In case you missed it, a great interview on NPR’s Morning Edition this week. Seniors across the US are struggling with the same question — if I sell my house, where will I go? Click here to read the interview transcript.
The article below comes from the National Association of Realtors/SRES. Hilary Walker has earned the Senior Real Estate Specialist (SRES) designation and is committed to helping Atlanta-area seniors manage their unique real estate needs.
Preparing a home for sale is always a significant undertaking. For seniors, in particular, the pre-listing process can feel overwhelming. An agent who has earned their Seniors Real Estate Specialist® (SRES®) designation can guide your efforts and help make the transition go as smoothly as possible.
You can trust your SRES® designee to help you:
Map out a plan.
An SRES® understands that each client faces different circumstances and challenges. They can advise you on a sequence of steps tailored to your situation. And they’ll guide you through the process at whatever pace suits your needs. Your SRES® will take a no-pressure approach and look for ways to make your move more manageable and less stressful.
Please don’t assume that every aspect of your home has to appear picture-perfect before listing it for sale. Your SRES® understands what matters most to buyers in your market and can help you focus on the most critical projects. The top priorities are often decluttering living spaces and cleaning your home thoroughly, immediately before it is listed.
Is it essential to update your flooring, paint your walls, or replace your appliances? Your SRES® knows local buyers’ top priorities and understands which renovations offer the biggest bang for the buck. They’ll explain your options, but it’s up to you to decide if you want to add these projects to your list.
Suggest trusted resources.
If you need help with any aspect of your move, your SRES® can provide suggestions. They’ve already vetted related service professionals that understand seniors’ concerns and can assist in decluttering, packing, renovating, and more. The choice is always yours, but it’s nice knowing you can turn to these trusted resources.
Discuss staging options.
Many sellers assume they need to stage their home before listing it. Again, this depends on your local real estate market and your personal situation. Often, staging isn’t mandatory. Today’s property marketing options include virtual staging techniques, which might be a good alternative. Your SRES® can discuss your options and offer recommendations tailored to your concerns.
Regardless of when and where you are moving, you’ll have a better experience if you work with an agent who has earned the SRES® designation- someone who is committed to helping seniors navigate their housing transitions successfully
Increasingly, we’re hearing of home sellers being approached by iBuyers – those companies who purchase your home quickly without you having to list and have showings. The largest iBuyers include Zillow, Opendoor, Offerpad, Simple Sale and Redfin Now. It’s a tempting approach for many appearing to be simple and fast, but is it really worth it? I know from experience that working with an iBuyer can mean that you’re leaving money on the table. If you have questions about iBuyers, contact me and I can tell you more.
For some basic information about today’s iBuyers, check out the article below from Nerdwallet.
An iBuyer, or “instant buyer,” is a real estate company that uses algorithms and technology to buy and resell homes quickly. When selling a home to an iBuyer, you may get a cash offer in as little as 24 hours without the hassle of staging and repeatedly showing the home.
You can also buy a home from an iBuyer. The companies’ websites or apps let home buyers view available properties, schedule tours and request information to get started. Closing may occur more quickly with an iBuyer because you don’t have to accommodate a traditional seller’s timeline.
What my clients are saying
My mature and experienced clients know that rates have been much higher than they are today (just 20 years ago they may have purchased a house with a 7% rate). So, today’s rate at just over 5% is still a good rate in their minds, although we’ve been spoiled with those extremely low 3% rates in recent years.
These clients are savvy and experienced to know also that increasing rates can be a detraction for buyers who want to buy now or very soon. So, now the baby boomers and older homeowners in my circle are calling to ask the very serious question…”How quickly do you think my home will sell if we put it on the market now and where do I go if I sell now?“
Here are two scenarios that I’ve seen first-hand.
A first-time home buyer (over 65) approved for a loan in late March prefers purchasing rather than renting because rent has increased by a significant amount for the last 3-years. We have been on the lookout for a home but have not yet found anything suitable.
Reasons for a delayed purchase in this case are:
- wanting a home with all spaces on one level
- low inventory in the area of choice with only one or two potential homes coming on the market each week
- multiple offers on those few homes or they are in disrepair
- and the buyer is searching with a lower-than-average price point (average house values for our local area rose from $278k to $338k)
The first week of May, the lender informed us that the interest rates went up over a quarter percent since the buyer was approved in March so there will be an increase in mortgage payments. This makes the buyer nervous because they are on a fixed income. An interest rate hike above 5.5% may force this buyer out of the homeownership market so time is of the essence.
Most of my clients are already retired, on a fixed income, or have a budget they are adamant to stick to, so overspending for another home is hard to do. I say “overspending” because that is the word of choice among some of my clients who have watched the market take an unprecedented boom of house prices and, while that is fantastic for the seller, it is a hard pill to swallow for the mature buyer.
However, those who need to move are acknowledging this is the market they are in and must move forward regardless. I have a few clients who are in the situation of needing to sell the large home where they raised their families or enjoyed their mid-life empty nest, replacing the space with their hobby or 2nd career or entertaining friends and family periodically. But the time has arrived that the house is simply too large. They are heating and cooling, and cleaning spaces they rarely use so they want to downsize or resize while they can get a good price for their home.
One of my clients wants to move out of their 5,000 square foot home while identifying a comparable smaller home at a mid-range price point – reasonable, at least so we thought.
