As many Baby Boomers near retirement age, the stage is set for social shifts nearly as dramatic as the ones that shaped the 1960s – shifts that are already affecting housing patterns. People in their late 50s and 60s will be asking themselves important questions about the suitability of their living situations to changed professional, personal and financial circumstances – and the current market offers a number of intriguing possible answers to those questions.
Of course, one of the wonderful things about home ownership is the way we become attached to the places we own, especially when we’ve raised our children in them. In some cases, that attachment will trump any other considerations. However, those other considerations can be very persuasive, especially if you are no longer using the entire house (do you really need three guest bedrooms?) and the cost and effort required to maintain the place have begun to take their toll.
If the family home is no longer serving your needs, here are some options to think about.
Many Baby Boomers are choosing to “downsize” their domestic space (and domestic responsibilities) by moving into compact and convenient condominiums. This can be an especially appealing option for those who are planning to use their post-retirement freedom to travel far and often.
Of course, condos come in all shapes, sizes and settings. Typically, condominium living will reduce your energy costs, cleaning bills (or the energy you have to spend cleaning the place yourself) and the headaches associated with landscaping and general upkeep.
Many condominium buildings provide access to luxury amenities that the solo homeowner can only dream about. It’s not unusual for newer developments to include gyms, pools, recreation rooms and saunas – to say nothing of indoor parking. On the other hand, living in a condo in a converted duplex building might not feel much different from renting an apartment – except for the favourable investment value it offers.
The latter type of condo might be particularly well suited as a summertime headquarters for snowbirds (you might even be able to rent it out while you’re wintering under the sun) – while the former could be ideal for a person or couple who want to experience a taste of sophisticated urban living.
Broadly speaking, there are two types of condo ownership – and both differ significantly from what you may have gotten used to as the owner of a single-family dwelling. The majority of condos on the market today are sold under “divided co-ownership” conditions. In this case, you are buying the unit that you’ll be living in, along with a share in running the building.
However, participation in general meetings does not guarantee that you’ll manage to secure the exact conditions you want. In order to assure yourself of a satisfactory experience, it’s crucial that you examine the building’s current rules and regulations (ideally with the help of a knowledgeable broker) – and even the meeting minutes of the various condo association meetings that have been held over the years. Doing these things before you buy can help you to avoid any unpleasant surprises that might ruin your new, more carefree post-retirement plans.
The other major type of condominium ownership structure is known as “undivided co-ownership”. Generally associated with converted duplexes and other smaller structures, this type of purchase makes you fully co-responsible for every aspect of maintaining the building. This type of condo purchase is harder to finance (banks will often ask for a 20% down payment, rather than the standard 5% associated with divided co-ownership properties), but it does allow you to split the property taxes with your co-owner(s).
The arrangement could definitely lead to trouble, though, if your co-owner is unable to pay her or his share of the roofing, plumbing and other costs. Another thing to watch out for, when considering undivided co-ownership, are restrictions upon rental options that the bank might build into your financial agreement. These could pose a problem, so be sure that you know exactly how you plan to make use of your condo before you agree to purchase it.
Buying a condo can be a wonderful choice for retirees looking to explore a new and less complicated lifestyle. However, especially in this economy, many Baby Boomers are discovering that their children (and even grandchildren) are having difficulties in attaining financial stability. If that’s the case in your family, then perhaps you might want to consider a dramatically different approach to downsizing.
If your house has the right layout for it, a round of renovations (sometimes as simple as converting a garage or a basement into a separate apartment) could turn it into a multi-generational home that solves your family’s problems. This solution offers you a way to help the people you love, while still creating separate spaces that will allow you to enjoy your hard-earned free time and independence.
On the other hand, if your current place does not lend itself to those kinds of renovations, you might want to explore the attractive possibilities offered by a multiplex dwelling or an already-converted multi-generational home. This lacks the poetic touch of bringing the whole family together again under the same roof they shared when the children were young – but it still lays the foundation for a new kind of family home. And either way, you can finally hand over those tiresome upkeep tasks you’ve been shouldering for so long. That’s a good deal for everyone concerned.
Whether you are considering buying a condo, transforming your current property into a multi-generational home, or buying a new house for that purpose, the advice and resources of a real estate broker can make all the difference for you and your family. I invite you to contact me for a no-obligation consultation.
An earlier version of this article I wrote appeared in the Montreal Times newspaper.
I'm Andrew Mitchell, Chartered Real Estate Broker and Owner of Vistacor Realty Group. I help buyers, sellers and investors in the West Island, Montreal and Vaudreuil-Soulanges areas buy and sell homes. My goal is to provide you with useful, straight-forward insights and relevant real estate market updates. Contact me with any questions. Follow me on twitter here.
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