Retirement is often associated with big changes — from your daily routine to your finances, to where you decide to live out your golden years. When it comes to relocating or buying a new home, seniors have some unique considerations to keep in mind—the size of the home, its floor plan, its location, and how you’ll pay for it.
However, there is another, often overlooked, factor to weigh into your decision when home shopping—will the home be conducive for your changing needs as you age? With nearly 9 in 10 Americans (88%) between 50 and 80 years of age expressing how important it is to remain in their homes as they grow older1, having a home that will allow you to “Age in Place” may be a top priority.
Before you call your realtor or head to the next open house, consider creating a list of factors that matter most to you in a home – both now and in the future. Here are some factors to keep in mind as you think about your next move.
1. Explore Different Types of Homes and Communities
As a senior buying a house, it’s beneficial to consider a wide range of living options and think about which option will be most practical and enjoyable for you in the long term. Condos and apartments often require the least amount of upkeep, and many have elevators that reduce or eliminate the need to climb stairs or steps. Private developments may come with additional costs such as HOA fees, but they make property upkeep easy by providing important maintenance services like landscaping, lawn mowing, snow removal, and more. You can also purchase a home in a retirement community, which typically include convenient amenities like swimming pools, golf courses, and social programs.
2. Location, Location, Location…
It’s still one of the most important factors to consider as a senior home buyer. People choose a home location for a variety of reasons, and you’ll want to think about which are most important to you. Do you have children and grandchildren or other loved ones you want to be geographically close to? Maybe you’re thinking about relocating to a warmer part of the country or looking for a lower cost of living in retirement.
Whatever your reasons, it’s also important to consider the proximity of your house to essential services. Will your new home be close to healthcare facilities? What about grocery stores? Are there enough transportation options available? The location of your home will determine your lifestyle in the future, so be sure to choose it carefully.
3. Think About Aging in Place
Despite the growing number of seniors wishing to remain in their homes into advanced retirement years, many have not taken action to make necessary modifications. In fact, according to a Healthy Aging Poll, nearly half (47%) admitted they’d given little or no thought to the steps they’d need to take so they could remain safely and comfortably at home as they age1.
When looking for a new home, there are some “aging in place” factors to keep in mind. Will your new home age well with you and your changing needs as you grow older? First-floor bedrooms, spacious floor plans and wide hallways, level sidewalks, and the potential to add accommodations like grab bars in the shower, are all important examples to consider. The ability to live in your new home for as long as possible requires important forethought and planning when you buy. And perhaps the best way to get started is by taking an “inventory” of what changes could be made around the home. Learn more in our Aging in Place Checklist.
4. Compare Your Buying Options
As a senior, you have unique financial considerations to keep in mind— adjusting to a fixed income, spreading out your savings to last your whole retirement, and what you’ll do if you are unable to continue living independently at home. It’s important to know what mortgage options are available, so you can keep your assets and maintain a steady cash flow in your retirement years.
A HECM reverse mortgage loan can offer greater financial security to seniors and retirees But, did you know it can also be used to help you purchase a new home? With a HECM for Purchase, you can buy a new home that better fits your lifestyle, while potentially conserving cash and assets for future expenses. Unlike a traditional mortgage, this type of loan helps you accomplish two goals with a single transaction – buying a new home while securing a reverse mortgage. Many seniors like this option because it can help save money by reducing closing costs since a single loan is taken out.
Using proceeds from the sale of your current home, or cash on hand, you make a down payment and cover closing costs. The balance of the purchase is covered by your HECM proceeds—any remaining funds can be used as you choose. The best part? You make no monthly mortgage payments on the new home2. Plus, you maintain title and ownership of the home—not the bank—and you can continue to live in it, as long as the terms of the loan are met.
Making Moves for Brighter Future
When it comes to buying a new home, your home equity can be a powerful source of cash flow. Whether you decide to age in place or purchase a new house that better suits you in retirement, it’s important to explore these factors now to avoid complications later on for you and your loved ones. Be sure to talk to a trusted financial advisor or your mortgage broker about mortgage options for seniors and which one may best suit your individual situation.
Now that you know what features to look for when buying a home, it’s time to start the search. At Longbridge Financial, we know there is no place like home. That’s why we’re committed to responsibly helping homeowners reshape their financial future by educating them on Home Equity Conversion Mortgages (HECM)—and helping them unlock the power of their homes.
We’ll get to know you, and take the time to understand your situation, so we can offer solutions that are best tailored to your needs. And if we ever feel that a reverse mortgage is not your best option, we will tell you so. Not all lenders make that pledge.
See why over 1.2 million Americans have made a reverse mortgage part of their retirement plan3. For more information, contact the Longbridge team today.