Navigating Housing Options for Seniors and Their Families

Navigating Housing Options for Seniors and Their Families

Published by the Center for REALTOR® Development

Some seniors may prefer to continue living in their own homes as they age. For many others, there are reasons why moving—to a senior-supportive environment or perhaps to be with an adult son or daughter—may be the right choice:

1. 1  Home maintenance becomes a burden.
2. 2  A major life event creates the need to move.
3. 3  There is a desire to live closer to children or other caregivers.
4. 4  Financial concerns make it difficult to keep a home.
5. 5  Support services are needed that are not available at home.

Whatever the reason, there may come a time when seniors consider selling their home and moving. This booklet is designed to help guide you and your family through the complex issues and unique situations you may encounter.

Selling a senior’s home is different

Housing transition for seniors has unique issues and decisions.

Though many seniors make the decision about their living situation independently, it is not uncommon for adult children, close family or friends, or advisors to help seniors sort through these questions:

Is moving the best alternative? Is so, to where? Have other options been explored?

What is the best way to downsize possessions?

Are close family members on board with decisions?

What are tax-related implications of a sale?

What effect might a sale have on future income and benefits?

The financial, logistical, and emotional issues involved in a move can be stressful. A specialist who deals with the issues seniors encounter during a move can help answer questions and make the process easier and more understandable.

Why you need an SRES®

A Seniors Real Estate Specialist® (SRES®) is a REALTOR® who is uniquely qualified to assist seniors in housing sales and purchases.

The mission of an SRES® is to help seniors and their families navigate the challenges that accompany a home sale. The SRES® designation is awarded only to REALTORS® who have additional education on how to help seniors and their families with later-in-life real estate transactions. SRES® designees are familiar with local community resources and services and have experience drawing on a network of expert senior specialists, such as estate planners, CPAs, and elder law attorneys.

What makes an SRES® unique?

Knowledge, experience, and compassion in dealing with senior issues.

Guidance on housing alternatives, including those that allow seniors to remain in their homes.

Experience with local senior housing options and elder support services.

A service-oriented, no-pressure approach.

Takes the time to make the selling process more comfortable. Tailors the marketing of a home to the needs of an older client. Works to minimize the emotional demands a sale can have. Interacts easily with seniors, adult children, and caregivers.

The idea of moving can be a stressful time for a family—the amount of information and decisions may seem overwhelming. An SRES® understands that and takes the time to get to know you and your family’s situation, helping provide an outcome that best suits your needs.

The added value of an SRES® professional network

For seniors, selling a home—one of life’s most valuable assets—and managing a subsequent move often require unique expertise. By working with an SRES®, you also get the benefit of specialists across a wide array of financial, legal, property, and personal services—from estate planning to downsizing—who can help with considerations in a sale and move, such as:

• Ways to use the home’s equity to allow a senior to remain in their home, if preferred.
• How to protect assets prior to listing. Showing the home in its best light.
• Moving needs—downsizing, senior-specialized moving, estate sale planning, and storage.
• Identifying potential legal issues and referring professional support—from estate planning to closings.

When there is not already a trusted attorney or accountant, an SRES® can refer attorneys, estate planners, financial planners, and tax advisors, each with experience in elder issues.

Many REALTORS® who have earned their SRES® designation also actively participate in senior and community service organizations and can provide referrals to resources such as Meals on Wheels, public benefit offices, transitional services coaches, grief counselors, and other services, as needed.

The SRES® professional network covers a variety of seniors’ needs

What to consider before starting the process

Informing relevant family of a possible sale and its reasons:

Family members can have a strong emotional stake in the sale; some may not want to say goodbye to the home. A family talk about the decision to sell— before signing commitments—can help prevent future misunderstandings and avoid delays in the process.

Having one family member take the lead:

When family members are involved in the sales process, it’s best to have one person take the lead in communicating with the SRES® and other professionals; multiple contacts can create confusion and cause delays.

When a family member is acting on your behalf:

If a family member—often an adult child—would need the authority to make legally binding decisions regarding the home, a durable power of attorney document must be in place naming that individual to act on your behalf.

Tax consequences of a sale:

Selling a home can trigger significant taxation. So, before listing a home, it’s a good idea to consult a tax specialist or professional financial advisor to determine how a sale will affect your finances. An SRES® can provide you with a list of referrals if you don’t have an advisor.

