Senior Citizens - The Next Chapter
“Senior Citizens” is a broad term! Social Security Administration sets the entry to this classification at 62. Some restaurants give “Senior Citizens” discounts for those 60 or older. AARP defines it as ages 50 and older. In Real Estate, there are senior communities defined as 55 or older. So, logically, the needs of people still employed and perhaps in the prime of their careers who are in their 50’s but still categorized as “senior citizens” will have much different real estate needs than those retired and on a fixed income.
This BLOG is focused on and limited to those elderly members of our families who are retired, on fixed and perhaps limited income, and needing to downsize or to move into a different type of living arrangement.
First is a word to the family, especially the adult children and grandchildren. What might seem logical and reasonable from your perspective may be just the opposite or even seem foolish for your aging parents or grandparents. And while logic most often prevails, please do not negate or try to minimize the emotional trauma that may be central to them and unknown to you.
Here is an example.
A widowed woman in her early 80’s was living alone in the family house for more than 60 years. The house was old and needing ongoing repairs that seemed to be draining her income and savings. She was lonely living on her own because her nearest family lived about an hour away and the others scattered. The family was worried for her safety as she was becoming forgetful and they were concerned that she might leave a burner of the stove on or forget to lock her doors at night or any number of other possibilities. So selling the house and moving into an assisted living situation where she could be around people every day, be independent yet monitored for as long as she was able and then progress to some kind of assisted care when the time came was determined to be the best option. But the elderly mother vehemently resisted selling the house and the family bonds were fractured, but certainly not broken. Relationships became strained as the lengthy process drew arguments and disagreements between the mother and other family members.
One would think, as did all her children, that the root cause of the mother’s resistance was that they were selling the house that had been her home for 60+ years. A few of the family members thought it was because she was leaving the neighborhood that she loved. It was not a pleasant transition as the children, obviously “won;” the house was sold and she moved into a safe, well maintained place with activities and people she could enjoy. Everyone was happy - - except the mother!
Not one family member ever asked, I mean REALLY ASKED and REALLY LISTENED as to why she did not want to sell and move. But one of the caregivers, a Nurse Assistant who emptied her trash and mopped her floors ever couple of days, and brought her clean sheets and towels every Tuesday found out because she spent a little time just visiting with her whenever she was in the room as she did her chores. The real reason was because the woman would not be able to take her bedroom set with her because it was too big for her new room. You see, the two dressers, mirror and the bed’s matching headboard and footboard set was the very first purchase she and her deceased husband made after they were married sixty-some years ago when he returned from the war. To her, it represented a lifelong relationship, and now that he was dead, it was all she had left of him that was tangible to hold onto! No one asked because they all assumed! The set was sold at a yard sale. The woman withdrew and continues to this day to live in a very sad state.
Family members, talk to your elderly parents with open minds and ask the hard questions and then LISTEN with your hearts as well as ears. What might this woman’s life be like today if she could have brought with her even one of the dressers or that matching mirror?
Downsizing presents options. Should it be to an assisted living community, or to a smaller house on a smaller lot, or to a HOA community with patio homes that require no outside maintenance, or into another family member’s home, etc.? The choices vary but are generally not easy to make. Often, there are opposing ideas among the adult children and the elderly person or couple needing to move.
A compassionate, independent Real Estate Agent will be a great asset to the family. He or she can be that neutral party who can assess the market and perhaps even act as arbitrator or liaison when family members disagree. He or she can be a respected voice of reason when disagreements arise.
The Real Estate Professional can do a Comparative Market Analysis (generally for no charge) on the property that will objectively show the current market value of the property. An experienced agent can present a statistical, emotionless approach so that the family begins to understand objectively what might be expected after the sale.
The Real Estate Professional can present unbiased options for that next living situation. He or she would be knowledgeable about relative costs of various real estate option, homes on the market, alternative communities and resources for assisted living options.
The Real Estate Professional will be an invaluable resource that every family should engage, just in case members are thinking to “save some money” by doing a For Sale By Owner. For starters, it will require a consensus of the family to arrive at a price. This is very difficult to do when members approach it from a wide range of perspectives. One has emotional ties and thinks it is worth much more than the market will bear. Another wants to “dump it” quickly so everyone can move on. Another doesn’t think that moving mom and dad is a good idea to begin with! Then there are the logistic issues: Who will sit an Open House?, Who will advertise and what kind of advertising will work?, Who will be responsible for arranging showings and answering questions?, Who will prepare the “Sellers Disclosure,” assuming that one or both parents are alive? Who will receive and go over an offer if one should be presented?, Who is point negotiator and how will family members agree on what amount to accept or reject if they are not of one mind as to the value at the start? But a Real Estate Agent does all that and more as he or she remains the professional guiding the family through inspections, possible buyer mortgage issues, knowing what must be completed for DATE SENSITIVE items, title issues that may arise to name but a few common needs. (For more information about For Sale By Owner process, click here.)
But a family should consider other professionals and seek their help as well, especially if the property will produce a sizable profit. Tax consequences and ways to minimize those costs are NOT areas within the expertise of the Real Estate Agent but are services where licensed Tax Consultants and Accountants are experts and who can also be invaluable professional resources to the Senior Citizens themselves and the adult children as well.
A family should seek the advice of an Attorney or Financial Advisor, especially one who specializes in estate planning and is knowledgeable of IRA consequences, Retirement Funds, Medicare, Medicaid, etc. That professional may have suggestions that could protect both the current legal owner of the property as well as those who may inherit it or come to own it while the parent or parents are still alive.
While this BLOG merely scratches the surface of the complexities of Senior Citizen Real Estate, hopefully this will help families think about and better approach this very sensitive and difficult transition.
And so in closing I will emphasize that for the smoothest transition, the following are essentials:
1. Listen. Ask questions. Listen again!
2. Be aware of the emotional components of everyone involved and be open to feelings of others that are different than yours.
3. Engage Professional specialists early on in the thinking or process. These professionals may include a Real Estate Agent, an Accountant, Attorney, and perhaps others as may be required.
4. Maximize your “Long-term” profit that includes both the practical solutions, the financial gains AND the happiness of all family members after the sale.
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- If you or an elderly family member is contemplating downsizing, please give me a call at 724-705-5154, or send me an email at firstname.lastname@example.org. I am always happy to help families walk through this sometimes difficult and emotionally charged process. The consultation is always free & without obligations. You can also visit my website YourNextHomeAwaits.com to read more about my background and reviews of past clients.