Sunday, January 14, 2018

Tops Tips for The Over-50s Buying Their Retirement Property



Over the course of your life you will have bought, sold and rented properties, which means you’ll know your way around the process. Where this differs, however, is that when it comes to your retirement home or your final home you’ll buy, you need to get it right.

As much as the current family home offers in cherished memories, the sentiment doesn’t pay the bills and sometimes a large family property simply becomes hard to for the occupants to keep up with as they get older. 


As you may have guessed, there is a whole host of reasons why the over 50s homeowners may want to move house so there is never a typical last time buyer. Some want to move to be closer to family, some want to downsize, some want to upgrade to their dream home, others may want to move to a quieter location. 

Many downsize to release equity to help fund retirement, while others are motivated by the lower running costs of a smaller home. For older homeowners with mobility issues, bungalows become attractive as do small retirement flats in buildings with lifts.

Of course, it is situation dependent but for whatever reason you may want to re-locate, make sure you consider all of your options first. 


Below we’ve outlined some of the top things to take into consideration, but remember to take independent and professional advice if you want to be clear how your home could affect your inheritance, cost of care and eligibility for State benefits.

1. Don’t Get Above Your Means


A simple enough sounding point but one that often gets overlooked. Many over 50s overstretch themselves on their final purchase cause they may want that final, really special retreat and just go for it. 


Whilst you shouldn’t ever back down from your dream home, at this time you need to be practical and cost effective. Ill health sadly becomes more common after 60 so whilst you may plan to work well into your 70s, your body might have other ideas. 



A well-paid job you may have now, may be lost and if you struggle to find another, it could leave you vulnerable financially if you’ve just bought a big home. 

Mortgage lenders will also restrict your ability to borrow into your old age, with most limiting mortgage terms to finish by your 75th birthday, and of course you must prove that your income stacks up. 

But it's up to you to be cautious too, because if you get it wrong you may have to sell your dream home, and there are no guarantees that you will get the price you want for it.

2. Consider Downsizing


If you’re in your 50s or 60s you may not feel like you’re ready for this, as most empty nesters don’t. However, you need to be practical and think of the bigger picture. Say you have a large house that was filled with your children before they all moved out. 


Now gone, you must upkeep this large home, when in reality most of the space is unneeded. You could downsize, cash in and find a smaller place that meets your needs. By doing this is gives you a greater nest egg to treat yourself or your children. 

A step often dismissed, this in fact is one of the best moves you can make as an over 50’s adult. If you want to use your retire time to travel, this gives you the freedom to do so. 

We all know how poor pensions are these days so why not consider it as it could give you that money you need now! Furthermore, retirement is a great time to invest in property as a whole, you could put some of the gained money into rentable properties that give you consistent income whilst you enjoy your retirement. 

The bonus is that there are loads of properties to invest in, whether they are commercial or residential. If you don’t know where to start, it may be best to seek professional help from local estate agents or commercial property agents.

3. It’s All About Location


You may picture yourself spending your later years in an idyllic rural retreat, and that's ideal for some. No doubt you currently drive a car and can easily get to where you need to be. 


There is no reason you can't drive a car until the day you die, but in practice, many people do stop driving in their later years or cut down the number of longer journeys they need to make. 

Because of this, it's important to consider access to public transport when you think about the location of your last-time buy.

4. Get Advice


If you’re considering your last property purchase, then don’t forget to think about your inheritance. Maybe you’re considering the release of equity to gift your loved ones now or maybe you want to buy a bigger family home to pass on in the future. 


Whatever it is, you need to consider your position financially, legally and from a tax viewpoint. Not only are there issues surrounding Inheritance Tax, but increasingly people are beginning to think about the possible cost of long-term care and your property's value comes into play here, along with your other assets. 

It is key that you know the rules and regulations of gifting money or property to your children. Seek professional advice from tax professionals as they’ll be able to explain your best options available.



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