The search was difficult for these reasons:
- in the madness of the real estate frenzy of 2021/22 even homes in the higher price points were not presented as well as they should have been – a stark difference between photos online and in person
- almost every decent home that came on the market received multiple offers within a day or two
- their competition was no longer just another occupant buyer but now it was large fund investors vying for that property, too
In the case of these kinds of buyers, interest rates don’t bother them too much since, in most cases, they plan to use the equity they have in their current home to purchase the next home or they only plan to keep the mortgage for a few years before they pay it off and live mortgage free. In a couple of cases, they are choosing to use a Reverse Mortgage to help stretch their wealth, therefore, the interest rate is not an issue since they can choose not to make any mortgage payments on a monthly basis.
If you want to know more about how interest rates may affect your decision or that of a loved one to move forward with a sale or purchase, feel free to contact me.
What Is a Reverse Mortgage Loan?
A Home Equity Conversion Mortgage (HECM), commonly known as a reverse mortgage loan, is a federally insured home loan that allows borrowers age 62 and over to access a portion of their home equity to supplement their retirement income. Like their traditional cousins, reverse mortgage loans have financial obligations, requirements and qualifications, but repayment is structured differently. Whereas traditional loans require borrowers to make loan repayments each month for a designated period of time, reverse mortgage loan borrowers aren’t required to make monthly mortgage payments, so long as they pay property taxes, homeowner’s insurance and comply with loan terms. Instead, non-taxable loan proceeds are made available to the homeowner to use at their discretion, such as paying off other expenses, building up a financial buffer for future unanticipated expenses, or planning for the retirement of their dreams.
How Can a Reverse Mortgage Help with Retirement Planning?
According to American Advisors Group (AAG), there are many features of reverse mortgage loans that can benefit seniors who are looking to supplement their retirement income.
- Eliminate monthly mortgage payments. Rather than paying money to the lender each month, you receive funds to enhance your retirement savings. The loan is repaid when you sell your home, move to another primary residence or when the last borrower leaves the home.
- You remain the homeowner and stay in your home. You maintain ownership of and the title to your home as long as you comply with the terms of the loan.
- How you spend the proceeds of the loan is up to you. The loan proceeds have very few restrictions and can be used to pay for common senior expenses like medical care, in-home care, household repairs and remodeling, or paying off other debt. Disbursement options vary: you choose a full or partial lump sum, monthly payments or a line of credit.
- Social Security, Medicare, your 401(k) and pension are not affected. A reverse mortgage loan is considered a loan and not income, so proceeds are not taxable. However, need-based benefits such as Medicaid and Supplemental Security Income (SSI) may be affected.
Want to know more? Click here to read the full article from AgingCare including:
*How to qualify for a Reverse Mortgage Loan
*What are the obligations as a borrower?
*How Does the Government Regulate HECM Loans?
*How to Apply for a Reverse Mortgage
Remodeling a bathroom for someone who is aging in place is very different than one based on aesthetics or home value. If you or a loved one are remodeling with an eye toward future needs, there are some very important issues to consider before you start and as you’re going through the process.
From design, to safety, to ease of use, remodeling a bathroom will take time and effort, and there will be costs involved. But for anyone who wants to age in place it can be very worthwhile to have a bathroom that is comfortable and safe to use easily as needs change.
From something as simple as sensor lights to adding another bathroom, there are options and considerations for anyone who intends to stay in place. But without a clear picture of what you really want to do with your project, you may find that the costs continue to rise and the needed changes either don’t get completed or aren’t what you really expected. Changes have to be effective – and sometimes this means completely revamping an existing space to accommodate what’s needed in the future.
>>Read the full article: What To Do When You Redo Your Bathroom 2022 – AgingInPlace.org
Sponsored by Representative Lee Hawkins, the Georgia Caregivers Act (House Bill 1304) would bring much needed support to family caregivers across the Peach State.
Family caregivers help their parents, spouses and other loved ones so they can live independently in their homes and communities—instead of in costly, taxpayer-funded institutions. They assist with meal preparation, managing finances, transportation, and much more.
Many family caregivers also perform medical or nursing tasks for their loved ones like complex medication management, wound care, and injections. Yet most receive little or no training for these important duties. That’s why AARP Georgia is asking the Georgia state legislature to pass a no-cost, commonsense bill called the Georgia Caregivers Act.
The Act ensures that:
- Patients can identify a caregiver upon admission to the hospital
- The identified caregiver is notified of the plan to discharge the patient home
- The caregiver is given live instruction and training on the medical and nursing tasks to be performed at home.
In 2021, more than half of Georgia’s hospitals were penalized for excessive patient re-admissions. The Georgia Caregivers Act could help.
Did you purchase or sell a home in 2021? If so, Senior Real Estate Specialist Hilary Walker gives you two quick tips in advance of the 2021 tax filing deadline.
Baby-boomers and seniors want to retire and move to a tax-friendly state. So, how tax-friendly is Georgia? An Atlanta Journal Constitution article looked at that and found that it ranks pretty well for the following reasons:
- There is no tax on Social Security retirement benefits.
- Anyone 65 and older is offered a maximum deduction of $65,000 per person on all types of retirement income.
- Sales taxes and property taxes are relatively moderate. The 4% sales tax puts Georgia in the bottom 20 of the country. Georgians pay below-average for property taxes. It’s around $870 per year in property taxes per $100,000 in home value.
- There are no inheritance or estate taxes.
>Click here to read a related article: Lack of inheritance and estate taxes makes Georgia a popular place to retire.