Key considerations in the process

The decision to move—when, to where, and how—has many facets. Here are some of the topics that your SRES® can help you with:

• Housing options
• Meeting health care and other needs
• Legal considerations

• Home adaptations
• Financial considerations
• Selling your current home

Housing options

Some seniors may choose to stay in their current home. Others may consider moving to an adult child’s home. For many others, the choice of senior housing may be the best direction.

An SRES® can help you navigate this process by:

• Familiarizing you with the types of senior housing available in the area.
• Suggesting important questions to ask when visiting

  various housing options.

• Creating connections with experts to clarify and compare actual costs for each option, assess affordability, and review legal agreements involved in the process.
• Suggesting a geriatric care manager to help determine needs.

Retirement or Age-Constricted Communities

• Designed for older adults who are physically able to care for themselves,

  including cooking and personal care.

• Residency is often restricted to adults aged 55 and older; additional restrictions may be involved.
• Usually composed of single-family homes, townhomes, condominiums, or apartments.
• May offer basic services like housecleaning, laundry, and transportation, but seldom offer medical care or more involved support services.
• Often accept pets and often built using universal design guidelines, making them handicapped-accessible.

  Assisted Living Arrangements

• Provide seniors with support services in a community setting.
• Accept residents who may have medical problems but do not need continuous skilled nursing care.
• Encourage residents to maintain their independence, while also offering them access to professional medical care and support services when needed.
• Offer an array of health care and personal services, including assistance with daily living activities such as bathing, grooming, and dressing.

• Usually apartments but can be personal care group homes or single-family

homes providing “board and care.”

• Generally offer a wide assortment of activities, clubs, and transportation to personal appointments, religious services, cultural events, and shopping malls.
• Often accept pets and often provide meals. Continuing Care Retirement Communities
• Represent a “continuum of care” approach, offering a spectrum of senior living options, including independent living, assisted living units, and continuous nursing care facilities, typically in close proximity to one another.
• May also offer a secure and supervised environment for individuals with various degrees of memory impairment.
• Allow residents to enter at any level of care with an assurance that, if their health or faculties decline, they will be moved to the next level of care when needed, through to continuous care.
• May require significant entry fees, parts of which may or may not be refunded if the resident passes away.
• Are usually occupied on a rental basis, though some have ownership arrangements.
• Typically have rather complex contracts due to the levels of service offered and provisions for transitioning between them.

  Nursing Homes

• Provide 24-hour care for people with chronic illnesses.
• Often resemble a hospital setting.
• Have doctors on staff, though nurses administer most patient monitoring and medical care.
• May have physical and occupational therapists on staff.
• Are more expensive because they provide full-time professional care.
• Are seldom covered by Medicare or most health insurance plans (may be covered by Medicaid for those who qualify or by long-term care insurance).
• Are required to meet standards set by the federal government.
• May be run for profit or by not-for-profit groups such as religious or community organizations.

How to choose the right senior housing?

1. 1  Determine level of care needed

   Most housing choices are driven by care requirements: Can
   the senior take care of most of their personal needs but would enjoy having housecleaning, laundry, and meal services? Would medication management, an emergency response system, and on-premises nursing provide the senior and family with more peace of mind? Does the senior need assistance with bathing, grooming, and dressing? Are there concerns about memory issues? A senior’s needs will change over time. An SRES® can refer a geriatric care manager who can help you determine the types of care needed.

2. 2  Examine financial resources

   Housing and long-term care costs can tap much of a senior’s savings, and as needs change, budgeting can be difficult. Elder law attorneys and financial planners can help seniors and their families allocate resources to pay for housing and care. They are also experts in Medicare and Medicaid law and will know which expenses are or aren’t covered by each program.

3. 3  Visit senior housing options

   An SRES® can guide you to listing sites and other resources that categorize local facilities by level of care provided. Check licensing and accreditation for any facilities you are considering. Then visit and tour those that appear to fit your needs, asking questions and talking with families who are visiting loved ones there.

4. 4  Review any contract with an eldercare attorney before signing

   Housing contracts involving long-term care can be complex. When selecting a facility, an eldercare attorney can identify potential issues with a contract and help you resolve those prior to signing.

Health care and support needs:

As years pass, even the most independent individuals may need help with basic daily needs. For seniors who are moving into a residence that provides care, assistance may not be an issue. However, if a senior decides to remain in their home, or move in with a family member, daily caregiving needs can become a concern.

