[morgansacre]

Hi,

I have been making some enquiries at the only retirement village, in the town DH and I want to end up in...this is in a tiny country town.

DH and I are selling our home and using what equity we have to buy a caravan and travel around Australia for a few years. This will happen in 2 years when our youngest child has finished YR12. We were going to just live in the self contained caravan at my oldest DDs place when we finally finish travelling. But I thought about checking out retirement homes to see if we could end up there...

The 2 bedroom homes are $185,000,
i just dont know how on earth most retired people can afford them?

This is more than our mortgage now. We need to sell our home as we will not be able to afford our $151,000 mortgage once DH leaves work and we are on the pension and paying all the bills too. We only have around 50% equity so its not that much. With very little super no bank would take us on with a loan even if we had a $50,000+ deposit.

I always assumed that you pay a rent type thing...I knew you pay a yearly or monthly service fee, I just never thought it would involve another mortgage. I understand most retiree's have a lot more equity in there home and/or have a good super...but we don't.

So the reason for coming on here:
Do all retirement homes have to be bought?
Does anyone here have parents etc. in a retirement home?
How do they do it?

Lynn

[kickoponomusinsi...]

Are you talking about the over 50's "gated" community/residential homes, or like nursing residential homes?

[YandiGirl]

Be wary of those retirement places and the conditions associated with them. They often have some very nasty provisions included. You buy in, but there won't necessarily be an asset to be sold once you 'move on'. There are usually sliding scales with the end result being you leave owning nothing.

[TillyTake2]

Not all nursing homes have bonds but most retirement villages etc do.

Fwiw $185,000 is incredibly cheap, around here they start at $500,000!

I know it doesn't help you but I don't think you'll find that there are many people who are about to retire with less than $200,000 in super/cash/equity.

How old are you? I'd be thinking you need to work & save for a few more years. My parents both still work, both in their mid 60's.

[soontobegran]

Around these parts it will cost at least $400k for a decent home in a decent retirement village so it seems to be only an option for those who have already paid off their mortgage and will have the money made from the sale of their home to get them in.
My mum and dad bought into a retirement village but they are bound by so much red tape when it comes to the sale of the unit when they die that is seems to be a nightmare best done without.

I really know very little about the process other than what I have seen happen to my parents and friend's parents but as I said they were all homeowners free of mortgages.

Good luck, I guess we need to think about this sometime in the next decade. I love the idea of being grey nomads Lynn. I hope someone has more information to help you with.

[jojonbeanie]

DH and I are selling our home and using what equity we have to buy a caravan and travel around Australia for a few years. This will happen in 2 years when our youngest child has finished YR12. We were going to just live in the self contained caravan at my oldest DDs place when we finally finish travelling.

Given your financial instability perhaps it is not wise to sell off your only asset and invest the money in something which is only going to depreciate. Aren't you going to need as much money as possible for future medical expenses, accommodation, vehicles and care?

[Peppery]

My grandfather purchased a villa in a retirement village, we he passed away the retirement village gave his estate a sum of money that was agreed upon at time of purchase. It did not reflect the current purchase price for the villa.

I think he used to pay a weekly maintenance fee as well.

[morgansacre]

It's a retirement home where you come and go as you please. If you pay the service fee they will do all maintaince on the house and front yard free. There are no medical services connected with it, so it's not a nursing home.

I will be 51 next month and I can't work, DH will be 68 next month and wants to retire from work at the end of June 2015. So us working longer is not an option.

Lynn

Ok it seems like a retirement home is not really a good thing. Tats ok it was just an idea. DD has offered to pay half for a granny flat on her property, which we are thinking about...I just don't like the idea we may be stuck there.

This post has been edited by morgansacre: 06/02/2013, 05:35 PM

[TillyTake2]

If I was in your position I wouldn't be selling my only asset & spending the only money I had left to live off forever on a holiday... Just saying...

[Mumsyto2]

[quote name='morgansacre' date='06/02/2013, 05:07 PM' post='15306384']
The 2 bedroom homes are $185,000,
i just dont know how on earth most retired people can afford them?
/quote]
You are obviously not looking in Sydney - I have eyeballed them for the future & you would struggle to get a 2 bedder for under 650/700 in any half decent area. I would think 185K is a steal