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Kings Place Fleet Retirement development Assisted Living

 

 

You’ve reached a certain age and downsizing feels like the right choice. But what’s next? If you’ve been looking into buying a retirement property you may not be sure whether it is the right move financially. Is buying a retirement property a good investment or a bad one?

As with most things in life, the answer isn’t black and white. It really depends on your personal circumstances and motivation.  Are you simply looking for your next home; somewhere to live your later years in comfort and security, or are you looking for an investment that will appreciate in value and produce a healthy inheritance for your family? Wouldn’t both be nice!

 

Retirement property as an investment vehicle

If you are primarily looking for a property investment vehicle that is guaranteed to appreciate in value and provide a tidy return, a retirement property may not be for you. That’s not to say that a retirement property will lose value because most don’t, but simply that the retirement market doesn’t work in the same way as the wider property market. Depending on where you buy, the type of development, the number of other properties for sale at the same time as yours, and the pool of potential buyers in an area, the sale price at any given time could be more, equal to or less than the price you purchased at.

Sometimes these factors all act in defiance of trends in mainstream property prices.

Every type of property is of course subject to market pressures beyond our control. At present, despite the recession and economic and political uncertainty of the last 10 years, we are conditioned to expect property prices to rise over time, but in reality we need to better manage our expectations. We can do this by ensuring we buy properties armed with the right information.

These properties are built to help people live independently well into later life, so you can avoid worries you’d rather not think of now like having to modify your home for mobility purposes or needing to install emergency alarms, or the emotional and physical upheaval of moving home at an advanced age.

 

An investment in your lifestyle and happiness

At Retirement Move, we encourage our customers to think of buying a retirement property primarily as an investment in quality of life.  If you’re thinking ahead, you could move into a retirement property when you are as young as 55 and still working which, for those who don’t need to be tied down by a family home, allows a lifestyle with more freedom and less stress.

Modern retirement apartments are usually very luxurious and can be decorated in your own style, so there’s no need to feel that by moving into one you’re accepting your advancing age! But you’ll reap the rewards of forward planning because when you can no longer ignore the impact of getting older, the benefits of a retirement property really come into their own.

These properties are built to help people live independently well into later life, so you can avoid worries you’d rather not think of now like having to modify your home for mobility purposes or needing to install emergency alarms, or the emotional and physical upheaval of moving home at an advanced age.

 

Making a decision with your eyes open

We won’t lie, we like retirement properties and believe that they are a good option for many people. That’s why we sell them. But we will offer non-biased advice so, for an objective place to start the decision-making process, here’s our checklist to help you make sure that buying a retirement property is the right investment for you and your family.

  • When you find a property you like in your ideal development, have your solicitor look through the leasehold agreement and talk you through it in detail. Be sure you are aware of all the buying and selling costs as well as the service charge. These vary by housebuilder.
  • Once you have all the information and you are comfortable with it, go through your finances thoroughly. If you have an accountant, ask for their help. Be sure you have enough money not only to buy the property, but to pay the service charge and live comfortably there for at least the next 10 years.
  • Think ahead. Will you be relying on an increase in your property value to pay for a care home, should you find yourself unable to live independently in the future? Are you expecting an appreciation in value in order to provide an inheritance for your family? Do some research into retirement property values in your chosen location to help manage your expectations.
  • Set aside a sum of money that will cover 6 months service charge in the event you sell. This will ensure that, even if the property is vacant at the time, the cost of covering it will not impact you or your family.
  • It’s important that your family and next of kin is aware of and understands all the details of the leasehold and the property itself, as well as your financials. We often find that families are involved when a property is sold, so it’s helpful to have them be part of the process from the beginning.

In our experience, the vast majority of people are very happy with their choice to buy a retirement property. It’s when the time comes to sell that problems can occur, usually due to a lack of research, planning, and communication between family members during the buying process.  Get this part done and out of the way and you can get on with enjoying your next home, whichever type of property you choose to buy.

 

Retirement Move is the only independent estate agent specialising in retirement property.

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