Before making a decision on housing direction, it may be valuable to discuss potential health care needs with all relevant family members, and to develop a plan for meeting those needs.

Identifying needs

A care plan should identify what types of assistance might be needed, how those needs would be met, and by whom. Depending on the living situation, the plan could cover:

• Managing and dispensing medications
• Providing needed in-home medical services
• Transportation to doctors and other appointments
• Health conditions and doctors’ advice, as well as how to make health care decisions
• Managing bills and filing insurance claims
• Laundry, housekeeping, and grocery shopping
• Meal preparation
• Home repair and maintenance
• Pet care
• Emergency response systems, such as a pushbutton bracelet or necklace
• Respite assistance for caregivers

Medicare, Medicaid, and other health care plans

You and your family should examine health benefits to determine whether there is coverage for the types of care needed.

Medicare covers basic medical care and hospitalization, with limits.

Medicare supplemental plans offer a variety of additional coverage depending on the plan, with coverage of prescription costs available.

Medicaid may cover long-term care and nursing home costs if the applicant meets means-tested qualifications.

Private long-term care insurance can also cover portions of in-home care services and nursing home care, depending on the policy.

Determining medical and other in-home care needs, and sorting through plan benefits and available programs, can be overwhelming. If you need assistance determining what services are available and where to find
them, an SRES® may be able to refer a local geriatric care manager—a professional counselor who assesses and helps manage seniors’ needs—
as well as groups and agencies within the community that provide in-home senior services.

Caregiver assistance

Even when adult children are acting as caregivers, an outside caregiver may be valuable; caregiving can be especially stressful, depending on the level of care needed and whether the adult child also works outside the home. Caregiver assistance and respite programs exist to help provide a much- needed break.

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Financial considerations

For many seniors, their home is their most significant asset. The decision to sell it or not should be given careful thought, including consideration of a reverse mortgage—a way to draw upon a home’s equity to help pay living expenses. Whether the choice is to stay in the home or sell it, an SRES® can help describe the alternatives and discuss their financial implications.

Reverse mortgage

A reverse mortgage allows a homeowner who is at least 62 years old to use the home’s equity for cash without the burden of making monthly repayments. A reverse mortgage:

• Is a loan against your home’s equity.
• Requires no repayment as long as you reside permanently in

  your home.

• Is repaid with the sale of the home, if the owner permanently moves out, or at death.
• Can be made as a lump sum, used as a credit line as needed, or can be paid out as monthly supplemental income.
• Can never exceed the value of the home. If at the time of repayment, the home is worth less than the amount borrowed, the lender can never demand more than the market value of the home.
• Will result in less home equity left to heirs; therefore, this may be a subject to discuss with adult children.
• May impact eligibility for other programs. Talk to your reverse mortgage counselor about how it might affect your situation.

An SRES® works with reverse mortgage counselors and lenders to provide financial alternatives to selling a home. These professionals can help a homeowner determine eligibility for programs and assess the amount available based on the value of the home, age of the homeowner, and area of the country in which the owner resides.

Ways to reduce expenses:

Whether you decide to sell your home and move or remain in it, you may qualify for programs that can help lessen expenses. An SRES® may be able to direct you to community, government, and private programs designed to provide additional financial assistance, along with contact phone numbers.

• Supplemental Security Income (SSI) is a program the Social Security Administration administers. Designed for children and adults who have a permanent disability and limited income
  or resources, it is also available to adults over 65 with financial limitations. It provides monthly cash benefits to augment existing income. To learn more about SSI, visit ssa.gov or call (800) 772-1213.
• In some states, those who qualify for SSI may also be eligible for additional state supplements and other public benefits.
• Benefit programs exist to help seniors with medical and prescription costs. AARP is an excellent resource for finding programs. Call AARP at (888) 687-2277 or visit aarp.org.
• Many states offer property tax relief for seniors who remain in their own homes. For more information, contact your local property tax office.
• To find information on other programs that help with expenses such as utility bills, home weatherization, home health care, transportation, and food, you can contact:
  • The U.S. Administration on Aging at (800) 677-1116 or eldercare.acl.gov
  • The National Council on Aging at benefitscheckup.org
  • AARP at aarp.org
  • Canadian seniors can contact CARP at carp.ca or (800) 363-9736
  • The Veterans Administration (VA) offers several programs that may be available to seniors and their spouses at va.gov

Financial ramifications of selling your home:

Many factors affect how much money you will gain from the sale of your home and how the proceeds might impact your future financial situation. Before the home is listed for sale, a tax and estate planner can help you consider how to maximize sale proceeds and anticipate the impact

on future income.

