Text by Gary Haynes of Next Step Real Estate Partners. This story originally appeared in Greenbook Magazine, Volume 6, Winter 2016.
If you are thinking about downsizing, moving to a smaller home that is easier to care for or living independently in a community of like-minded empty nesters, living in a 55+ community may be a viable option for your home investment.
Planned developments catering to the 55+ crowd often feature smaller homes, neighborhood associations that manage the care of homes and common spaces and a range of amenities.
For example, in the Annapolis area, Heritage Harbour features a clubhouse with a ballroom, indoor pool, gym, wood workshop, billiard room, and onsite restaurant. The extensive development offers a golf course, marina, RV and boat storage, tennis courts, and small craft launch sites along the South River. A commuter bus is a particularly valuable asset for the many residents who need rides to local and regional activities, stores, medical centers and other communities.
On the other end of the spectrum are communities like Villas of Rock Oak in Odenton, which offers a minimum of amenities beyond the advantage of living in a community of similarly aged neighbors.
If you are worried that you will eventually be unable to mow your lawn, shovel snow, or even manage stairs or close corridors, or if you want to leave your traditional neighborhood for a community of similarly focused retirees, it may be time to consider the pros and cons of Adult Living Communities.
Why go 55+?
The distinct advantage of living in a 55+ development is the ease of everyday life. The time, energy, expense and consternation you might save by having someone else worry about your property’s upkeep could be remarkable! Beyond the perk of never having to mow your lawn again, consider:
• Kid-free peace and quiet
• An active social life with folks of similar age and interests
• An all-inclusive community that includes a range of activities, from clubs to recreation
• Possible access to transition housing, such as assisted living.
While there are many positive reasons to buy in an Active Adult Living Community (Over 55), there are also potential negatives to consider.
While some active seniors find the non-stop activities, the kid-free environment, and freedom from worry about maintenance and other homeowner chores to be an attractive proposition, there is another segment of retirees who find the rules, expense and planned lifestyle unattractive.
Of course, the elephant in the room is the one best described my client, who exclaimed, “They are all so old!” In fact, ages vary widely in senior living communities. It's true that some communities house residents are well into their 70’s and 80’s. But contemporary development trends cater more and more to younger retirees who want to downsize but not necessarily end their active lifestyle.
If you are going to miss:
- seeing youngsters running around,
- a diversity of ages,
- and a mix of housing styles,
then traditional senior living communities may not be for you.
Many Active Living community amenities are subject to an association fee, and it is important to understand the details of corresponding costs before you invest. There could be a disparity in costs depending on if you purchase a single family home, townhouse, villa or condo.
In particular, investigate what the condo association covers, including maintenance and flat-use fees. Most association costs include at least some portion of grounds keeping. Some include home maintenance repairs for appliances and HVAC or plumbing systems, or even repair of main exterior structures such as roofing and gutters. Conversely, some will not.
You have the right to read the condo/home owner contractual and legal documents before purchase. You also have the right to rescind your contract offer if you decide the community is not a good fit for you. However, it is important to do your research to get a full understanding of what amenities, upkeep and associated fees you will be responsible for, and to include these costs in your consideration of the total investment. Be sure to calculate annual fees compounded over several years, to ensure that you can afford your new home ten or more years down the road.
Most 55+ communities have age ratios they must legally prove in order to retain their land use and tax status. Proof of residency could affect your purchase and financing. For example, if you are 50 years old and decide to buy a home in a 55+ community for your retiring parents there is a strong possibility that they would not be allowed to assume residency because the owner (you) is not age 55 or older. These legalities need to be understood before an offer is made.
An intangible benefit of moving into a 55+, planned community is the ability to live with like-minded people who are around your age and who may enjoy doing things you like to do. On the other hand, you may not be able to pay the expenses of retirement living, or you may not be attracted to interacting with so many like-minded people in such close living quarters. Regardless of your choice, it is important to carefully research the pros and cons of different types of planned living communities, what each offers, any costs you may necessarily incur, and the value of your investment over time as you transition to elder care.