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Where do retirement living apartments fit into our life plan?

By Kathy Lawrence

Retirement apartments are springing up all over the place. In some countries these developments and larger retirement villages are commonplace and even part of people’s normal retirement plan. That’s not yet true in the UK, but do they represent a sensible move for people moving into retirement?

At the age of 78 and a year after she lost her husband, D sold her house and moved into the McCarthy & Stone Springhill retirement development in North London. Her single-bed apartment is a reasonable size and she has made it very much her own. She misses cooking on gas, sitting in the privacy of her own garden, and having a bath – there’s a walk-in shower instead – but voices few other regrets.

As with many of the residents, D has only moved a few miles to the development, having lived locally for around 40 years. That means she knows the area, which is important to her. But being in this new community has led to new friends and new activities and she now attends a local church with another resident and has joined a band of volunteers helping the elderly.

This sort of independent living is working for D, but it may not be right for everyone. How can we decide whether this is the right option for our family – or even for us?

What are you hoping to achieve?

Moving into retirement living is often seen as a downsizing option that releases funds to support retirement. That may not be the case. Older houses that haven’t been maintained for a while may achieve disappointing sale prices, while apartment prices can vary greatly, depending on provider and location. According to McCarthy & Stone very few residents actually go as far as to take out a mortgage to fund their apartment, though they may rearrange their financial affairs to give them the regular income to pay the service charge.

On the other hand, if moving is about keeping your own space while having other people around with potentially similar interests, then this could be the right path. At Springhill there’s no bingo night but the residents do organise theatre outings and film nights amongst themselves. With loneliness recognised as a major issue amongst older people, retirement living could be a solution.

And if the idea of living in a property where someone else looks after the fabric of the building (paid for through the service charge) is appealing, then again this could make sense. Retirement living is a global choice, with many people looking at the best places in US to downsize in retirement as well as Europe, Australia, New Zealand and other countries.

Factoring in the costs

As with most blocks of flats in the UK, retirement living apartments attract service charges. These should be set out clearly by the provider and there should be some commitment to not varying the charge massively from one year to the next. McCarthy & Stone manage that by keeping a healthy contingency fund.

At Springhill House the service charge includes ground rent, the concierge’s salary, emergency call monitoring, buildings insurance, maintenance and running costs of communal and external areas, and an estate management fee.

Residents at Springhill are responsible for the maintenance and running costs within their apartments.

Probably the biggest and most important difference compared with “normal” apartments is that residents pay a further contribution to the Contingency Fund when they sell the apartment. Here it’s 1% of the gross sale price or open market value. Other providers will have their own percentage and it’s important to check all the purchase, running and sale costs before making a decision about moving.

Independent living is exactly that

Retirement living developments such as Springhill most benefit the fit and healthy who are looking for a more manageable home and potentially some company.

They do not offer the facilities of care homes. Here there is a concierge who can provide information and contacts – but who is not a carer in any way. There are also red pull cords in every apartment for emergencies. Otherwise it is much like living in your own home. The neighbours might be closer and more supportive in a development, but it’s still down to the individual to understand their needs and organise their own help appropriately.

Not all developments are the same, and some do give more official help. In McCarthy & Stone terms, there are developments that offer “assisted living”. This gives residents access to inhouse restaurants and more domestic help. If it’s personal care that’s needed, then that is again a private issue. Other providers may offer more – or less.

And just as when people stay in their own houses, there may come a time when the resident and their family have to consider whether a care home or nursing home might not be more appropriate.

Other factors to consider include:

  • How long is the lease?
  • What’s the council tax and who pays?
  • Are there limitations on visitors?
  • What about pets?
  • Is there actually enough space in communal areas for residents to enjoy the facilities? And that includes the outdoor space, parking, laundry and mobility scooter storage.
  • How much responsibility does the provider take for helping you through the purchase (and sales process) and finding you services for everyday living?
  • Is the site itself easy accessible? Close to shops, transport and other local amenities? Quiet enough?

What’s the choice?

There are a growing number of retirement living providers, offering apartments and village complexes with varying facilities – and offered at a wide range of prices. For the most part these are homes to buy, although some providers do offer rental schemes.

It’s a rapidly growing market, with providers scouring the country for what they feel is appropriate land.

You can find out more about the range of retirement schemes and their locations from their trade association ARCO.

This article was published in April 2016.

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