Taxation may affect the sale proceeds

Taxation can reduce proceeds, especially if the home was purchased decades ago, when prices were a fraction of what they are today.

For example, capital gains taxes are levied on the difference between the original purchase price of your home (plus the cost of certain improvements) and the selling price (less selling expenses). For homes owned for at least five years and lived in for at least two years, the seller can exclude up to $250,000 (single person) or up to $500,000 (married couple) of gains from taxation. Typically, losses on the sale of a personal residence are not deductible. Capital gains tax laws are complex; it is advisable to consult a tax specialist to help determine how capital gains tax laws will affect your situation.

Sale proceeds may affect other sources of income and benefits

Many government benefits for the elderly are means-tested; that is, individuals qualify based on their levels of income and assets. In many programs, the home is not counted as part of those assets.

Selling a home could alter this situation and affect qualification. If you have been receiving Medicaid benefits, your state may attempt to recover the cost of those benefits from the proceeds of a property sale. Federal and state programs often have different requirements, so it is best to seek advice before making any decisions.

Sale of a home may affect your estate

Factors such as ownership provisions on the home—whether the house has been placed in a trust, and whether your estate will be settled through probate—may affect your estate. And estate taxes, which apply to estates above specific thresholds, have varied in recent years and will continue changing.

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Legal considerations

The laws surrounding senior issues are complex, and actions such as selling property can affect areas that seem unrelated but are critical to a senior’s situation. It is valuable to retain the services of an attorney specializing in elder law, who can structure legal documents and transactions to protect your assets, benefits, and rights, including:

• Estate and trust planning to minimize taxation on the sale of property.
• Power of attorney and health care directives in the event of a senior’s illness, incapacity, or death during the listing period or prior to the closing.
• Disposition of personal property in a will or trust.
• Examining potential effects of a sale on other sources of

  income and benefits.

• Identifying and assessing qualifications for senior assistance programs.
• Reviewing documents and contracts related to a property sale.
• Assessing and reviewing contracts with residential facilities such as assisted-living centers and nursing homes.

Elder law attorneys also understand issues specific to seniors and have extensive knowledge across many senior-related areas, such as:

• Preservation or transfer of assets to avoid spousal impoverishment when the other spouse enters a nursing home.
• Medicaid planning.
• Medicare claims and appeals.
• Social security and disability claims and appeals.
• Disability planning, including use of durable power of attorney, living trusts, and living wills (health care directives) for financial management and health care decisions, and other means of delegating management and decision-making to another in case of incompetency or incapacity.
• Conservatorships and guardianships.
• Estate planning, including planning for the management of one’s estate during life and its disposition on death through use of trusts, wills, and other planning documents.
• Probate.
• Administration and management of trusts and estates.
• Long-term care placements in nursing homes and life-care communities.
• Nursing home issues including patients’ rights and nursing home quality.
• Elder abuse and fraud recovery cases.
• Retirement, including public and private retirement benefits,

  survivor benefits, and pension benefits.

• Health law.
• Mental health law.

Most elder law attorneys do not specialize in every one of the areas listed.
Be sure to ask which of these matters they handle. An SRES® can provide referrals to elder law attorneys in your area. Or consult the National Academy of Elder Law Attorneys at naela.org.

Selling your home:

Selling the home of a senior can have added considerations and complexity. An SRES® understands these, with the training and expertise to meet the needs of senior home sellers.

After listing papers are signed with your SRES®, there are several steps to make your sale and move most successful:

Pricing

Offers, negotiating, and closing

Staging Packing and moving Showing

Pricing:

Much of the value you and your family place on your home is based on your experiences there, so setting a price can feel challenging, especially if the things you value in your home are not necessarily in line with what a buyer is looking for.

