Buying a Retirement Home

Dorset, Devon and Cornwall are the retirement hotspots. Almost as popular is the far north with Fife and Aberdeenshire being very popular.. At present just under 5 % of the UK population live in retirement housing. In the US the figure is 17% and in Australia and New Zealand 13%. As life expectancies continue to rise then providing better retirement home stock will be key to alleviating the pressure on care givers. Locally more applications for the development of family homes into retirement homes are being submitted to the local council.
Retirement housing is intended for older people. Residents usually need to be at least 55 or 60 years of age. I am depressed that I fall into this age bracket and am classed as “older”. I have little chance of retirement in the foreseeable future.
The majority of retirement housing is sold on a leasehold basis. A lease is essentially a tenancy granted for a long period of time-99 years or 125 years. A leaseholder pays a large amount upfront (a premium) and then a small amount of ground rent to the freeholder each year. It is the lease that is sold when the property changes hands so the length of the lease will keep reducing. The rights of a leaseholder can be very different from those of a freeholder. As a leaseholder you will have a landlord who will retain some control over your property and how you use it. This may make life more manageable for you but it may be a big adjustment if you are used to making all your own decisions about your property.
Most private developers will hand over the management of the retirement housing to a management organisation. The management organisation will be responsible for many things including the provision of a house manager, the cleaning and upkeep of communal areas, the repair and maintenance of the structure and the insurance of the buildings. You will pay a service charge to cover these items.
If you are thinking about buying a retirement property then you should find out who the managers are and how experienced they are in looking after leasehold properties. You can see whether they are members of a recognised trade body that will promote and maintain high standards of management in retirement housing. You may also want to consider whether there is a residents association that works with the management organisation to ensure that residents views and needs are met.
There are codes of practice that exist to protect residents rights in retirement housing. A purchasers information pack is provided to the purchaser of a retirement property and this includes information about the freeholder and the management organisation, the services that will be provided, the charges and service charges and information that will apply on a resale of the retirement property.
If you are thinking of purchasing a retirement property then do contact us for advices on enquiry@dixonstewart.com

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