that you may be taking. Remember, the age 70 is the new 60. Or was that age 60 is the new 50 ? Can’t remember. Maybe I am starting to show my age ?