An SRES® has expertise in the unique circumstances of seniors, and will guide you to finding an appropriate market price for your home by:

Analyzing your home

• Documenting the home’s dimensions, layout, and lot size. How many square feet of living space does it offer? How many bedrooms and bathrooms?
• Identifying features that will attract buyers—what makes the home special?
• Looking at the home from curbside—does the yard have features that make it special, like a garden, professional landscaping, nice views,
  or a pond?
• Examining the interior and exterior condition. Is the home in good repair? For areas that need work, how much will it cost to repair them?

  Creating a comparable market analysis

  Your SRES® will show you a list of comparable properties—homes that are on the market and similar to yours in size, number of bedrooms and baths, features, and condition, within proximity to your neighborhood—their current listing prices, and how long they have been for sale. For homes that sold recently, you’ll be able to look at the original listing price and compare it to the final selling price. Through this analysis, you’ll be able to understand how your property and price compare to other homes being offered.

  Understanding your time frame

  An SRES® is an expert on the local market and can suggest a listing price that will yield the best results within your desired time frame.

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Staging

Staging is preparing your home for showing to the public. The goal is to create the most positive impression of your home with prospective buyers. An SRES® can share what’s best when it comes to staging your home.

Staging usually takes place before the For Sale sign goes up and involves getting the outside and inside of the home in shape to maximize the home’s value.

Inside staging might involve:

Deciding how each room can look its best—rooms appear smaller when they contain lots of items. So, storing some of a room’s contents can create an impression of more space.

A thorough attic-to-basement cleaning, perhaps done by a professional service.

Doing necessary or cosmetic repairs, such as fixing a leaking faucet or a back door that sticks. If unattended, these can leave negative impressions in buyers’ minds. It’s best to fix them before the home is shown.

Outdoor staging focuses on the appearance of a home’s exterior and yard, particularly from the curb. It might involve:

Mowing grass, trimming shrubbery and cleaning up the yard, perhaps using a landscaping service.

Having basic external repairs done, such as fixing a sagging gutter or painting trim on shutters that have flaking paint.

The staging process can feel stressful because it may call for moving and storing treasured objects or beginning to pass on some family heirlooms. Yet it’s important to put away valued possessions and items you don’t want handled by prospective buyers—the goal of staging is not only to make the house look as good as it can, but also to protect objects that have special significance.

Showing

There are two types of home showings:

Open houses: The house is open for a few hours to REALTORS® and potential buyers who wish to view it. Your agent is present and will require visitors to sign in.

Individual showings: An agent will bring prospective buyers to your home at a specific time and present your home’s features.

Showing the home while you are present can put you in the awkward position of feeling forced to answer potentially sensitive questions. For that reason, agents may recommend having you away during showings.

An SRES® knows that there are also often special considerations in showing a senior’s home:

Buyer’s agents may call on short notice for showings, or they may want to show the home during times that are convenient for buyers but may be less convenient for a senior homeowner. If showings are preferred during specific hours or by appointment only, these requirements can be defined in the Listing.

If you cannot leave the home during a showing, this can also be noted in the Listing and your SRES® can arrange to be present when other agents show the home.

During an open house, it’s important to place valuables and prescription drugs out of sight. If you typically keep medications out and arranged in an order to be taken more easily, an SRES® can suggest ways to keep them safe while preserving your system for managing them.

Packing and moving:

Moving from your home can be overwhelming, especially if you have a lifetime of possessions and need to make choices about what to move and what to let go. If you and your family are facing the task of packing and moving on your own, think about starting the process well in advance. Set small, achievable daily goals. Establish plans for tackling different rooms. Packing can be emotionally taxing on everyone, so consider ways to break up the work to make it easier.

Sometimes hiring a third party is the best option for packing and moving. Senior moving managers help seniors who must downsize when moving by:

• Evaluating the contents of your current home and assessing space available in the new one.
• Working with you to determine how much will fit in the new home.
• Helping make decisions about what to keep and what to do with items that will not be moved.
• Managing the process of packing and moving, then unpacking and arranging possessions in your new home.

Some senior moving managers also help organize garage sales or estate sales, arrange for donation pickups, and call disposal services for the final leftovers. They appreciate the stress that can accompany packing and can make the job more manageable by packing in a time frame that works with your schedule.

An SRES® may be able to refer you to a senior moving specialist in your area. You can also look online at nasmm.org.

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Moving checklist

 Choose a mover and sign a contract.

 Notify utility companies of your move; arrange final readings.

 Contact movers to review and confirm arrangements.