Not sure where to spend your golden years? Experts give advice
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The first hurdle families often need to overcome when making decisions about the future of elderly loved ones is whether they should live alone, with family, or in a retirement village.
The second hurdle, should they decide to move to a senior retirement development, is which village to choose.
Many retirees feel offended when the suggestion of moving to a care facility is discussed and, similarly, many families feel guilty for suggesting it.
The good news is that modern retirement villages, with their usually attractive surroundings, opportunity for friendships, and numerous activities on offer, are not the “old age homes” of yesteryear.
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They are actually thriving lifestyle villages that are, unfortunately, still out of the reach of most South Africans, either through affordability or demand exceeding supply.
For those that do have the option, the experts offer some sound advice.
Choosing the area
Gus van der Spek of Aview Properties says retirees should choose a place that has onsite facilities which create a sense of community, but in an area that offers a break from the estate close by, such as gardens for walks or coffee shops to see friends.
He adds: “When considering location, think where you’ll be in 10 years from now. Being near family and the things you know will be important. Proximity will begin to play a big role in your life when longer driving distances become more difficult. No one likes to think about these things, but we are all human and being around the things you know and the people you love will become vital in extending your quality of life.”
Being near high quality health care and hospitals will also become more necessary as time goes on, he says.
Phil Barker of Renishaw Property Developments, says while proximity to family is undoubtedly important, retirees need to take into account the possibility of family moving away, and perhaps consider focusing on selecting a village that fits their own needs.
“This means looking at security, health care and community in a beautiful nature-based location that provides ample and varied opportunities to start one’s new adventure and live the holiday.”
When it comes to choosing an area, Barry Kaganson of Auria Senior Living says this is based on individual choice, but most people choose to live in areas close to where they lived before so they can be closer to friends/family and familiar surroundings.
Picking the right estate
When moving into a senior living community, Kaganson says it is important to plan well ahead to secure a space in a senior living community. Planning should include:
• Assessing the senior living options available such as sectional title ownership or life right, and considering the most appropriate ownership model for your needs.
• Selecting a desired location and putting one’s name on a waiting list in good time.
• Looking at the quality of the operators, their track record and their long-term commitment.
• Checking what level of care is provided.
• Speaking to current residents to find out how they enjoy living there.
Echoing this, Barker says retirees should consider three items that Renishaw Hills deems “non-negotiables”. These are:
• Top-notch security.
• Affordable health care.
• A thriving and active community
The right estate is one which works for you, adds Van der Spek.
“When my parents were look to move into an estate I visited many. It struck me that the things which I found important, were not necessarily important to them. Ultimately my advice to anyone looking to move at this point in their life – and it’s the same advice I give my clients – is: ‘Don’t make the decision for today – think 10 years on’. This is when you will need friends and family most – when the family doctors, dentists and familiar surroundings will benefit you most.”
What is a Life Right?
Kaganson says a Life Right scheme differs from a sectional title or full title property in that ownership of the property is held by the Life Right’s scheme owner/operator. Even though legal ownership of the property is not transferred to the occupant, a Life Right is sold under a secure legal framework, which essentially provides the occupant with all the legal protections of full ownership of the property during their lifetime.
“When purchasing a Life Right, a market-related capital sum is paid to the Life Right scheme owner for the right to use the property for the remainder of the occupants’ lives. When the Life Right terminates, which is either on the death of the Life Rights holder, or if they move out of the community, the original capital sum or a portion of it, depending on the terms of the contract, is returned to the occupant or their estate. There is no transfer duty or VAT payable upfront.”
Unlike full title or sectional title schemes, any capital appreciation in the property accrues to the scheme owner, and not the occupant. Life Rights are regulated by the Housing Schemes for Retired Persons Act (Act 65 of 1988) while sectional title complexes are run by body corporates.
Which to choose
Life Rights gives a couple or nominated occupants a housing interest, in the same way as sectional or full title gives both people right of abode, says Van der Spek. But one must consider where the on-going income stream is for the developer who stays involved in the management of the estate.
“Purchasing into a sectional-title estate means that your living costs and ongoing repairs and maintenance of the estate will be higher as the developer looks to this management function as an ongoing income stream.”
With Life Rights however, the developer makes sure that the estate is maintained and that your experience while living there is of the best standard, as they have a vested interest in the on-going values of the units.
“So while the capital growth of the unit goes to the developer, the cost of services and living are low in a Life Right estate and maintenance is for the developer’s account.”
Put simply, Barker says the advantage of the traditional route, whether freehold or sectional title, is that capital gains accrue to the owner.
“Life Rights contracts vary but generally, there is a discounted entry price and no capital gain.”
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