Savvy Seniors Choose to Move

We hear about the real estate market every day on the news and most of the time it is a doom and gloom story warning people not to sell right now. Unfortunately, there are a few key elements missing in what is reported and those elements are causing some confusion, especially when it comes to senior adults and their plans to move into a Life Care or Continuing Care community such as Longhorn Village in Austin, Texas.

Communities such as Longhorn Village are often appealing to senior adults due to the fact that they can live in one community throughout their life without worrying about their healthcare needs or having to move as a result of declining health over the years. Longhorn Village is a continuing care community (CCRC) with a Life Care Program... the best of both models as far as retirement community options go.

What does continuing care mean? A continuing care community provides a continuum of lifestyle options -- residences, services, amenitites and short or long-term care all on one campus. It is a full service environment centered on active, independent living, yet provides access to built-in support programs, if ever needed.

What is the Life Care program? Life Care is the most extensive and comprehensive type of contract provided in a CCRC. The Life Care contract guarantees lifetime access to and provision of assisted living, Alzheimer's/Dementia care or skilled nursing care, if ever needed. The additional services are provided for as long as needed at a minimum additional cost to what one would pay to live in a CCRC such as Longhorn Village in an independent residence.

Now...back to real estate and how this all fits together. There are seniors who made the decision to move into a CCRC such as Longhorn Village who now are seeing their home equity dwindle and their savings shrink with the downturn of the economy. When they decided to make this move, they did so with the idea that they would use their home equity (and maybe some savings) to cover the cost of their entrance fee. The long term plan made sense and the issue of healthcare down the road was resolved at a MUCH lower cost than if they waited until they were no longer independent (at which point they are no longer eligible to move into a CCRC under a Life Care contract).

The concern that many of today's downsizing seniors seem to be dealing with is the fact that they are being told..."Now is not the time to sell." This may be true for those who do NOT have a compelling reason to sell and can hold out for the next 5-8 years for their equity to rebound.

Keep in mind that most (but not all) seniors have owned their home for several years and are not subject to mortgages that exceed the amount of their value (many of their homes have no mortgage at all). The problem with this theory of "don't sell now" is that healthy independent seniors who want to maintain their independence and still have built-in peace of mind that goes with living in a CCRC with a Life Care contract DO HAVE compelling reasons to sell now. Once one's health begins to fail (or the spouse's) it is too late to make this move. Many seniors will likely lose this window of opportunity to secure their health-care options in a CCRC should they wait on the market to rebound.

The question??? Which is the wiser investment for seniors today... to wait to sell in 5 to 8 years and hope they still qualify for CCRC living and that their home as appreciated to a value that will sell for enough to pay their now higher entrance fee? Or sell now and utilize a combined total of their home equity and other investments to pay their entrance fees to insure their positions in such communities as Longhorn Village, an upscale beautiful and specialized senior living community?

Notice that in the previous paragraph I note that the entrance fees down the road will be higher than they are today. For seniors moving into newly built retirement communities like Longhorn Village in Austin, they are often getting in on an introductory "special" or charter membership entrance fee, which makes the move early on even more compelling. Later the entrance fees will increase as the community fills and the demand is higher.

It is no doubt a tough decision and for some it will cause many a sleepless night. It is my hope that those professionals, real estate and others, who are providing guidance and consult to seniors in this position, fully explore the factors that led to the decision of retirement community living in the first place. Sometimes (most of the time) it's NOT about the money!

For more information about Longhorn Village go to http://www.longhornvillage.com/ or call 512-266-5600. For more information about selling your home and moving to a retirement community, go to http://www.managingmaturemoves.com/ or call Nikki at 512-276-8876.